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April 23, 2024

Local Real Estate Update

Business is positive despite low inventory in county

By Catherine Kirk

The Bolivar Bullet

Despite inventory shortages, local real estate agents are saying business is still good.  

Debbie Davis of Debbie Davis Real Estate said she has had a good sales year thus far. 

“Our (Multiple Listing Service) MLS statistics show that sales for the first half of 2023 have increased over 2022,” she said. 

Although the market’s current average of 7% interest rates have made purchasing a home more difficult for some buyers, Davis it is still a good investment to make.

“I am sure the increase in interest rates has made home buying more difficult for many buyers, but home ownership is still a good investment,” she said, noting her biggest challenge has been inventory numbers. 

“The biggest obstacle that I run into is the low inventory of homes for sale,” she said. “We need new developments in the mid-price range.”

Libbi Logan, of Partnership Properties, said inventory is low, but it’s not as bad as she’s seen it in the past.  

“We’re still in the inventory shortage, it’s just not as severe as what we had in the past,” she said. “We’re kind of closer to that equilibrium in our market that we need of buyers and sellers. It just really depends on the price range. Some price ranges we’ve gotten a nice supply of listings, and other times we got nothing.”

Logan said interest rates are still in a good place, especially when people compare what they would spend on rent compared to a mortgage payment. 

“Historically, the interest rates are still at a very good place, and when you compare what you pay in rent to what you pay in a mortgage payment, even at current interest rates, you’re still coming out ahead,” said Logan. “Of course, once you factor in the tax deduction of your interest and all of those things, the equity that you build and the benefits of home ownership, it’s still a great time to buy. Even if you wanted to buy at 4 percent two years ago, it’s still really advantageous to buy now.”

“We’ve been bouncing around 7% for a few months. There’s some projections that they’re going to be down closer to 6% by the end of the year,” she said. “I don’t know what the quote experts base this on, but I do know all of the inflation markers used to decide about the interest rate hikes have softened, so it looks like what they were looking to accomplish by raising interest rates has occurred. I don’t expect them to raise interest rates anymore. I feel like we’re going to be in a good spot heading into next year for sure.”

Logan said she saw similar interest rates to what they’re currently dealing with when she joined the real estate business 25 years ago. 

“When I started 25 years ago, they were a smidgen higher than they are now, and that was a 25-year low at that point. We have been in an incredibly low interest rate season for a really long time,” said Logan. “People don’t realize that for 20-plus years before that, people were financing things at 10%, 12% and up to 20% at times, and those people still were able to purchase and build equity and use that home purchase to build long-term wealth. That’s really the goal of buying a house is it is the number one way for a person to build heath over their lifetime. I would definitely not let a 7% interest rate stop me from starting that process.”

Anthony Steen, real estate agent with Tom Smith Land and Homes, said he made about 40 sales in total in 2022. So far this year, he is currently at about 35 sales, and hopes to double that by the end of December. 

“The market’s pretty good. You just have to get out there and advertise and find it,” he said, noting that a higher mortgage rate doesn’t slow down business much.

“If somebody’s ready to buy, they’re going to buy. It’s that simple,” he said. “A higher mortgage rate might slow them down a little bit, but not by much.” 

The biggest obstacle they’re currently facing, Steen said, is politics. Under new rules from the Federal Housing Finance Agency (FHFA) that was set to take effect May 1, borrowers with lower credit ratings and less money for a down payment will qualify for better mortgage rates than they otherwise would have, while those with higher ratings will pay increased fees.

“In my opinion, that’s going to put everybody and these banks in a bad spot where it’s going to put us back to where we were in 2008,” said Steen. “A lot of foreclosures are going to happen, I believe, and that’s going to hurt the market. What it will do is help the people with a lot of money who are going to be buying a bunch of foreclosed houses to flip in the long run.”

Henry Mosco of SmallTown Hunting Properties & Real Estate said the majority of what their company sells is land, and that side of the real estate business is also doing well.

“The land business has been very good,” said Mosco. 

Mosco noted there isn’t much inventory in Bolivar County to sell, so they focus a lot of their attention to other areas throughout the state. 

“The biggest concern we have is getting something to sale,” he said, noting most of what they do end up selling in Bolivar County is farm land. “People don’t want to sell the land.”

Overall, he said, they have been doing well with what they are selling. 

“It’s just been a good year for the land business,” he said.