Real Estate Market picks up as Spring begins

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By Wayne Faulkner,
Business Editor

This year's spring house-hunting season belongs to the buyers.

That's what area real estate agents are saying - and here are the reasons.

1. There's plenty of inventory - more than 5,700 homes in the area served by the local multiple listing service - and listing prices are lower or about the same as last spring, depending on whom you ask. This may add to your negotiating power, agents say.

But homes are still fetching an average of 96 percent to 97 percent of the list price, said Gene Bush, broker in charge at Weichert Realtors Coastal Choice Downtown, who supplied the listings snapshot of 5,728 homes.

2. There's still 100 percent financing out there if your credit score is high enough, agents and lenders say. And Freddie Mac reported this week that interest rates on 30-year, fixed-rate mortgages fell below 6 percent for the first time since mid-February.

Lenders, however, are more focused on creditworthiness than a year ago, and a lower credit score may mean you'll pay a higher interest rate than other buyers.

3. Finally, there are bargains out there, depending on the seller's motivation, the location and the price range, agents advise.

"If you couldn't afford the house in the location you liked last year, take another look at it," said Glenda Tate, an agent with Century 21 Sweyer. "Maybe you can afford it."

Tate says she is excited about the market from the buyers' point of view.

"If you were looking for a house that cost $325,000 last year, you're going to get more house for that money," Tate added.

"If I'm out there as a buyer, 'maybe this year I can get it for $280,000 or $290,000.'

"The bargains are more focused on price range than neighborhoods," she said. "There's a lot of selling going on right now" in the $150,000 to $250,000 range.

Tate is working with the Parham family, transferred by GE-Hitachi from San Jose, Calif.

James and Angela Parham say that asking prices have come down from their last visit to Wilmington in July. But there still "is definitely sticker shock," James Parham said.

That may be because they are comparing Wilmington not to California - where they did not own - but to Russellville, Ark., where they own a home they must sell.

"My personal opinion is that (homes here) are overpriced," Parham said. "But, I'm not naive enough to believe that we can get what we had in Arkansas," adding that the differential between Arkansas and Wilmington is "at least $100,000 before we get close" to what we want.

Nevertheless, they have looked at approximately 50 houses so far, Angela Parham said. They are seeking a four-bedroom, 2 1/2-bath house in the $275,000 to $325,000 price range.

While buyers may find more reasonable prices than a year or two ago and sellers who are more willing to negotiate, lowballing doesn't work in this market, Tate said.

In fact, activity is picking up, said Jennifer Farmer, an agent with Coldwell Banker Sea Coast Realty in Wilmington.

"There's been an increase in contracts - a good turnaround," she added.

Sellers, however, "are a little more realistic in price" than previously. "I've noticed an increase in first-time buyers as well as high-end buyers," she said. The latter may find that "they can get houses on the water that they couldn't get a couple of years ago."

The job market has a role.

GE-Hitachi plans to add 900 employees at its Castle Hayne facility.

"With GE hiring so many people, a lot of strong buyers moving in," Farmer said. "I have several GE clients."

One of them is Alex Shevchenko, who moved here from Richland, Wash.

Shevchenko, originally from the Ukraine, said, "Naturally I'm falling in love with the Wilmington area. It's something you cannot find (everywhere) - evergreens, live oaks..."

Shevchenko said homes were "a little bit overpriced," when he visited Wilmington in 2006, "but right now it is not too much ... if they are sufficient quality."

He says homes here are more than $100,000 above the equivalent of his former home in south-central Washington.

Shevchenko is seeking a three-bedroom house for his wife and one of his children. Others will join him eventually from the Ukraine, he said.

With a target price of "somewhere under $400,000," he has looked at Magnolia Greens and Waterford in Leland.

But he likes Hampstead because of the schools and the convenience to his work at GE-Hitachi.

Everyone wants a bargain, but it doesn't mean buyers aren't setting their checklist standards high.

Shevchenko says he wants a FROG (family room over the garage) with its own bathroom. Among his other wants: a sunroom, screened porch, granite countertops and cherry cabinets.

Angela Parham wants a home of at least 2,300 square feet, with room to grow as they add to their family, both she and husband James agreed. "It can be up to 15 years old," she said, "but preferrably a new home, five years old or less.

"We have to have at least a half acre, four bedrooms at least," she said. "If there's a three-bedrom and there's a bonus room, we'd consider that," James Parham added.

And "now that gas is $3.50 a gallon," he said, there is another consideration - no doubt shared by many of his fellow home shoppers: distance to work.

But the Parhams are pressing ahead. "I know (sellers) are dealing. The prices have changed from July. There are a lot of foreclosed homes. We've looked at foreclosed homes," James Parham said.

"I know people who are in the housing market here and have made offers here and got them for sometimes considerably less than listed."

Meanwhile, their agent, Glenda Tate, altered their home-shopping route Thursday. The first house they were scheduled to tour was already under contract.

Small compromises can add up to big savings for buyers

Where can you get the most value for your home-buying money? You might have to compromise a bit on size or amenities, but sometimes your best bet is but a few blocks away, or a couple of miles away and in the same school district, area real estate agents say.

For instance, renovated homes in the heart of downtown's historic district "are not inexpensive," says Jenna Ault-Holcombe of Weichert Realtors Coastal Choice Downtown.

But she adds: "I think up around 15th and Nun, there are some really nice smaller houses that have been renovated. It's a nice area up there. Definitely some values up there," Alt-Holcombe said. She also suggested Carolina Heights - above 17th Street and below Carolina Place - as a neighborhood where you might find bigger homes a little less expensive than historic homes downtown.

For first-time buyers, Jennifer Farmer of Coldwell Banker Sea Coast Realty's Wilmington office points out areas like Courtney Pines and Whitney Pines, which "always sell well." The neighborhoods are off Gordon Road.

"In Courtney Pines, you get a good product" and prices start in the $170,000s, she said. In Whitney Pines, homes run $220,000 to $260,000.

Farmer cited one of her listings there as an example. "You could have a four-bedroom, three-bath with a FROG (family room over the garage) and a full bath, double-car garage, fenced backyard, open floor plan and vinyl sided" for a list price of $246,000.

Another example from Farmer, in Brookside Gardens, is listed at $249,000 and is brick-sided in a gated community. It has three bedrooms, two baths and a double garage.

Monkey Junction is the place to go, says Eliza Santos of Re/Max Coastal Properties. She cited its growth, particularly in the number of stores.

Glenda Tate of Century 21 Sweyer, however, advises potential home buyers to go back to the neighborhood they wanted last year to see if things have changed.

"If I go over to Waterford, a three-bedroom, two-bath patio home might have been $320,000 18 months ago. Now you might get if for $289,000.

Wayne Faulkner: 343-2329