If the numbers are any indication, 2011 was a fairly good year for local home buyers and sellers. With the average cost of houses declining and an increase in market volume, realtors and other housing officials are pleased.
“Overall, the market has increased as far as volume of activity going on,” Bryan Kendrick, Great Smoky Mountains Association of Realtors president-elect, said. “It seems there are more buyers in the last quarter (of 2011) and starting this year. I’ve talked to realtors across Sevier County and the state of Tennessee. All of them comment that we’ve got more activity coming into the market.”
Last year some $106.1 million was spent on residential homes in Sevier County, according to Kendrick. That’s an increase from 2010’s total of just under $105. In all 668 residential homes were sold in 2011, up from 2010’s 637.
These houses stayed on the market a shorter time — about 10 days on average. “These numbers are showing us that there’s more activity going on in our residential market for Sevier County,” Kendrick said.
With the number of foreclosures leveling off after reaching a peak the last two to three years, the average price of homes decreased from $149,000 in 2010 to $141,825 in 2011. It seems this small decline was exactly what buyers were looking for.
“We’re beginning to see there’s more activity going on,” Kendrick said. “More people are coming in to buy compared to the last few years. We’re seeing a larger volume of properties being sold. There’s a positive outlook from all the agents I’m speaking with.”
Though there’s a variety of ways to finance a home purchase, conventional loans and cash deals were the most common types of transactions. In the residential market in 2010, 304 conventional loans and 240 cash deals were reported. In 2011, there were 288 loans and 288 cash purchases.
“There’s more cash investors coming into the market to purchase right now,” Kendrick said. For Kendrick, a realtor at Remax Preferred Properties in Seymour, 2011 was a successful year.
“For me personally, it was a much better year (than) 2010,” he said. That’s a statement echoed by Colonial Real Estate principal broker Vickie Stanton. “The sellers are feeling more optimistic,” she said. “(The realtors) are cautiously optimistic.”
With most buyers still looking for foreclosed homes and good deals, Stanton and other employees had a successful year. “A lot of people still want foreclosures,” she said. “That’s what they look for when they come to town.”
Last year, 42 percent of the company’s revenue and half of its transactions came from foreclosures. These buyers spent less money on homes, though it took them a bit longer to close. “Getting with the right lender is very important,” Stanton said, “because the guidelines for loaning money have become much more strict. Getting the buyer pre-qualified and to the lender early on helps the process.”
Echoing Kendrick and Stanton, Melanie Sims of Priority Real Estate in Seymour admits she too saw a market increase. “It really does vary from realtor to realtor,” she said, “but I’ve had two really great years. Sales were up in 2011. The market has definitely picked up. I’ve got no complaints at all.”
In addition to foreclosed homes, Sims has also sold a good bit of rural land. “Homeowners are looking for the deal of the century,” she said. “Buyers are looking for the most they can get for their money.
“Buyers have become more aware. (They see that) a lot of the media hype is just that—hype. Obviously some do come across a really, really good deal. (They know) that if it’s a really good deal, they have to act now. There’s not a question of waiting for another good deal to come down the pipe.”
Foreclosed homes are what most of Sims’ buyers are looking for. She warns that these deals may seem better than they actually are. “It’s like buying a repossessed car,” Sims said. “Typically they haven’t maintained it. It’s stripped down to nothing. There’s quite a lot of work to do when buying a foreclosure, for the most part. Generally, a lot of work goes into it.”
Sims sees this stream of foreclosed homes coming to an end though. She predicts fewer will come on the market as the year goes on. “There’s less now than a year ago,” she said. “2010 was pretty rough for a lot of people. Certainly the latter part of 2011 was better. I certainly believe we are coming to the end of foreclosures.”
While these ‘repossessed cars’ have held the market price of other houses down, Sims was still able to sell several million dollars worth of real estate last year. Families closed on everything from trailers on small pieces of land, single family homes averaging $75,000 a piece to large houses costing $500,000 to $1 million.
If the first month of 2012 is used as a predictor for the rest of the year, it seems Sims’ numbers will be on the rise again. Since Jan. 1, she’s already written 8 to 10 contracts. “That’s a lot,” Sims said. “Typically in this market, you wouldn’t write that many in a month. (January has) been a very busy month. Provided everything keeps going the way it’s going, it will be a very good year.”
Read more: The Mountain Press - Local real estate agents had good 2011 feel optimistic about 2012