Southcentral sales, prices still strong
Prices are lower and homes stay listed longer, but the major Alaska real estate markets are still performing well compared to the rest of the nation.
So far this year, 1,065 residential properties have sold in Anchorage with an average price of $281,179 and an average 72 days on the market. There have been 487 units sold in the Matanuska-Susitna Borough at an average price of $220,464 and an average 99 days on the market.
Multiple Listings Service data shows that residential sales statewide dropped sharply after 2007 before rebounding in 2009.
As the number of units sold in Anchorage has dropped by roughly 1,000 since 2007, the average time on the market for a property has increased from 52 days to 70. Average sales prices have dropped from $3,195 below listing price to $4,745 below listing price.
Mat-Su is a strong real estate market due to its growing population and limited space in Anchorage. The average sales price in Mat-Su is $220,464 and units stay on the market an average of 99 days. This is a slightly higher price than in 2007 but homes tend to stay on the market 20 days longer on average.
Don Dyer, Mat-Su economic development director, said houses there stay on the market longer because there’s less of a constrained market than in Anchorage. He said Anchorage has more jobs but less housing availability.
“Mat-Su has more deals and variety to look at,” he said.
Kevin Cross of Cross and Associates of Keller Williams and the president of the Anchorage Board of Realtors said Mat-Su Valley areas will continue to see housing growth with the infrastructure build-up.
He said permitting problems in Anchorage will also drive the Mat-Su housing market.
Housing took a bigger hit in the Fairbanks North Star Borough. Average sales prices have dropped about 23 percent and are now staying on the market about a month longer than in 2007.
However, so far this year, time on the market in Fairbanks is down by almost 20 days versus 2011. Homes are also selling closer to listing price than they were in 2007.
According to the Alaska Housing Finance Corp., the average sales price for single-family homes fell 0.7 percent statewide.
The average 30-year interest rate is near a record-low of 3.6 percent. Although interest rates dropped, loans dropped as well.
Both single-family and condominium loans remain below the 10-year average.
Total lending activity fell statewide during the second half of 2011 in terms of number of loans, loan dollar amounts and sales volumes.
While single-family home prices fell slightly, average prices for multiple-family homes and condominiums went up a bit.
Average loan amounts rose just slightly faster than average sale prices. These lower sales prices combined with low interest rates helped affordability.
Four out of every five loans in the second half were for single-family units, while the number of loans fell 9 percent over 2010.
Anchorage had the highest average sales price for single-family homes in the state and had more than half of the single-family loan activity.
Juneau’s average price rose 3 percent to $312,197, the second-highest value in the state. The lowest average sales price was in the Kenai Peninsula Borough at $226,994.
Anchorage had 53 percent of the state’s loan dollar volume, followed by the Matanuska-Susitna Borough at 16 percent for the top two spots in the state.
In terms of all buildings, sales rose 4 percent on average in the second half of 2011 over the previous year.
Juneau climbed 3 percent in average sale prices for single-family homes and the Bethel Census Area rose 8 percent in average sale prices for single-family homes.
The total dollar value of loans for all building types statewide fell about 10 percent to $1 billion while the average loan amount went up 4 percent to $253,783.
The average loan-to-value, or LTV, ratio was 88.6 percent for all buildings statewide. This is a slight increase over the second half of 2010.
The average LTV for single-family homes went up to 91.6 percent statewide.
In other properties, condominium loan activity dropped 24 percent in the second half of 2011 over the second half of 2010 while sales prices went up. Multi-family loan activity dropped 44 percent while the number of units financed went up 18 percent.
The Alaska Affordability Index indicates that housing became more affordable statewide in the second half of 2011, according to the Alaska Housing Finance Corp.
Single-family homes were the most affordable for Mat-Su residents who were employed in Anchorage. The Juneau Borough was the least affordable of the surveyed areas.
According to the Alaska Department of Labor and Workforce Development, single-family home loans have dropped nearly 40 percent statewide between 2006 and 2011 while the average home sales price has gone up about 5 percent.
Cross said a lack of housing inventory combined with record-low interest rates are making buyers more aggressive, and that’s building the market back up.
“This is one of the best housing markets we’ve seen in five years,” he said.
Cross said 46 percent of single-family homes in Anchorage have been purchased or offers have been tendered within 30 days lately.
Cross said extremely low vacancy rates also increase housing competition and that more people are finding it cheaper and easier to buy rather than rent. This can affect inventory, however. He said sales in Wasilla and Palmer are down just more than 10 percent because there’s less inventory rather than fewer buyers.
Vicki Portwood, executive officer for the Anchorage Home Builders Association and the Alaska State Home Building Association, said Alaska is still a good market with a low foreclosure rate.
“In Alaska 34 percent own their home free and clear with no mortgage payment. That’s higher than national average,” she said.
Portwood said Alaska has a foreclosure rate of less than 6 percent and that number has remained steady.
She said a possible attributor to this is that Alaska homes don’t lose property values, which may cause fewer people to speculate on the market here.
Dyer also said the market looks to be improving. He said there have been lots of sales and refinancing after 2009.
“In Alaska, buying is different. Realtors are pretty smart about it,” he said.
He said Alaska realtors tend to secure financing and credit-worthiness first because the state has fewer realtors per buyer, which necessitates efficiency.