Home sales down a bit in county

0 Comments | La Crosse Tribune, Feb 05, 2001 | by Cahalan, Steve

Sales of existing and new homes remained strong in La Crosse County in 2000, but the number of homes sold was down slightly from 1999 because of higher mortgage interest rates and because of uncertainty about the economy late in the year.

Renee Dettmann, president of the La Crosse Area Realtors Association, and Brad Price, executive vice president of First Federal Savings Bank La CrosseMadison, said last week that interest rates have been falling, which should mean another good year despite some softness in the economy.

In 2000, Dettmann said, 945 single-family La Crosse County homes on the local Multiple Listing Service were sold, down 4.5 percent from the 989 homes sold in 1999. The average sale price in 2000 was $119,898, up 8.5 percent from $110,525 in 1999.

"I don't look at it as a dip so much," Dettmann said of the smaller number of single-family homes sold in 2000. "It was difficult to have a repeat of 1999, which was so exceptional." She also noted that the total dollar sales volume was up in 2000 from 1999 and said, "That goes back into our local economy in so many ways."

Dettmann also said the number of condominium units sold rose from 25 in 1999 to. 39 in 2000. And the number of duplexes sold rose from 55 in 1999 to 63 in 2000. "So we've diversified a little bit," she said. "I think it was because the investment market (for housing) was stronger in 2000 because of uncertainty about the stock market and more people realizing it's an investment opportunity."

Single-family home sales in the fourth quarter were "a little slower," Dettmann said, because of uncertainty about the economy and who had been elected president.

"I think they'll work hard to keep homes affordable, in what they do with interest rates and programs," Dettmann said of President George W. Bush and Federal Reserve Chairman Alan Greenspan.

Single-family home sales in La Crosse County have been strong in the past few years, she said. "That's because we've had a strong economy, low unemployment and programs available from local lenders and the state and federal governments to help move-up buyers and firsttime buyers."

Dettman also said more people are realizing that buying a home is a good investment. She noted a 1998 report from Harvard University's Joint Center for Housing Studies shows a homeowner who experiences an annual home appreciation rate of 5 percent and who makes down payment of 10 percent will generally receive a 94 percent return after owning the home only three years. After owning it five years, the rate of return increases to 225 percent, the study said.

First Federal's residential (buildings that house one to four families) lending volume in 2000 was down 17 percent from 1999, because of higher interest rates last year, Price said.

But the slowing economy and the Federal Reserve's recent cuts in interest rates have resulted in lower mortgage interest rates, Price said. He said he thinks that will translate into an increase in home sales and home construction this year, despite the soft economy.