Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, January 22, 1995 TAG: 9501280004
SECTION: ECONOMY PAGE: NRV-22 EDITION: METRO
SOURCE: RICK LINDQUIST STAFF WRITER
DATELINE: CHRISTIANSBURG LENGTH: Long
While the average sale price of a single-family house in Blacksburg, including town houses and condominiums, rose by more than 11 percent - to $111,193 - and in Christiansburg by almost 4 percent - to $82,169 - over the past year, average prices dropped by more than 2 percent - to $108,597 - in surrounding Montgomery County.
Still, the county had the distinction of having the valley's most expensive home sale for 1994 - $384,637 - according to Multiple Listing Service statistics.
Prices on comparable properties also were up approximately 3 percent in Pulaski County and Radford, but dipped in Floyd and Giles counties and at Claytor Lake, for which separate statistics are kept.
For the entire valley, houses were selling faster in 1994. They were on the market just over four months last year, two weeks fewer than during 1993.
As 1994 drew to a close, several brokers reported good to excellent annual figures, though the statistics suggest a tightening market. Overall, while residential closings in the New River Valley were off by approximately 2.6 percent, average prices were off by just a fraction of a percent from the previous year.
Blacksburg real estate agent Jean Simmons - who is also president of the New River Valley Board of Realtors - was at a loss to explain why average prices for Blacksburg residential properties were well above those for the rest of the valley.
"Usually it's a buyer's market," she said of the region. However, she also noted a "definite shortage of listings" during 1994, which could help explain the upward price trend in an already desirable community. She also speculated that more buyers might have "moved up" to more expensive houses while interest rates were low.
Pulaski County broker Betsy Mabry said her small agency experienced "a very strong year," and her overall impression was that most brokers in her county were running "pretty much in line with the year before." But, Mabry also thinks a more conservative streak among consumers has affected both the market and the real estate business.
"What we've noticed more than anything is that inventory is getting tighter, but demand is staying good, which makes our job even harder," she said. So hard, in fact, that the ranks of real estate brokers has dwindled over the past year and the challenges of the profession have grown, she said.
The upside for sellers and brokers alike is that sellers are "more apt to get their price," while houses spend less time on the market, she said.
Among trends in Pulaski County, Mabry said, was greater demand for house building sites in the Fairlawn area and for houses in Pulaski's historic district, where some sales were in the $200,000 range. Demand remained strong for houses in the Dublin area, especially in the $50,000 to $60,000 range, she said. In her agency alone, building lot sales "more than doubled" last year.
The number of home sales around Claytor Lake increased slightly, from 17 to 21 houses, but the average price dropped by nearly 11 percent - to $89,800 - from year-earlier prices. Houses that did sell spent almost a month longer on the market than a year earlier. Even so, the price tag of the most expensive single-family lake property sold went up by $25,000 from 1993 to 1994 to $200,000, suggesting that a few more houses in the lower price ranges easily could have skewed the average.
Higher interest rates could hobble the still-healthy New River Valley real estate market, especially home sales to first-time buyers and sale of rental properties, some brokers say.
"Overall, it has been a very good year," offered Carl McNeil, a Christiansburg Realtor. McNeil said new buyers arriving in the valley were looking at homes in the $90,000 to $150,000 range. McNeil also said people building their own homes in many cases were spending more than in the past.
But the higher interest rates worry him. "If it continues to get higher, it will continue to slow things down," McNeil said.
McNeil, who does most of his business in Montgomery County, said sales in the newer, more exclusive subdivisions in Blacksburg and the Ellett Valley and on three- and four-acre tracts in Riner have been good.
Mabry said rising interest rates have not yet begun to seriously erode business in her part of the valley, but warned prospective buyers not to wait around for the situation to improve anytime soon.
Bill Bondurant of Bondurant Realty in Radford said when interest rates go down, people jump into the market to get a good loan deal. When they start going up, buyers try to beat the rise, which is how things went in late 1994, he explained.
"Some buyers moved faster this fall because they thought that rates were going up," he said. The biggest impact has been on investment property sales, which he said were more brisk last year when interest rates were lower.
Higher interest rates also may keep some first-time homebuyers out of the market, Bondurant believes. He saw more first-timers when rates were down because buying and renting were closer in terms of monthly cost.
As rates go up, the choice then comes down to buying less house when prices are up or continuing to rent - and waiting for the market to shift gears again, Bondurant said. Appreciation also will slow as interest rates go up, he predicted.
Despite the higher interest rates, Bondurant said it's his impression that "everybody's been having a good year" in the New River Valley.
Statistics from the New River Valley Association of Realtors through mid-December show approximately 60 percent of homes selling for between $40,000 and $100,000, with a big chunk in the $60,000 to $80,000 range. Almost two-thirds of the buyers used conventional financing, although more than 13 percent paid cash.
Almost two-thirds of houses put on the market sold within 90 days, and almost half of those sold within the first month.
by CNB