Saturday, November 15, 2008
Home Values Have Held Up
TULSA, OK (September 23, 2008) – The Tulsa housing market has calmed down a little and is pretty much back to normal. Listing inventory processed for the month of July 2008 decreased from a year ago 7%, and is down year-to-date -.9%. The number of homes for sale on the last day of the month increased 6.4% from the same time last year. We are seeing now exactly what we expected and predicted stated Doug Horton, President of the Northeast Oklahoma Real Estate Services. Residential closings for the month continued to trail 2007 by only -4.5%.
Its very important for Oklahomans to understand that our home values have held up, and even increased, over the past year. We are now one of the best real estate markets in the country, and are consistently in the top 10 in home value appreciation. Horton predicts that our worst time is over.
The average sales price increased from a year ago 3.6% and 2.8% year-to-date from this time last year. About this same time last year we began to hear the horror stories of the real estate market across the county; this put a lot of fear into potential buyers. The sub-prime markets dried up, practically overnight, in August of 2007. Then, the Alternate-A (stated income loans) followed suit in September, basically just disappearing. By October, we had no 100% loans of any kind available (except for VA). So, many people who could have bought homes before these financing options disappeared can no longer qualify for a home mortgage. Fortunately for home buyers, the Government has greatly enhanced the Government Insured FHA loans during 2008. FHA loans are gathering steam, and are available to many of the buyers who were shut out by the elimination of the Alternate-A conventional loans and the 100% conventional loans.
A recent report from Global Insight and National City Corp shows the historical values of the City of Tulsa since 1985 (see attachment). The Q1 of 1985 the median price of a home was $59,300.00 and the market was considered to be overvalued by 50.4% at that time. In 2008 Q1, the median home price was $102,900, undervalued by 23.2%. The report shows the Tulsa market has been undervalued since Q1 1992, and has gradually increased in undervalue to its current peak today. (The valuations are based on the median values for single-family dwelling units and are based on the 2000 Census of Housing. That point-in time Census estimate is then extrapolated, based on price indices published by the Office of Federal Housing Enterprise Oversight (OFHEO). Because OFHEO has acknowledged that these price indices overstate increases when refinance activity is strong, the valuations are further adjusted to correct for this influence.)