The three words most often uttered by people in the real estate industry are location, location, location.
And, according to industry veterans in Northeast Mississippi, the region is no Florida, California or Nevada, where the real estate market has imploded as the economy has soured.
“We have to stress that the housing market here is like getting information about the weather – you don’t watch the national forecasts to get your local forecast,” said Louis Riles, vice president for the Northeast Mississippi Board of Realtors, which represents scores of Realtors in Chickasaw, Itawamba, Lee, Monroe, Pontotoc, Prentiss and Union counties.
It would be naive to think that Northeast Mississippi has been immune to the recession. More than 3,000 jobs have been shed here since 2008. Unemployment in the region sits at 11 percent.
And the area’s housing market has taken a few lumps.
For example, building permits in area communities have fallen.
In Tupelo, the number of permits issued fell 17 percent last year. Oxford saw an 8 percent drop. In Saltillo, 19 percent. But in Guntown, there was 23 percent growth.
Foreclosures, too, are relatively high. In the the area tracked by the Northeast Mississippi board, there were 366 foreclosures last year, compared to 337 a year earlier.
Selling prices remain steady
However, home sales last year totaled 1,379 homes. While that’s a 10.2 percent drop – 157 homes – from the 1,536 homes sold a year earlier, it’s only a 5.3 percent drop – 78 homes – from 2006.
More important, perhaps, the average selling price held relatively steady.
In 2006, the average price of homes sold in the area was just over $116,000. That increased to $122,428 a year later. In 2008, as the recession started to take hold, home prices dropped as expected – but only to $122,049.
“Yes, it dropped, but it’s not the double-digit declines that are being reported from elsewhere around the country,” Riles said. “Prices have moderated some, but you have to remember that home ownership is for the long term.”
You would expect real estate agents to paint a rosy picture about the housing market, but others in the industry also see better days ahead.
Take Dale and Ann Brock, who have been building and selling houses for 30 years. Their company, Brock Construction, is working on its fourth subdivision in Saltillo, which has experienced explosive residential growth in recent years.
Since 2000, nearly 800 homes have been built there.
Having weathered three other recessions, the Brocks say they’ll get through this one, too. They’re pinning their hopes on Ole Southern Plantation, a 128-lot development that has some 30 homes built so far.
“It’s been a little slow,” Ann Brock said, “but we’ve seen a lot more people out looking, and that’s a good sign.”
The Brocks have built all but a handful of the houses in the development, including three that are in various stages of construction and are for sale.
“I think things are getting better,” Ann Brock said. “If we can get some more sun, things will dry out, we can sod the lots, people can come and look at the houses … we feel things are improving.”
Tommy Morgan also sees light at the end of the tunnel. Having worked in real estate for 40 years, the owner of Coldwell Banker Tommy Morgan Realtors has gone through many ups and downs in the industry.
“From September to January, it was probably the worst period of time that I’ve ever seen,” he said.
However, buyers seem to be reentering the market.
“From February on, it’s been pretty good,” said Morgan.
Said Norma Cother, broker-owner of Crye Leike in Tupelo: “Each month seems to be getting better. I think December was the worst in our history – it was pretty bleak. December is usually slow anyway because of the holidays, but it was worse than usual.”
Morgan said it’s probably still too early to declare that the real estate market has bottomed and an upward trend has been established, but “I think there are signs pointing up.”
Some of the signs include a refinancing wave that began in the fall as mortgage rates started to fall. Rates now are at historic lows, offering unprecedented opportunity for many first-time buyers, who now also have an $8,000 tax credit available.
“If you’re buying a home for the first time, there’s really no better time than now,” said Cother.
And there are plenty of homes available, too. Some 1,260 homes are on the market in the area, including about 237 in Lee County and 407 in Tupelo.
Many real estate professionals in the area say it is a buyer’s market, where supply outstrips demand and prospective buyers, in theory, are in better negotiating position.
Morgan, however, describes Northeast Mississippi as a hybrid market of sorts.
“You have those who want to sell and those who need to sell,” he said. “It’s quite unique.”
Riles said no matter what you call the area’s housing market, one thing is clear: “I know this term gets used a lot, but it’s not all doom and gloom out there. We have a pretty stable economy around here, and that includes housing.”
Doug Vanlandingham agrees. He started V&V Paint Contractors in 2000 and said he has lost track of the number of homes and businesses his company has painted.
“The last half of the year was down, and a lot of people were doing smaller things,” he said. “We might do some work here and come back later to finish a job. So business was off some, and we were feeling the effects.
“But I feel really good about the economy. Since the first of the year, we’ve done six houses in Ole South Plantation alone. I think things are going to pick up. We’re very optimistic.”
Contact Dennis Seid at (662) 678-1578 or firstname.lastname@example.org.
Dennis Seid/Daily Journal