95 days:Home sale wait grows

By Richard Mize

Published: February 23, 2008

Home sales started the year even slower in the Oklahoma City area, with the average listing taking just more than three months to sell — but the wait might seem worth it for sellers with property values up 5.2 percent last year.

Houses that sold in January took an average of 95 days from listing to closing, according to the Oklahoma City Metro Association of Realtors. That was three days longer than in December, when marketing came to a virtual standstill after an ice storm knocked electricity out for days across the metro area.

Sales remained dead-of-winter sluggish here despite a historically low average interest rate of 5.63 percent.

The median price of homes sold in January dropped 7.8 percent to $123,500 from a median of $133,950 in December. The median, considered the best gauge of the market because one-half of sales were for more and one-half were for less, has fluctuated month to month since July.

However, the median price for 2007 as a whole was $129,074, an increase of 5.2 percent compared with $122,725 in 2006.

"We're doing pretty well. It doesn't surprise me that it's up,” said Marolyn Pryor, president of the Metro Association of Realtors. "I think the word's getting out. We haven't had near the low offers we were getting.”

The Oklahoma Association of Realtors is doing its part to change people's perception of the state of housing here.

Even as the national average price dropped 1.4 percent last year and certain major markets are seeing double-digit declines, in Oklahoma the average sales price for an existing home rose last year 4.24 percent compared with 2006, from $143,669 to $149,758.

The state Realtors group is spending $200,000 to get those numbers before the public in a marketing campaign called "Good Thing You're in Oklahoma.”

Pryor said the slowdown isn't surprising considering the increase in the number of houses on the market since the end of the 2002-2005 construction boom.

"We do have a lot more listings than we had two or three years ago, with the same number of buyers. (Houses) will sit there longer,” said Pryor, whose Marolyn Pryor Realtors has offices in Mustang, Yukon, Tuttle, Moore and Oklahoma City.

January ended with 8,881 houses for sale in the Oklahoma City area. That's a 5.6-month supply, based on average sales and listings over the past 12 months. The inventory has been basically stable — at 5.5 months or 5.6 months — since October.

The housing supply peaked last year at six months, in September. The metro area started 2007 with a 4.8-month supply of houses on the market.

The nation as a whole has an inventory of about 11 months. Oklahoma City's supply of 5.5 months is nothing to worry about, said Joe Pryor, a Realtor with RE/MAX Associates in Edmond.

"That is great. Six months is a neutral market. We're a very balanced market,” said Pryor, who is treasurer of the Edmond Board of Realtors.

Prices here are sound, too, he said.

Homes prices have been depreciating, and foreclosures have been on the rise, in markets where they were artificially inflated in the first place, from an overabundance of mortgage loans with questionable payback structures that assumed continued appreciation, Joe Pryor said.

When increased monthly payments came due and homeowners couldn't afford to make them, they defaulted, sending waves of vacant houses onto the market and sending prices down, he said.

In Oklahoma City, Pryor said, "We're at an actual-value level.”

While housing markets are local, the mortgage market is national, and "lending has changed dramatically,” he said. "Things are tightening up, and that's fine” since builder loans are under increased scrutiny, as well, and "not as much new construction is coming on the market.”

Is home construction still on the wane here?

Builders in Oklahoma City, Edmond, Midwest City, Moore and Norman obtained permits to build 395 homes last month, according to the Central Oklahoma Home Builders Association.

That's one more than the monthly average for 2007, when the high point was 501 permits, in March, and the low was 245 permits, in December.

"Builders are certainly exercising discretion in regard to inventory, and keeping tabs on the pulse of the market,” said Jeff Click, vice president of the Central Oklahoma Home Builders Association. "The symptoms we're dealing with here aren't blood pressure or heart rate, though, to carry on with the metaphor. It's really a psychological condition within the market marked by delusions that Oklahoma City is suffering from the same ailments found elsewhere in the country, a real estate hypochondria of sorts.”

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