Work continues on a new home under construction off Hopewell Avenue in Bettendorf. CREDIT DAVE THOMPSON
Griffin Wagner and her husband, Gregory, have a lot of experience when it comes to searching for homes. In fact, she says they have far too much experience. In the past three years, the Eldridge couple have been looking to buy a home. It has been a frustrating journey. They have looked at dozens of […]
Griffin Wagner and her husband, Gregory, have a lot of experience when it comes to searching for homes. In fact, she says they have far too much experience.In the past three years, the Eldridge couple have been looking to buy a home. It has been a frustrating journey. They have looked at dozens of homes, and time after time they have been outbid or simply didn’t like what they were seeing on the housing market.“There’s a lot of bottom-of-the-barrel homes for sale right now. … I think a lot of sellers are taking advantage of the situation because they know it’s a sellers’ market,” said Ms. Wagner, who is a marketing coordinator at Eastern Iowa Community Colleges in Davenport. “Greg and I have done all the right things. … Everything is just very expensive right now. You see houses that are going to $350,000, but they need a lot of work and updates. It’s still just crazy out there.”The state of the housing market in the Quad Cities continues to be a source of frustration for many people looking to buy homes. But it continues to be good times for many homeowners who are looking to sell their homes.Many professionals involved in the local housing market – real estate professionals, homebuilders, customers and others – recently discussed the current state of the market and their predictions for the future with the QCBJ.Some of the common themes they offered include:
Last year “was nuts.” This year is getting back to what is considered “normal” in the region. (However, some say this year continues to “be nuts.”)
There continues to be a shortage of homes for sale. This lack of inventory probably will not change in the foreseeable future.
Higher interest rates have hurt home sales, but sales are still very strong. (“There’s a lot of talk about home prices down from the peak. But year over year, a lot of markets are still up,” Realtor.com Chief Economist Danielle Hale said in a recent story on Realtor.com.)
Home sales will likely pick up this spring.
The sellers’ market will likely continue for at least several years.In fact, the sellers’ market may continue until at least 2030. That’s the prediction of Ryan Windmiller, president and owner of the local home-building company, Aspen Homes in Bettendorf.Mr. Windmiller adds that the region will continue to experience a sellers’ market as long as homes are in short supply. “The housing market will stay steady to strong unless something major happens,” he said.The Aspen Homes boss said his company is keeping busy this year. Aspen Homes is currently building 37 townhomes and villas, and about 14 houses. It will start a new housing project in Eldridge this June. Aspen Homes start in the mid $200,000 range in many places, and start in the mid $300,000 in Bettendorf.His customers are clamoring for those townhomes, villas – and even high-end homes. Some of those more expensive homes in demand have a price tag of nearly $3 million.Mr. Windmiller sees the current local housing market as still strong, but it has been cooling off a bit since the last quarter of 2022. Most of last year “was just nuts” with the high demand for homes, he added.“This year will be more normal…. We’re seeing regular growth” and price inflation seems to have slowed down, he told the QCBJ.As for next year, he believes demand for homes will pick up again.Chris Beason, president of Ruhl&Ruhl Realtors, also believes home sales are still strong – and will get better this spring. But he is quick to add that 2023 is not the same as last year – and that’s not a bad thing.“Last year, buyers had to make quick decisions (when buying a house) and that’s not good,” he added.There were times in 2022 when homes on the market had five to 10 offers in a day or two, forcing buyers to make those quick decisions without getting all the needed information on the house. There were times when house sales were made without getting a home inspection.Now, with interest rates higher and the cost of buying a home more expensive, many homes are on the market a bit longer. That gives buyers more time to make better, more informed decisions, Mr. Beason added.The Ruhl & Ruhl leader said the Quad Cities housing market is still “very strong” – it’s just “normalizing” from the craziness of last year.But the rest of this year just might be a brief return to that craziness. Mr. Beason said there are still many people in the region in a wait-and-see mode when it comes to buying a house. Many people are waiting to see what happens in the home construction market; perhaps more homes will be built and add to the area’s housing inventory. Many potential homebuyers also are waiting and hoping housing prices will stabilize. “It’s been a shock to the system. … It’s a shock to people’s budgets. People are taking a step back and saying ‘Whoa,’” Mr. Beason said.He also has this advice for homebuyers: When it comes to buying a home, don’t pay attention to national headlines on the issue. Do your research on the local level.Lynsey Engels, president of Real Estate Brokerage at Mel Foster Co., said that in addition to the shocking prices, buyers face the issue of a very low inventory of houses on the market.The bottom line is, she added, the sellers’ market will continue because there are many buyers on the market, and even with higher interest rates, it’s still a good time to buy a home.The housing shortage will continue the rest of the year, but might improve in 2024, she predicts.“Next year, things may level out,” she added.Kendra Mulcahy the immediate past president of the Quad City Area Realtors group, calls this region a “unique market” with eager buyers and sellers getting ready for a very busy spring season.She adds the bottom line fact that is driving this housing market continues to center on the lack of inventory: “There are buyers and no homes,” she said.Recent buyers and other people looking for homes seem to know that fact well.For instance, Margo Nissen of Colona, faced that fact last year. Last Aug. 31, she finally closed on a 1,000-square-foot home in the small Illinois Quad Cities community after a long search and being outbid on several other homes.“People were buying houses within 48 hours after it went on the market. It was crazy. … You had to be ready to make an offer right away. They didn’t give you any time. It was literally that same day,” she said.Her advice to those searching for a home his year is this: “You have to be ready to buy right away.”Meanwhile, Ms. Wagner hopes she and her husband eventually get in a position to buy a home. They continue to look for homes in the Eldridge, Long Grove and Princeton areas, and in the $350,000 to $400,000 range. On a recent weekend, they went to five open houses.“We go to open houses and there are families after families there, and cars are lined up and down the block. … My husband and I have had conversations about whether we want to get in a bidding war over a house, which seems to be the norm these days,” she said.Her advice to homebuyers is: Don’t be picky about homes, and wait for spring.“I’m hopeful it will be better this spring,” she said. QCBJAT A GLANCE: HOME SALES AND STATS
Home sales: Existing home sales in the U.S. jumped 14.5% in February to a seasonally adjusted annual rate of 4.58 million, snapping a 12-month slide and representing the largest monthly percentage increase since July 2020 (+22.4%). Compared to one year ago, however, sales retreated 22.6%. Source: National Association of Realtors
Home prices: The median existing home sales price decreased 0.2% from the previous year to $363,000. – National Association of Realtors
Inventory: The inventory of unsold existing homes in the U.S. was unchanged from the prior month at 980,000 at the end of February, or the equivalent of 2.6 months supply at the current monthly sales pace. – National Association of Realtors
Home prices in Iowa: The median single-family home listing price in Iowa is $299,000. Iowa is tied for the eighth lowest cost in the U.S. to purchase a house with Oklahoma and Michigan. – Report in StorageCafe.com
Building a home in Iowa: The average cost of building a house in Iowa, including land and construction costs, is $460,000. – StorageCafe.com
Iowa market: In February 2023, home prices in Iowa were up 3.6% compared to last year, selling for a median price of about $202,000. On average, the number of homes sold was down 22.5% year over year. – Redfin.com
Davenport home prices: Median listing price was just below $209,000 in February for Davenport, according to the most recent data from Realtor.com.
Mortgage rates: From Feb. 9 to March 9, the 30-year fixed rate jumped 61 basis points to 6.73%, according to Freddie Mac. In late March, mortgage rates were 6.85% for a 30-year fixed rate; 6.09% for a 15-year fixed rate; 6.88% for a 30-year jumbo rate. Rates were near 3% at the start of 2021, according to bankrate.com.
Foreclosures: For January 2023, foreclosures were up 36% from a year ago and up 2% between December and January.
Construction: Single-family construction starts in the U.S. in January were down 4.3% from December, and applications for building permits declined by 1.8% from the previous month, according to data from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
Work continues on a new home under construction off Hopewell Avenue in Bettendorf. CREDIT DAVE THOMPSON
