Hampton Cove, AL 4 Bdrm / 4 Bath Single Family $322,862 4 bedrooms 4 bathrooms 2,820 sqft .33 acres lot Hampton House Membership Included Built in 2006 View More Pictures and Information

The first two tenants of a proposed 16,000 sq. ft shopping center in Hampton Cove were announced this week. Hampton Cove Christian Academy and Anytime Fitness will occupy the building on the right in the picture above. The other buildings will be built when there is a demand. The center should be completed sometime this year. Last year, the owner of the property signed a deal to build a Guthrie’s restaurant there, but was met with opposition from nearby residents. Guthrie’s later decided to “never” try to locate in Hampton Cove again.

Huntsville Times Article

Decatur’s Sweetwater development, announced last week, could bring some much-needed competition to the entertainment and convention market in the region, and the VBC could use it as an excuse to go forward with a proposed expansion/renovation of its 10,000 seat arena and concert space. Sweetwater will have a 300-room hotel attached to an 80,000 sq. ft. convention center, which will be completed in 2010, with an 5,000-8,000-seat entertainment venue that will be built in a later phase. Huntsville leaders aren’t worried about the development’s impact on bringing conventions and concerts to the VBC, but they do think it will give them a little competition. The VBC has planned a expansion of the 10,000 seat arena to 13,000 and modernizing the rest of the 30-year-old complex.

Hampton Cove, AL 4 Bdrm / 4 Bath Single Family $322,862 4 bedrooms 4 bathrooms 2,820 sqft .33 acres lot Hampton House Membership Included Built in 2006 View More Pictures and Information

And this doesn’t sound right:

“John L. Morris, who started Bass in Springfield, Mo., in 1971, at one time worked with Springfield-based hotel developer John Q. Hammons to build Bass Pro Shops and Embassy Suites hotels at the same locations. Glover said he has never heard of Hammons, who developed the Embassy Suites Hotel in Huntsville.”

The “300 room, all-suites” hotel sounds a lot like an Embassy Suites, and Hammons has a reputation in the hotel industry. I don’t see how this developer doesn’t know him.

Huntsville Times article: Decatur project no big rival

Those affected by relocation assignments from the Base Realignment and Closure Commission are finding great news upon arriving in their new city: they can afford to own a home.

Hampton Cove, AL 4 Bdrm / 4 Bath Single Family $322,862 4 bedrooms 4 bathrooms 2,820 sqft .33 acres lot Hampton House Membership Included Built in 2006 View More Pictures and Information

While the national housing market is experiencing a slowing in growth, some local markets are booming, unaffected by dour predictions for the economy. As a result, individuals and families affected by BRAC are finding it easier to become homeowners, and many are surprised to find out what kind of home they can afford.

The housing market in Huntsville, Alabama is one such example. Redstone Arsenal in Huntsville is the relocation site of AMC headquarters and USASAC. The average sales price of a home in Huntsville is $189,813. Using the Home Price Comparison Index, a home of this price is equivalent to
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MONTGOMERY, Ala. (AP) — Leaders of the Senate Democratic Caucus endorsed legislation Monday that would keep state income taxes from being levied on the federal tax rebates that Alabamians are anticipating in May.

Hampton Cove, AL 4 Bdrm / 4 Bath Single Family $322,862 4 bedrooms 4 bathrooms 2,820 sqft .33 acres lot Hampton House Membership Included Built in 2006 View More Pictures and Information

Caucus leaders also announced their support for legislation that would create a tax deduction for families that participate in Alabama’s two college savings plans.

The economic stimulus package approved by Congress includes rebates of $600 to $1,200 to most taxpayers, more for those with children, and $300 checks to disabled veterans, the elderly and other low-income people.

"We want to make certain every dime of that money goes into the pockets of our Alabama families," said Sen. Parker Griffith, D-Huntsville, who is sponsoring the tax exemption legislation.

The state’s income tax rate is 5 percent for individuals, which means Griffith’s legislation would be a $60 savings on a $1,200 rebate.

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By Conor Dougherty
From The Wall Street Journal Online

The word "gentrification" conjures up images of once-poor urban neighborhoods invaded by cappuccino bars and million-dollar condos. Now, broad swaths of rural America — from New England to the Rocky Mountain West — are being gussied up, too.

Affluent retirees and other high-income types have descended on these remote areas, creating new demand for amenities like interior-design stores, spas and organic markets. For many communities, it’s the biggest change since the interstate highway system came barreling through in the 1960s and 1970s.

With the Internet allowing people to work from almost anywhere, the distinction between first and second homes has become blurred. Many people are buying retirement property while they’re still employed. Millions of soon-to-retire baby boomers, say demographers, will propel this trend for years to come.

"What we’re seeing is a class colonization," says Peter Nelson, an associate professor of geography at Middlebury College and an expert on rural migration. "It really represents a shift in the nature of the economy from a resource-extraction economy to an aesthetic-based economy."

Such change can create social tensions, as longtime residents are either driven away because they can no longer afford housing or are forced to adapt to new careers.

The impact of rural gentrification is playing out in this lakeside town, situated roughly 100 miles from Boise in Valley County. For decades it’s been home to ranchers, farmers and timber workers. It has also served as a weekend retreat for residents throughout the state who flocked to Payette Lake for summer fishing and boating.

Today, Valley County is attracting newcomers from as far away as New York and Sydney. They’re putting up second and third residences costing well over $1 million — price levels once reserved for the few waterfront properties.

In recent years, developers have snatched up land for $100,000 an acre in some cases, or 40 times what it fetched as farmland. Though home prices here are declining as in other parts of the nation, houses still cost about 60% more than in 2004.

After the close of a sawmill, an Idaho town is embracing tourism.

The influx of money is creating new jobs in hotels and restaurants as traditional industries like farming and timber fade out. Tamarack ski resort in nearby Donnelly helped super-charge growth in the area. Opened in 2004, the resort, the nation’s newest downhill ski destination, is expected to cost about $1.5 billion when fully completed in a decade or so.

Retail sales in the Valley County area increased 30% between 2003 and 2005, according to local research. New members in the McCall Chamber of Commerce include a jewelry store and two art galleries.

Jeff Bowlby, a Seattle cabinet manufacturer, has purchased three properties here over the past six years. Along the way, he’s noticed an explosion of new services and goods for sale. One local fly-fishing store, for instance, now sells rubber waders for $750 a pair. Spa del Sol offers a $125 Salmon River stone massage, using heated local stones that have been carefully selected "for their shape and energy." Remarks Mr. Bowlby: "The notion of getting a massage five years ago was pretty crazy."

City Market & Wine shop opened here about a year ago and caters to epicureans with $200 bottles of Italian Barolo and two dozen varieties of olive oil. For Thanksgiving, the store posted a sign-up sheet for organic turkeys. "Probably every Range Rover in town shops here," says Mark Colafranceschi, a Canadian transplant who owns the shop with his fiancée.

Uneven Development

Rural gentrification, and the trappings that go with it, isn’t unique to Idaho. Washington’s Methow Valley, once a logging community, now attracts cross-county skiiers. Its Twisp Municipal Airport boasts about 30 hangars for private planes, or double the number 10 years ago. Virginia’s Bath County, tucked into the Allegheny Mountains, encompasses a number of land grants given to colonists in the 1600s. A longtime favorite among hunters, boaters and fishermen, it began sprouting second homes in the 1990s.

And yet gentrification is selective. Rural America makes up about three-quarters of the nation’s land mass, but has just 17% of the population, about 50 million people. Many mining towns and Great Plains’ farming communities have stagnating or shrinking populations while more scenic communities are soaking up new residents.

One indicator of rural gentrification: An increase in residents’ total dividend, interest and rent income. That measurement, tracked by the Commerce Department, is a sign that new residents — usually retirees — are living off their investments rather than salaries. In Teton County, Wyo., home of Jackson Hole Mountain Resort, total dividend, interest and rent income has risen 177% between 1996 and 2005, one of the largest increases in rural America.

Other resort counties have seen similar increases. Eagle County, Colo., which includes Vail, has had a 109% increase in non-wage income , while Mono County, Calif., where Yosemite National Park is located, has had a 94% rise.

In Valley County and elsewhere, the influx of city money can be a challenge for rural economies. Infrastructure like roads and sewers becomes strained. Fire departments, which often rely on volunteers, don’t expand as quickly as the housing stock. and the newcomers push prices up, in some cases forcing locals to outlying towns. To lure teachers, the McCall-Donnelly Joint School District three years ago created a $250,000 housing fund , and rents apartments to teachers at subsidized rates of $500 to $1,000 a month.

But a number of veteran teachers have moved to nearby New Meadows, in adjacent Adams County, where real estate is cheaper. Kurt Dwello is one of them. A sixth-grade math and science teacher, he moved to McCall in the early 1980s and spent $40,000 building a house there. When he looked out his window, he saw an open pasture and grazing cattle. Three years ago, when he packed up for New Meadows, the view had been transformed — to one of a golf course and several new houses. "It was getting too busy here and things were getting really expensive," he says.

The area, though, has not been immune to the real-estate bust. Construction has slowed and building permits today are down. If they were to sell today, people who bought at the peak in 2005 would most likely lose money. But demographic trends indicate that people will continue coming here.

One reason: baby boomers and the previous generation are moving to rural areas in increasing numbers. Kenneth Johnson, senior demographer at the University of New Hampshire’s Carsey Institute, says 76% more people over age 50 moved to "recreation counties" — places with lots of amenities and seasonal housing — in the 1990s than in the 1980s. "This suggests that people who are now in their 50s and 60s are moving into these recreation counties more than in the past," he says.

Ripple Effects

Jim Jones is the kind of person who, without a career change, couldn’t have lived here before the Internet. Mr. Jones, a 59-year-old sales consultant, moved to McCall full-time from Issaquah, Wash. about nine months ago after tiring of traffic, people and noise. He still works a six- or seven-day week and spends a lot of time on the road. But living in McCall has its bonuses — like afternoon skiing. "It’s been discovered and that’s a good thing," he says. "Communities like this have to grow, because they’ve got too much to offer not to."

In Valley County, as with a great many gentrifying areas, some local residents are turning to the political process to try to keep the area from becoming another Aspen or Vail. Over the past few years, the McCall City Council has placed limits on chain restaurants and passed an ordinance prohibiting gated communities. A measure to increase the height limit on lakefront buildings to 50 feet from the current 35 feet was shot down.

One of the more contentious issues has been the local airport, which doesn’t yet have commercial service. Those who support the area’s changes would like to lengthen the runway and add a passenger terminal. Those against growth would prefer to see the airport stay just as it is.

"Are you going to be a government for the people who live here or are you going to be a government for the people who want to come here and develop?" says Tuck Miller , a ski coach and McCall native who recently ran for City Council and lost. "That’s what every one of these fights is about."

The ripples of gentrification can even be felt in nearby Cascade, a blue-collar town whose culture once revolved around the timber industry and the now-defunct Boise Cascade saw mill. "It used to be only locals," says Karen Cowper, a bartender at the Valley Club, which has walls adorned with mounted moose heads, a selection of hard hats and a sign that reads: "We support the timber industry."

These days, the bar is packed with construction workers and ski bums who come up to work and play. Ms. Cowper, 54 years old, says she now makes about $150 on a weekend evening — triple what she collected in tips three years ago. To keep up with changing tastes , the bar now stocks Guinness and microbrews, says Ms. Cowper, who scrawls new drink recipes on index cards and keeps them in a flip-top metal box.

She isn’t the only one learning new tricks. With the closing of the saw mill, many workers retooled their skills and moved to service jobs. Ron Lundquist, who had operated a forklift at the mill, earned a degree in hotel management.

Today, the 52-year-old is marketing director at the Ashley Inn, a new hotel in Cascade. Instead of hauling lumber from the conveyor to train, he does things like traveling to snowmobile-trade shows to promote the area. Though he misses the camaraderie of the sawmill, he says "I’m proud of what everybody has pulled together to make happen here."

Evolving Fortunes

Valley County has tracked the arc of rural gentrification. Like much of the West, its first growth spurt followed the Civil War. The Homestead Act, signed by Abraham Lincoln in 1862, provided up to 160 acres of western land to anyone willing to live on and farm it. Eastern farmers and immigrants headed west. But rural growth slowed almost as quickly as it surged.

By the turn-of-the-century, with much of the desirable western land settled, most of America’s immigrants began pouring into cities. They were joined by descendants of the original homesteaders. With mechanized farming reducing the need for labor, young people left the farm for urban jobs. The shift to the cities continued over the next several decades.

Until recently, Valley County’s economy rose and fell on farming and timber. In the 1970s, when the local timber industry was at its peak, there were five mills in the vicinity. In later decades, mills were shuttered as a result of job-displacing technology and federal limits on logging in national forests.

Rural counties gained population in the 1990s, a development that surprised demographers who dubbed it the "rural rebound." This movement continued in 2001 and after.

One area that picked up traction was Valley County. Between 2003 and 2006 , the county issued an average of 530 new housing permits a year, compared with an average of 167 a year in the previous three years. The population increased 16% to 8,836 between 2000 and 2006 , and almost all the growth was due to people moving in. Roughly 54% of the county’s homes are occupied by part-time residents.

A Fancier Playground

Valley County long has been a recreation hub. Payette Lake, a glacier lake that sits on the edge of McCall , is a summer draw for boaters and fisherman. But it’s become a lot fancier: Hotel McCall recently added a restaurant. And it replaced its room keys, which were attached to wooden buoys that could float, with plastic key cards.

Winter sports have taken on increasing importance. In 1961, the Brundage Mountain Resort opened with financing from J.R. Simplot, the billionaire potato magnate. More recently, the Tamarack Ski Resort has spent millions on magazine ads and radio commercials to broadcast the virtues of Valley County to wealthy homebuyers around the world.

People like Scott Pine have come here for good. A few years ago, Mr. Pine, a 54-year-old high-tech entrepreneur who spent his career in Silicon Valley and Seattle, began looking at homes in Bend, Ore., and Minden, Nev., near Lake Tahoe. After the opening of Tamarack, he and his wife spent $1.1 million building a four bedroom house in McCall. It sits on the ninth hole of a golf course and has views of the northern Rockies. "You have all this open space and nobody is around you," he says.

Some are finding it hard to let go of the past. Ken Roberts, an Idaho state representative, has spent his entire adult life farming hay, grass and oats on land that has been in his family since 1901. That was the year his grandfather arrived in a horse-pulled wagon whose splintered, rusted remains sit under a canopy of ponderosa and aspen pine trees on the edge of the family farm.

Now that Valley County has been discovered, the value of Mr. Roberts’s family land has shot up from about $1,500 an acre a few years ago to more than $100,000 in some places. When his mother, who is in her late 70s, passes on, he estimates the federal tax bill could exceed the total earnings of three family generations. Despite the huge tax hit, Mr. Roberts says his goal is to keep at least some of the 600 acres in the family.

"There’s 106 years of family history down there, and I love to farm," he said on a recent evening, as he sat in his truck and looked down on his land. Mr. Roberts acknowledges that his problem is a good one to have. But unless he sells the land to a developer, his family will remain land rich and cash poor.

So now he’s looking to develop certain parcels, and use the money to preserve the rest as farmland. He’s also found a way to supplement the farm’s modest income: he started a construction company.

Email your comments to rjeditor@dowjones.com.

In this month’s edition of the Market Trends Report, we will re-cap the market activity from 2007 and take a look at the real estate forecast for 2008.

Existing-home sales rose slightly in November, indicating a stabilization in housing in the wake of mortgage disruptions earlier in the year, according to the National Association of Realtors®.

Total existing-home sales nation-wide rose .4% in November 2007, when compared with October 2007, but were still down about 20% from the same time in 2006.

Looking ahead to 2008, Lawrence Yun (Senior NAR Economist) predicts “near term, existing-home sales should continue to hover in a narrow range, just as they have since September, and that’s good news because it’ll be a further sign that the housing market is stabilizing.” In further good news, he noted “mortgage interest rates are near historic lows, and the most current data shows decelerating price declines along with a modest reduction in the number of homes on the market.”

Yun reminds us, however, that “just like the weather, there are large local variations in home prices” and sales. Let’s take a look at the yearly totals for Huntsville and Madison Counties in 2007 to see what the market looked like when compared with 2006:

Huntsville/Madison County Market Statistics
The Huntsville and Madison County markets remained remarkably stable in 2007, defying many national trends.  Sales were down when compared with 2006, but only by 3%.  Average list and sale prices, however, both increased by 7% with the average home selling for $197,245 in 2007.

Average market times decreased only slightly, with the average home on the market for 79 days in 2007.  The average price per square foot of home went up 5% to $88.

If you are planning to buy or sell a home in 2008, or if you want to learn more about Huntsville AL real estate, please contact me at 256-508-0211or visit MoveToHuntsville.com. To begin searching for Huntsville AL homes, please use my complimentary MLS search.

Statistics are based on information for the North Alabama Association of Realtors and are deemed reliable but not guaranteed.

See More Hampton Cove Homes For Sale…

It’s been recently reported that an act of galactic violence never before witnessed by astronomers is occurring a few galaxies over, and while reading the story, I couldn’t help but think of the housing market.

According to astrophysicists tracking the event, a massive black hole at the center of a distant galaxy is attacking a smaller nearby galaxy using a jet of highly charged radiation. (How rude!) Black holes are areas of highly concentrated mass that exist in space. Just as the Earth has a gravitational pull that keeps us firmly planted on the ground due to its mass, black holes have a strong gravitation pull as well. There is one slight difference here though: escape velocity – the speed required to “escape” the gravitational pull of the mass in question. The Earth has an escape velocity of 25,000 mph. In order to launch an object into space from Earth, the space shuttle/rocket/paper airplane, has to go 25,000 mph or faster. The moon, a much smaller mass, has an escape velocity of 5,300 mph. A black hole’s escape velocity is faster than the speed of light. Therefore, nothing, not even light, can escape a black hole.

How are black holes created? The gravitational collapse of a star is the most common origin for this phenomenon, but scientists say black holes can be created using a particle accelerator. While experts say the chances of planetary annihilation resulting from an artificially induced black hole are miniscule, alarmist organizations such as the Lifeboat Foundation claim the danger is so imminent, we should establish “self-sustaining colonies elsewhere.” I’ll add that to my “To Do” list, but first, I’ll explain what all this has to do with real estate.

The ability to “artificially induce” a black hole makes me think of an economic concept we’ve heard a lot about lately: recession. I think that there are two types of recessions: naturally occurring recessions as economies go through normal cycles, and induced recessions, caused by fear and panic that something bad will happen.

While it is heavily reported that we are teetering on the verge of recession, this is a media succubus manufactured by scaremonger tendencies that drive content on slow news days. “Let’s see…no new information on Israel and Palestine? Hmmmm…we could report about the 375 people running for president…no, no…Wait! The housing market! Let’s talk about how bad it is! Go get an old lady who just lost her home! She’ll be great on camera!”

If you don’t believe me, you’ve never been in a newsroom staff meeting pitching story ideas.

On Thursday, December 20, 2007, the U.S. Commerce Department made an astounding discovery: things aren’t as bad as we thought. The final numbers on third quarter GDP have been reported, and the Gross Domestic Product increased 4.9%. This number is unchanged from the estimate made a month ago.

Meanwhile, media pundits are scratching their heads, asking, “Well…how did that happen? Are you sure about those numbers? Let me see that report again…”

As a result of this “surely you must be kidding” reaction from the press, the GDP statement has been reported with much skepticism and the good news is buttressed by “howevers” and “be that as it mays.”

The Associated Press article on the GDP release is a brilliant example of how to deliver good news in a way that hurts: “The U.S. economy sprinted ahead at its fastest pace in four years during the summer, although it is expected to limp through the final three months of this year as the housing and credit debacles weigh on individuals and businesses alike.”

The confusion over the 2007 third quarter good news dates back to late in 2005, when reports of housing market Armageddon started appearing.

• December 8, 2005 – USAToday: “Sustained decline forecast in U.S. housing market”
• February 28, 2006 – ABCNews: “Homes Sales Down: Is the End Near?”
• May 5, 2006 – FORTUNE Magazine: “Welcome to the dead zone” Real estate survival guide: The great housing bubble has finally started to deflate, and the fall will be harder in some markets than others.
• August 24, 2006 – The Big Picture: “Is a Housing Crisis Approaching?”
• August 27, 2006 – The Washington Post: “The Housing Crisis Goes Suburban”
• September 7, 2006 – USAToday: “Realtors forecast what home builders know: Home sales this year will tumble.”
• September 14, 2006 – USAToday: “More Fall Behind on Mortgages”
• November 2, 2006 – CNN Money Magazine: “Slow-market crisis: Stuck with two homes” Imagine you buying your dream home only to discover you’re unable to sell your current one.
• January 25, 2007 – MSNBC: “Has housing market bottomed out?” The final housing numbers for 2006 are in, and they confirm what anyone who bought or sold a home last year has suspected: It was the worst housing slump in nearly two decades.
• April 2, 2007 – The Boston Globe: “Housing Crisis Comes Knocking”
• March 11, 2007 – The New York Times: “Crisis Looms in Market for Mortgages”

While there is no doubt that many factors may have contributed to the deflation of confidence in the housing market, there is one constant factor in this supposed “crisis”: people who keep saying we’re in a crisis. If you tell everyone something is real enough times, they will start to believe it. The Earth is flat, women can’t do math, and the housing market is crashing.

So what exactly is the escape velocity that we need to propel ourselves out of the clutches of this artificially induced black hole? How do we fight a fake recession? Education at light speed! Stephen Hawking hypothesized that black holes can eventually evaporate. Maybe this fake recession will evaporate if we refuse to acknowledge that it exists.

See More Hampton Cove Homes For Sale…

Realtor.com and its companion property-search site, Move.com, were the most visited real estate Web sites in December, according to the latest numbers from Hitwise.

Realtor.com, the official site of the National Association of Realtors, retained its dominance at the top of the Hitwise rankings last month, with an 8.03 percent market share. Move.com moved up from fourth place to second place in December, with a 2.73 percent market share.

There were no newcomers to the ranks of the top 10 real estate Web sites in December, although Trulia.com came close to breaking into that elite group, Hitwise reported. Trulia moved up from 14th place to 11th place, with a 1.42 percent market share.

All told, the top 10 Web real estate Web sites accounted for 27.1 percent of all traffic in that category, Hitwise estimated, up from 24.1 percent in November.

In addition to Move.com, top 10 sites moving up in the rankings were Zillow and Rent.com, while top 10 Web sites RE/MAX Real Estate and Yahoo! Real Estate fell in Hitwise’s rankings.

Zillow’s 2.28 percent market share helped it move up one position into fourth place on the Hitwise list in December, and Rent.com also moved up one place to sixth, with a 2.12 percent market share.

RE/MAX Real Estate (2.28 percent market share) slipped from second to fifth, while Yahoo! Real Estate (2.05 percent market share) fell one position, to seventh on the list.

Hitwise reported that the top 20 real estate Web sites captured 38.8 percent of traffic in the category, compared with 36.1 percent in November.

Returning to the ranks of top 20 real estate Web sites in December was Coldwell Banker Real Estate, up two positions to 20th with a 0.87 percent market share. The Coldwell Banker site held the 11th position on the Hitwise list in September, sliding to 18th in October.

As Coldwell Banker moved back up the rankings, it bumped the Houston Association of Realtors’ official site, HAR.com, out of the top 20. Other top 20 real estate sites rising in the rankings in December were VisualTour.com, up one place to 14th with a 1.2 percent market share, and Homes.com, up one position to 15th with a 1.17 percent market share.

Continuing a recent slide in the Hitwise rankings, foreclosure tracking site RealtyTrac fell to 17th place, with a 1.16 percent market share. Last fall RealtyTrac was the second most popular real estate Web site, Hitwise estimated, before slipping to 13th place in November.

The top 100 real estate Web sites on the Hitwise list captured 68.12 percent of traffic in the category, up from 67.1 percent in November.

Moving into the top 100 were TourFactory.com (81st), Online-home-listings.com (87th), Foreclosures.com (95th), Landwatch.com (97th), Lands of America (98th), Real Estate Shows (99th), and Getmytimesharesold.com (100).

Falling out of the top 100 were Realtor Resource Center (113th), ForeclosuresToGo.com (103rd), Utah Real Estate (102nd), Just Snooping (122), Home-Listings.org (104th), RentalHomesPlus (105th) and RealtyUSA (106).

“Fast movers” — local Web sites experiencing substantial increases in rank within the category — included Furnished Quarters, up 438 places to 443rd, Pardee Homes, up 64 places to 127th, Landwatch.com, up 41 places to 97th, and Lands of South Carolina, up 372 places to 895th.

The average visit to real estate Web sites in December was 11 minutes, 38 seconds, up about 30 seconds from November.

Hitwise Real Estate Category Report, December 2007

Average prices up, buyers arriving, says Hughes

If you’re struggling to keep the "Happy" in your "New Year" while you consider whether to still buy or sell a house, then the 2007-08 market indicators may be just what you need to get happy.

"2008 is looking strong due to the economy and stability of our market in the last five years," Betty Hughes, outgoing president of the Huntsville Area Association of Realtors says of the Huntsville area housing market. "BRAC can only make this more positive."

Bill Ward, Realtor with Bill Ward Real Estate Team in Huntsville and HAAR board member, is equally encouraging about the market.

"In general, 2007 was a good year for real estate for North Alabama. We’re in real good shape compared to national sales," Ward says. "2008 will be good, too, and 2009 will be a great year."

The only problem with last year’s sales is they follow 2006 sales, which marked the best year in sales in a five-year period, he says.

Hughes says last year’s average price of a house sold ranged from $198,000 to $200,000 compared to $189,000 the previous year. That doesn’t include nearly 600 higher-end houses not reflected in MLS (multiple listing service) tracking. Some 6,281 units were sold through the MLS last year.

Ward agrees house appreciation is continuing in the area despite plummeting in other areas of the nation. Locally, it has slowed some from two years ago, he says, but that’s expected to improve as more BRAC newcomers arrive.

Now you’re wondering how this good news is possible with the national housing scene in a downturn. However, much of that is due to bursting housing bubbles in major markets like Florida and California, where skyrocketing housing prices eventually crashed. In addition to those once-stellar prices, the national housing market’s downturn was compounded by mortgage fraud and the subprime meltdown. Other markets like Michigan are tanking from losing major employers such as the auto industry to overseas migration, and from the resulting issues from an economic downturn.

Area real estate agents, brokers and lenders gratefully agree those aren’t issues for the Huntsville area because of its diverse economy, steady growth and conservative lending.

"Huntsville and Madison County are still resisting national trends," Hughes says. "It is a local market and you cannot compare all markets to national issues that are isolated in different parts of country. We have not even come close to fall in the troubled spots that others have."

That isn’t luck, but rather the result of the area’s strong leadership, she says.

"Huntville/Madison County has met the challenges needed to overcome the despair that other cities have fallen into," she says. "Builders have done an excellent job of assessing their market and pacing themselves and the need and demand. The community leaders, city government, recruitment companies, retail and developers have come together to enhance this community, knowing it is what must be done to keep it strong and moving forward."

Ward agrees, adding that a strong local economy, strong business recruitment, a highly skilled workforce, substantial high-tech base in Cummings Research Park are all factors contributing to area growth and economic resiliency. Additional factors, he says, include having the highest per capita income in the state, highly educated residents, available housing stock and a steady influx of newcomers.

Ward says interest rates are hovering at an affordable 5.75 percent, which makes it extremely attractive to buy now.

New construction prices have slightly increased but Hughes says that’s due to higher equipment costs resulting from stricter building codes, increasing materials costs for concrete, wallboard and metals like copper. The industry is also dealing with building and impact fees, affecting land development, lot costs and house prices.

"In essence, the increase in home prices is not taking advantage of new people coming in. It’s the flat-out cost incurred," she says. "Labor costs and all phases of insurance has also played into home prices."

New construction remains steady, keeping pace with demand and carefully monitoring inventory, Hughes says. Generally, buyers appear willing to spend more money per square foot to get amenities while not necessarily buying a bigger house.

A good surprise last year for Hughes "is seeing more higher-end homes available on the market - and they’re selling."

Military base realignment buyers are trickling in, yet bound to their houses which are slow to sell or not selling in weaker markets. That is affecting their ability to buy locally. But she says the forecast on their arrival is still healthy.

"We are anticipating 4,700 new residents through 2011," she says. "I feel very good the inventory will continue to be strong in all areas to chose from."

A credit crunch emerged from the subprime meltdown last year that continues to infect markets. But Hughes says the local area’s careful lending practices turned out to be the needed inoculation.

"I applaud our lending agencies for doing this," she says. "The lending institutions have also counseled their underwriters and, in turn, they have passed that on to the buyer. The guidelines have become somewhat more restricted, but business is still good. We have not fallen into the sublime mortgage crisis compared to what you are reading elsewhere."

Hughes also credits real estate agents for doing a good job of staying in "safe buying mode" for purchasers. They’re advising them not to overextend themselves financially and educating them on pitfalls with loose mortgage loans.

"Purchase power is one thing," she says. "How you use it is another thing."

Right along with wave after wave of subprime market hits came the media coverage about it, which Hughes says has been frustrating because it makes people think all housing markets are down when they’re not.

"We are in a select market and I take offense to the national connotation that we are all one," Hughes says. "Our area has worked very hard in all facets to keep our economy strong. We are very blessed and we are appreciative that stats are good. We just want people to know we are healthy, prosperous and a wonderful place to invest and live."

Sunday, January 13, 2008
By ANNA THIBODEAbr
For The Times htimes@comcast.net

U.S. home prices fell for the 10th consecutive month in October, but local real estate professionals say Pike County’s home prices have remained steady through most of 2007.

The Standard & Poor’s/Case-Shiller home price index on Wednesday reported that U.S. home prices in October posted the largest single-month drop since 1991. October also marked the 23rd consecutive month in which home prices either were below average or declined.

Industry analysts said the numbers painted a grim picture of the nation’s single-family housing market, but local realtors say Pike County is not yet feeling the full effects of the housing downturn.

“So far, the market in Troy has held its own,” said Diann Galimore, a realtor with Real Estate Associates and president of the local Board of Realtors. “We have not had many dramatic changes either way in terms of home prices.”

In 2006, Troy saw record growth in its housing market. The city set a record high for new single-family home permits last year, issuing 70 with a total value of $10,949,765. The previous record for new single-family home permits was 57 in 1994.

Galimore said the housing market has cooled since last year, both in terms of home prices and new home development.

“In 2006 we had a tremendous peak period,” Galimore said. “I would say that 2007 has come back to what we would consider normal levels.”

The S&P/Case-Shiller home price index tracks prices of existing single-family homes in 10 metropolitan areas compared to a year earlier. The index is considered a strong measure of home prices because it examines price changes of the same property over time, instead of calculating a median price of homes sold during the month.

So far, smaller housing markets like Troy’s are not feeling the housing slump as dramatically.

“We’ve been fortunate, unlike some of the larger cities … but what happens there does filter down her over a period of time,” Galimore said.

Adam Drinkwater, a realtor with Landmark Realty in Troy, said he agrees the housing market has been steady through 2007. He said Pike County’s smaller market is less susceptible to national fluctuations.

“Our number of available units is significantly lower than places like Huntsville, Birmingham or even Enterprise, which may have been overbuilt,” Drinkwater said.

Pike County’s housing market has grown, but Drinkwater said he feels the growth in housing is still keeping up with demand.

“New home sales (in 2007) have been largely consistent with the number of buyers that are looking for property,” Drinkwater said. “In larger markets, builders tend to build more units at a given time. In a smaller market, the risk is more realized in tangible ways, so builders build fewer units because there are fewer buyers.”

The broader Case-Shiller index of 20 metropolitan areas fell 6.1 percent. Among the 20 metropolitan areas used in the broader index, 11 posted record monthly declines, and all 20 declined in October compared to September.

Miami posted the largest decline among those 20 markets. Home prices in the Miami metropolitan area fell 12.4 percent in October compared to the same month last year, surpassing Tampa, Fla., as the worst-performing city. Tampa posted a year-over-year loss of 11.8 percent.

Besides those two cities, Detroit, Las Vegas, Phoenix and San Diego also posted double-digit year-over-year declines.

- The Associated Press contributed to this report.