NWI home sales rebound in 2012

2013-01-18T17:45:00Z 2014-02-16T11:06:15Z NWI home sales rebound in 2012Keith Benman keith.benman@nwi.com, (219) 933-3326 nwitimes.com
January 18, 2013 5:45 pm  • 

Northwest Indiana home sales last year notched their best performance since 2007, with 7,943 homes sold in the five-county area, according to sales figures from the Greater Northwest Indiana Association of Realtors.

Last year's figure compares to 6,925 homes sold in 2011, representing a 14.7 percent boost for 2012 that comes after four years of stagnant sales.

A combination of historically low interest rates, affordable prices and an improving employment picture are driving sales, said  Pete Novak, CEO of the Greater Northwest Indiana Association of Realtors.

"It's a combination of all those things, and interest rates first and foremost," Novak said.

Realtors also are taking heart from the fact sales in higher price ranges are starting to recover at a faster rate than home sales in general, with sales in the $300,000-to-$500,000 range up 41.2 percent in 2012 compared to 2011.

"It's excellent news for us because a lot of those people stayed on the sidelines the past few years," said Bill McCabe, broker/owner at Century 21 Executive Realty in Schererville.

Not only was there a scarcity of buyers in those price ranges in previous years, there also was a scarcity of sellers.

"They delayed selling because they didn't want to have to basically give their homes away," McCabe said.

Still sales volumes in those ranges remain well below the boom years of 2005 and 2006, when total sales in all price ranges combined topped 11,000 homes for both years, according to Greater Northwest Indiana Association of Realtors' sales data.

The Greater Northwest Indiana Association of Realtors represents sales agents in Lake, Porter, LaPorte, Newton and Jasper counties.

The Chicago Association of Realtors has not yet compiled total 2012 sales figures, but 2011 continued to be one of struggle for south suburban communities, with only Lansing and South Holland locally seeing some signs of recovery.

Novak and others acknowledge the largest sales segment remains in the $100,000-to-$200,000 range, the sweet spot for most working Americans. But the renewed interest in higher price ranges is one more hopeful sign the market is recovering in Northwest Indiana, with low interest rates on home loans providing much of the push.

"There are a lot of move-up buyers," Novak said. "There is a lot of pent up demand. There were people who just put their lives on hold for two or three years.

Most home buyers are asking Realtors about low interest rates and what it means for them, according to McCabe and others. If not, then Realtors are telling them.

Interest rates last year were the lowest in the history of federally backed mortgage bundler Freddie Mac's weekly survey, with a 30-year, fixed-rate home loan averaging just 3.66 percent. That compares to an average rate of 5.42 percent in the previous decade and 7.49 percent in the decade before that.

The current rates mean many home buyers can knock hundreds of dollars off monthly mortgage payments, allowing people to move up to higher-priced homes, said Matt Evans, a Realtor with Re/Max Affiliates in Valparaiso.

"We can't assume interest rates will stay this low forever," Evans said. "And that helps the housing market, too."

Even with the significant improvement in the numbers of homes sold, in another sign of affordability, the median sales price of homes in the five counties moved up just 2.1 percent in 2012, according to the Greater Northwest Indiana Association of Realtors' sales data.

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