Fairbanks housing market falls 23 percent
Published Monday, September 22, 2008
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Stumble It!FAIRBANKS — Paul Holyfield’s three-bedroom frame house in South Fairbanks has been on the market for nearly four months.
Holyfield put the house up for sale after moving in with his new wife. He’s frustrated that the house hasn’t sold, and he’s ready to just rent the place so he can afford to make renovations at his new house.
“It would be nice to be able to remodel here,” he said.
The Fairbanks housing market has slowed lately, with local real estate agents blaming high energy costs and shaky consumer confidence.
First American CoreLogic, a Sacramento-based company that tracks the housing market in cities across the nation, reported the number of single-family homes sold in July declined by 23 percent in Fairbanks — the same downturn as the nation’s average — when compared with July of last year. The number of houses sold decreased from 138 to 106, according to the company.
“The climate is a little soft,” said Doug Somers, vice president of the Greater Fairbanks Board of Realtors. “It probably doesn’t take a rocket scientist to see that things are slow.”
About eight months worth of inventory is sitting on the books in Fairbanks, according to another Board of Realtors official. That means it’s taking about eight months for houses to sell.
That’s a dramatic change. Before this summer, houses usually sold within eight or 12 weeks.
“Inventory is high. It’s taking longer,” Board of Realtors president Amy Krier said.
July of last year was the height of the real estate boom in Fairbanks, according to Krier. That makes comparing this July to last July somewhat tricky.
Krier pointed out that 2008 numbers are still better than 2006, which Krier characterized as an excellent year.
Still, 150 fewer houses have sold so far this year compared with last year, Krier said.
Realtors said the rising cost of owning a house, especially the cost of utilities, has turned off some buyers. A topsy-turvy economy is not helping matters.
“The economy is a self-fulfilling prophecy,” said Cullen Wallace, a past Board of Realtors president. “When people are feeling good about the economy, they’re out spending money, and that keeps the economy moving. When they’re concerned about the economy, they stop spending money and that slows things down.”
Wallace thinks the Fairbanks housing market is still strong. It’s simply adjusting after the housing boom, he said.
“I think it’s more of a return to normalcy,” he said. “It’s like a wave and it’s cresting and it’s starting to come down on the other side.”
Community Discussion
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Funny,
Just a month ago or so, real estate agents and realtors alike were filling the airwaves with commercials, assuring the housing market in Fairbanks remained high, even increasing.
I bet you my tax assessment will still go up again next year!
So my house is down 25%, fuel oil is over $4, could be a bank holiday at anytime, a needless war, food is up considerably and on and on... yet gomerAmerica want 4 more years of this insanity with a bimbo from Wasilla a heartbeat from the oval office tossed in. Hell'va job, George.
dog
Lemmings.....truth in Advertising is a myth. :) It's more of a suggestion than a steadfast law. Have a nice Monday.
it's going to fall another 20 or 30% too... It's been overpriced for a while now as well so it's going to take a strong hit during Oct-Nov-Dec...
It's not the price of houses, it's that 23% FEWER houses sold. I'm not seeing anything in the story about falling home prices. That being said, as more and more become desperate to unload unsold homes by winter, I think you'll see their home prices drop. I still think that if you have a nice, well-cared-for, energy efficient house in a good neighborhood, you'll get your price (as long as it's a fair price).
My husband and I are in the process of buying a house as we speak. After looking at about 30 houses, not to mention searching online like crazy, we decided on this specific house partly because of it's energy efficency. A 5-star rating was something we decided was mandatory. I agree with AKSoul; homes priced fairly that have been cared for will still sell.
Anybody remember 85-87?? That was a training lesson for the hard times we might be getting ready to go through.
My house has been for sale for over two years. The borough has it appraised at 167,000 snd the only offer I have had was for 125,000 guess I should have taken it. The 5 star ratings are a total joke, just ask to see the past years bills and you will see what I mean. Do you think my taxes will go down?? Lots of luck....
Yukonjohn, I do remember 85\87. I was forced to leave the state for 3 years to work... ugh.. I do remember one difference however, that being energy prices. I remember back then buying gasoline in Calif for well under a buck a gallon. This whole economic landscape in 08 hasn't played itself out yet so the price for fuel oil this year is unclear, however unless it really drops soon there could be keys once again left in doorknobs around Fairbanks and other towns this winter just like in 87. The difference however between 08 and 87 might be the busted pipes, the result of empty fuel tanks. It all depends on just how close one lives to the edge of their financial means.
As home values decline, the borough will adjust the mill rate up to compensate. Property owners actual taxes will likely keep going up. Vote yes on Proposition B to force them to reign in spending and then we will begin to see some tax relief.
I have been here since 1973, and have seen the good times and bad. Let's just all suck it up and hunker down. This mess will pass and boomtimes will return. True Alaskans are tough. The rest will sell out and go somewhere else. That's the history of the interior since ET Barnette stepped off the boat.
lemming- the people with the ads a couple months ago where not realtors, it was AHFC. The reason that they ran those ads was to let people know that the bad loans that everyone has heard so much about is not going to have the effect on our market the way it did down in the states. What they where reffering to where foreclosures, not people being scared to purchase because of what ever. The Alaska Housing Finance Corp NEVER got in on the popular funding methods that led to the mortgage crisis today (you have to have a fixed term, fixed rate, no ballon payment conventional loan to participate in their programs). They, as a lending institution, made it possible for the market up here to be sustainable for many years by exercising responsible lending.
Believe it or not, it does show. The number of houses in the area has slowed, but the average selling price has maintained and even risen a little bit. That is a balancing of the market that needed to happen due to all the homes that where built during 06 and 07. In time this too will pass and we will all move on, just like we did after 86 and 87.
One more thing about that 86/87 fiasco, the reason so many HUD homes came on the market after that was because of AHFC. They funded a lot of homes in that time and foreclosed on over 80% of those loans when so many families turned in the keys to their homes and walked away with a loss. When they get the low interest loan from HUD they had to reposses the properties and realized what a pile of junk they financed in some cases. That is why there are now Building Energy Efficency Standards used by most lenders on homes in this area (ie the five star rating). After they ate literally millions in costs they established these standards so people would not buy crap. If you decide to purchase a home that does not have as built surveys and is out of city limits you are taking a chance on what you have under the surface, behind the wall and in the attic. Take the time to hire a professional and listen to what they have to say. It could save you a lot of money.
craigo, your post is true enough but not the whole story. Here is some more... As Fed dollars dry up due to a 10 trillion dollar debt the state must take on more of the burden for federal mandated expenses as well as for the basics that uncle Ted used to bring home for us. The state, because we have a governor who feels we need to tighten our belts in these days of huge budget surpluses pass on more burden to the boroughs. The only sources of revenue they have is to tax. All the fed "tax cuts" of the last 8 years, when federal spending for the wars and every other "terrorism" issue was going through the roof has left the fed deeper in the whole then at any time since ww2. The resultant inflation of the dollar will act as an invisible tax on all of us. As our dollars grow more worthless everything will become more expensive. What is unclear is who will the people blame for all this mess.
It all comes down to bad decisions. While we decided to stick within our small budget on an older, smaller home back a decade ago, many others in our age group felt the need to go "newer and bigger." Do I ever mean bigger!
Re Borough ballot props A and B.
YOU MUST vote correctly on EACH prop.
NO on A
AND
YES on B.
Voting this way makes sure tax income from new (current and future) construction goes to reduce borough property taxes area wide. (Examples:
New construction across the street from Wal-Mart and the multi billion dollar gas line project)
Please contact your friends make sure they vote the correct way to protect the financial interest.
For details and Verification see:
http://InteriorTaxpayers.org
If we don't hang together;
we will certainly be hang separately.
Considering the actions that banks will take in giving people mortgages in the future, back to 20% down and excellent credit ratings; I doubt if the housing market will come back in this community any time soon. For those who can do it and have an intention of staying in Fairbanks, this is actually a pretty good time to buy your home. Just wait to December, when the sellers really want out, especially those who left the State already and the homes sit empty. You'll probably get a really good prices. Actually seeing zero down and owner financing, a first for Fairbanks.
I guess we all know now what happen to the 25% Mayor Whitaker said would leave this community, they couldn't sell their homes.
Free.....Is that the same "MAYOR" who gave a speech at the DNC??????
House values have been over-inflated for several years. Energy costs have been soaring. The cost of everything we buy has at least doubled in the last ten years. Wages, however, have remained stagnant. People maxed out their credit cards in the belief that the situation would improve and they could then start paying off the debt. The situation hasn't improved, and folks have run out of avenues for borrowing money. Sooner or later it all had to come crumbling down. I am surprised it took this long. We bought our current home in 1995 for $120,000. I had a brokers appraisal done last summer and it was $213,00. I would be embarassed to ask that for my house. High housing valuations are not good for the economy. It prices most people out of the market. It's great for the few who own their home free and clear and are looking to sell. They can reap quite a windfall, but for most it is just another financial burden.
I have never seen so many house for sale signs in Alaska, every single street corner has a post for sale buy owner etc...
I have been looking high and low for another house I will wait for the crash and buy two, right now looking around I truly believe 90% of the properties for sale in the interior or way over priced.
Hell I saw an 550 Sq ft custom Lowes Shed called a cabin on 3 acres of land for 100,000.00 LMAO the other day. Property is worth maybe 6 grand shed maybe 5 grand. My house in Texas sits on 20 Acres and is 2500 sq ft with 3 garages bought new for 140,000, in Alaska it'd be a million dollar home by they way they price it up here, and its built a lot better than any house I have seen up her yet.
Yeah yeah move back to Texas if your gonna complain about our wilderness tax up here LOL, truth hurts don't it! OVERPRICED, WEAK DOLLAR, and Eroded CONSUMER CONFIDENCE equals no one will be buying your house soon.. I don't need it as bad as you need to sell it, thats my motto..
Yes . . . yes. . .mmmmmmmmm Its wonderful that voters re-elected, George Bush, THE!!! Honorary President, voters should re-elected him, since he may have learned his lesson . . . wait, no he didn't! He is now trying to destroy the fabric of our ECONOMY by using TAX PAYERs money to cover the investors DEBT for their POOR decisions. RIGHT
Besides, they (VOTERS FOR BUSH (@$%#_$*&$)) Ignored common sense on economics, arent they supposed to know of economics, since they are greedy. Pointing out, The war provided our foreign country to gain large profits from Americans by increasing Petroleum Prices, NEXT: during this second term, K SECOND (2ND) term decided to keep the prices high while ALLOWING mortgage investors to make it easy for lenders to borrow money that they cannot repay. Yes Americans should be happy for this decision to vote for BUSH, and now they are gonna make the same mistake with McCain who has supported BUSH. Lets Give a Cherry Cheer for Americans being so BRIGHT
All the while, American are now suffering from their own decision and allowing BUSH to make a THIRD (3RD) mistake to allow AMERICANS pay for his bad decisions, poor lenders, bad GOVT. regulations, and trying to cover up what will be a Terrible decision to spend 400 Billion to keep the LENDERS happy. NOT TOO BRIGHT,
But, hey COME ON, AMerican should be happy for who they have chosen
Next term, let Americans actually crumble our economy by hiring McCain and that lady who is all talk, enjoy the next four years
I will have to since i am one of the Americans, GLAD I AM BRIGHT though
Morningroar have a cup of coffee before you rank. The economic mess started long before Bush, get your information from reliable sources.
Yes the Mayor went to the DNC and also put all his business property up for sale over a year ago. Wonder if he sold his property. Considering the fact that assessments are based on the sale price of the latest similar homes sold, wonder what this will do next year to the tax base that is based on inflated home sale prices now. Assessments go down, property taxes go down. Where oh where is the assembly going to get the money to pay people like Jim Dobson of FEDCO over $100,000 a year to do nothing. Where are the 5,000 jobs he promised this year, each paying $50,000 or more? Can only imagine where this community will be when the false economy created by government money collapses. Fairbanks is most likely heading for a major bust. Hang on, it going to be a bumpy road on that dog sled.
Notice that Sunday real estate monster supplement! Glad AHFC ran all those ads to let us know our market is different than all the rest.
I think the Fairbanks economy is going to get worse. Eielson AFB will come up for BRAC debate again soon enough. When Congress decides Eielson needs to be a part time warm-storage training location, we'll see 3000 folks move out. All of it's strong points of being a strategic location with a combat ready fighter unit have dissolved. The Fighter Wing at Eielson is now only a training wing. I've only been here 22 years, but I've seen more folks move out in the last year than ever before. I have no plans of leaving no matter how bad it gets, but I'm sure we'll see hard times ahead with the path the GOP has the country on these past 8 years. Earmark spending will be gone under McCain. Tough times ahead if we stay the course. Time for change!
Anyone notice oil spiked $25 a barrel due to the announcement of the bail out. $135 a barrel, and rising. here we go again. How many people never learned there was a reason people have historically built smaller housing units in the sub arctic. The Sherwood Forrest mini mansion craze brought on by transplanted California dreaming, will now become these people's night mares.
Crucible , You Could dismantle that house in Texas , ship it to Fairbanks , reassemble it and make a few hundred thousand . Ever think of that ?
I say good, home prices in Alaska are ridiculous probably out done only by California. The median income in Alaska is far below California. Maybe now us common folk will be able to afford to purchase a home at a reasonable price!!!
I came here in March of 1952 . Smoke was coming out of every 4'x8' shack . You could find nothing to rent , people were paying 2$ a night for a chair to sit or sleep in at the Nordale Hotel . There have been a lot of ups and downs here in Fairbanks since that time . If you can't stand suffering , then get out of Fairbanks . I could describe every up and down , or boom and bust , since that time . If you think there have only been good times here read the history . Now if you are going to vote in the up coming election look at the record of the candidate , not what they say or how they look . everyone should read the political history of the U.S. and the State of Alaska , then you might be able to vote with some intelligence .
WOW, It sound like alot of time to sit around and b!@%h about stuff. My house sucks and I cant sell it to some sap for 3 times what its worth, Gas is too high, food is too high, well if its so hard to live in Alaska and to call yourself an Alaskan----MOVE!! or get use to the ups and downs that everyone else calls "LIFE". I really likes the remarks of Barks--- "look at the record of the candidate, not what they say or how they look.
I should buy up as much property as I can while it's cheap, I could be a millionaire when/if the economy recovers.
Certainly Fairbanks is not going to turn into a ghost town anytime soon as the population in this country does nothing but grow grow grow, sooner or later there won't be enough housing to go around.
I've been looking for a reasonably safe, sanitary and sound house for about a year now. Nineteen out of 20 homes are just weird, slapped-together, home-built garbage houses at a palatial price. Well-built homes are snapped up in a matter of hours at escalated prices because they are so rare. It's about time realtors and assessors priced fixer-upper homes at fixer-upper prices. This isn't a real estate slide, it's a correction.
LostAlaskan, don't count on it. If the government money dries up, so do the jobs. This community is almost 60% government employees. if the money goes, so do the jobs. Fairbanks is a false economy.
Bought most of my land back in the days when you got 5 acers for fifty dollars and you could still homestead. Compared to those days, nothing today is cheap.
I cant whine too much, but its not going to stop me from whining a little...lol. I put my house on the market a few months ago, only two years old, 4 star heating, no garage...thats killing me..not even a nibble. So, I will be forced to rent it out to avoid paying double mortgages, ouch. By renting it out, I am increasing my chances of getting a bad renter trashing it, and sinking more money into to it for cleaning and repairs...I'll cross that bridge when I get to it, I had a point somewhere...oh yeah, I guess I'm forced too ride this slump out just like everybody else..here is to sucking it up and being a grown up.
Home buyers & home sellers:
You might want to look these sites over. And read on AHFC.
The International Residential Code (IRC) is a comprehensive, stand-alone residential code that creates minimum regulations for one- and two-family dwellings of three stories or less. It brings together all building, plumbing, mechanical, fuel gas, energy and electrical provisions for one- and two-family residences. The IRC also provides a prescriptive approach (i.e., a set of measures) and a performance approach (i.e., energy modeling) for determining compliance.
The International Energy Conservation Code (IECC) is a similar code which encourages energy conservation through efficiency in envelope design, mechanical systems, lighting systems and the use of new materials and techniques. The IECC is similar to the energy related components of the IRC, and is referenced within the IRC, though the two are not always identical. Each state has its own energy code requirements. State energy codes are often based on a version of MEC or IECC (e.g., the 1992 MEC, the 2001 IECC, etc.); though it is worth noting that a few states have no requirements or may only have an energy code as a recommended practice. Current state codes can be found at the Building Codes Assistance Project
http://www.energystar.gov/index.cfm?c=bl...
ENERGY STAR
http://www.energystar.gov/
http://www.energystar.gov/index.cfm?c=gl...
http://www.energystar.gov/index.cfm?c=ab...
International Code Council
The International Code Council, a membership association dedicated to building safety and fire prevention, develops the codes used to construct residential and commercial buildings, including homes and schools. Most U.S. cities, counties and states that adopt codes choose the International Codes developed by the International Code Council.
http://www.iccsafe.org/news/about/
http://www.iccsafe.org/cs/
http://www.iccsafe.org/government/
This page contains information about current energy codes in the state of Alaska.
http://www.bcap-energy.org/node/53
Alaska Adopts New Residential Energy Code
Mon, 02/04/2008 - 12:35 — Kym.Willock
On April 1, 2007, the new Alaska Building Energy Efficiency Standard became mandatory for residential construction. This standard includes the provisions of the 2006 IECC with Alaska-specific amendments and ASHRAE Standard 62.2-2004 Ventilation and Acceptable Indoor Air Quality in Low-Rise Residential Buildings.
http://www.bcap-energy.org/taxonomy/term...
See how these effects you now & in the furture.
I've never knew of or heard of an Alaskan realtor to inform either buyers or sellers on these laws. Not even this story which doesn't mention it. Loans all base on these plus your credit rating. These laws can make you a buck or take your buck depending on which side of R-ratings your property is on. R-rating increases the value of property as well as decreases loan fees even with AHFC.
Ask your congressman or senators, your realtor about who, what, where, when, how of R-ratings, see what answers you'll get after looking for yourself at those sites.
I thinks its Gov. Palins fault. O.K. I really don't but this is the only column I have read in weeks where someone is not blaming her for all the bad things in Alaska.
Sorry I left out asking your loan company or AHFC. Ask your tax man as well about tax credits & tax benefits. 2012 is not that far off when buying a house or remodeling or selling a house or a car or truck. In the near future you wont be able to buy or sell property without a R-rating. Property taxes will soon be based on R-ratings, higher a r-rating the lower the taxes & not only in Alaska but the nation & internationally. Those laws also apply to your choice of heating the property. The good thing if you buy a fixer-upper & intend to remodel to meet R-ratings there's special loans & benefits & tax cuts to do it as well as remodeling your present property to R-ratings.
People referred to Cali's house prices needs to look at the upper east coast such as NY, RI, NJ, to see prices up with the moon. Cali's housing market fell face down over a year ago & still falling. It's starting to hit Alaska now.
Gov. Palin watched property owners backs on this. If you want to point fingers at Alaska's Governors you'll have to blame the 2 before her who ignored these laws at Alaskan's expense & all of our mayors now & past ones.
Hint watch what happens with the railroad & buses & transportion in Alaska. The Fairbanks North Star Borough cannot meet transportation needs because of being out of complaince with laws for years. As for the NGL it'll be here soon with or without Trans Canada to meet mandated laws. I hope without Trans Canada; so Canada can not use & cost dollars from Alaska to meet Canada's laws on this & make Alaska meet & pay them for Canada. To many laws over lap from the US & Canada (international laws). The laws are local, Borough, State, nation, international & inter-twine on emmission laws to building laws. Fairbanks North Star Borough will cost us all for the choice of using coal among other bad choices. Why does GVEA offer the SNAP program for home owners? Because they can't meet the same laws either.
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