Aided by low interest rates, USDA Rural Development loans and restored consumer confidence since Hurricane Katrina, area Realtor Regina Allemand said this year is adding up to her best year in real estate deals in St. Charles Parish.
“There’s a lot more people building or subcontracting their own houses,” Allemand said. “We didn’t have as many spec houses and that was very low this year as compared to other years. We’re seeing an uptick in construction. For the last three to five years, there was a lot of vacant land available, which is now being bought up.”
Dawn Morales, area Realtor with Latter & Blum in Boutte, agreed.
“Overall, it might be better than last year,” Morales said of the parish’s real estate market.
Sales are holding steady and inventory is down, which Morales said is amounting to a seller’s market in certain price ranges. A house priced in the $225,000 to $300,000 range on both sides of the river is averaging up to 30 days on the market. Recent properties listed in this price range have sold in seven days or less.
Morales said she made the parish’s largest real estate deal on record so far this year: A 7,195 square-foot house with an in-ground pool, theater and three-vehicle garage at 18 Belle Helene Drive in Destrehan for $656,000 in August.
“New construction is going really well,” she said. “Most houses that come up in good condition and priced well are not staying on the market long at all.”
Wendy Benedetto, Realtor also with Latter & Blum, agreed market-ready houses are moving in 30 days or less.Benedetto’s hot selling spot is Alley Lane with new construction. She also pointed to “presolds” as a big seller. Ashton Plantation also has picked up considerably in new construction, she said.
“It’s a ‘presolds’ market,” she said.According to Morales, “It’s been absolutely crazy” of presold property deals she’s made in Lakewood Ridge Estates on the West Bank. “The market back there is doing extremely well. Everything is presolds with very little specs.”
Allemand also said she’s made more vacant land transactions than ever in all price ranges as more people buy lots and hire a contractor to build their houses. Rising demand drove the average house price significantly from $160,000 in January to $224,000 in September.
“There’s been a little bit of everything,” she said of the parish’s market factors. “We’ve had more commercial rentals in the second half of 2015 than we’ve probably had in over two years. I think people are more relaxed from the flood issues. We haven’t had a hurricane where we had to evacuate in the last four years – that makes a big difference – all those factors help with the housing market. That has helped because, without this, they don’t spend money on evacuating.”
Also, Allemand said parish rental rates also increased compared to surrounding parishes.
A townhouse rental in the parish has averaged $800 a month compared to $600 to $800 in surrounding parishes, which Allemand attributed to St. Charles Parish’s school system.
Despite this demand, she doesn’t see development in rental property construction. There are many requests for Section 8 housing, but she said there aren’t many property owners and landlords that offer it. Also, she said it would be nice to see a duplex of single-story rentals, especially for older residents.
As for market outlook into next year, Allemand said it will hinge on interest rates staying low, as well as the next president and Congress. The “Know Before You Owe” federally-mandated mortgage rule effective Oct. 3 also will play a role in the real estate business, which requires a buyer be more informed about a transaction and mandates a three-day review with such changes as an interest rate change or addition of a prepayment penalty.
“The major difference is the buyer must know everything of what the loan is doing,” she said. The problem is, as a seller, your closing could be pushed back three days and there’s nothing anyone can do,” she said. “The burden is on the lender through all this.”
Overall, Allemand said the market is expected to remain steady.
“We’re going into the holiday season, which traditionally slows down,” she said. “But, because of the low interest rates and programs offered such as Rural Development, we do not anticipate as drastic a decline in a seasonal slowdown.”Morales agreed.
“It’s somewhat slower overall but, this year compared to last year, I think sales are up and demand is remaining steady into the holidays,” she said. “I hope next year is as good or great as it’s been in the last two years.”
Low interest rates have driven the market and will likely do so into 2016, as well as the parish’s school system continuing to draw newcomers, Morales said. At current demand and inventory, she foresees a seller’s market with higher prices and multiple offers.
Benedetto also pointed to Rural Development loans and low interest rates as major market drivers. But she also pointed the need to have good credit for buyers to benefit from them.
“My message is if you’re considering selling, you need to get with an agent now and get it on the market,” she said of sellers taking advantage of high demand for residential property. “With our inventory being what it is, it’s time.”As to her market outlook, she expects sales to be steady the rest of this year even during the holidays.“December is a good selling month in St. Charles Parish,” Benedetto said.
According to Allemand, market factors will include flood zones and maps being revisited next year, but Allemand said the outcome will likely be more positive with the levees being built on the east and west bank. FEMA’s next move could pose concern but she said these factors overall signal the buyer is confident enough to invest in the parish again.
“For the community to stay abreast and aware of the 2017 year when FEMA redoes the flood maps, be sure you’re in tune to your flood insurance policies,” she said. “It’ll come.”