Feverish price rises cool off

Waterville, site of this project, was a popular area for new construction.

The Toledo area housing market for the first six months of 2003 was brisk but harsher than in years past: sellers often had to reduce their prices to get homes sold.

Buyers also drove tougher bargains on inspections and repairs because, in many cases, they were drawn into the market by historic low interest rates rather than a desperate need for a new house, say local real estate agents.

“I think sellers are still thinking on the trajectory we had in 1999 and 2000. We're still on an upward trend - a 5 percent increase in a year is pretty healthy - but sellers had hopes of 10 percent or more,” said Dan DiSalle, Jr., vice president of residential sales for the DiSalle Real Estate Co. and manager of its Perrysburg office.

Houses sold this year for an average price of $128,000, up 5 percent from a year ago, according to the Toledo Board of Realtors, which tracks sales in Lucas, Wood, and part of Fulton counties. For the first six months, 3,626 houses sold, up from 3,500 for the same period a year ago, and the value of the sales was $465 million, up from $427 million in 2002, the Realtors group said.

Housing starts also were strong, with 448 building permits issued this year in Lucas County, compared with 410 a year ago. The numbers do not include Toledo, Maumee, or Oregon.

Most construction has occurred in Sylvania and Monclova townships, with some also in Waterville and Whitehouse. Higher-end housing starts appear to be cooling; heaviest activity was in those priced $200,000 to $250,000, said John Walters, Lucas County's chief building inspector.

Selling existing homes in that price range, however, is a struggle, said Mr. DiSalle.

“While there's a 5 percent appreciation metro-wide, I've got to believe that if you looked at things by ZIP code or neighborhood or subdivision, there would be great differences,” he said. “Interest rates may be low, but the economy is spotty.”

Russ Wozniak, broker/partner at Re/Max Central Group in Sylvania Township, said the number of home sales handled by his firm is up substantially from last year, but the average sales price is down 6 percent.

Buyers are plentiful, but sellers, particularly in the over-$160,000 range, have had to lower prices to complete their deals, he said.

“The nature of the group of buyers out there this year is very conservative,” he said. “They don't have the urgent need, and they're patient to get what they want.”

Finding that out was Randy Mercural, who recently moved to Lincoln, Neb., with his wife, law professor Sandi Zellmer, who took a position at the University of Nebraska.

Having refinished the floors and spruced up their five-bedroom Old Orchard home, and aware that the neighborhood near the University of Toledo always attracts buyers, the couple said they had high hopes for a quick sale.

“We thought it was as good as or better than when we bought it, so we thought it would be fairly easily to sell,” Mr. Mercural said of the couple's house.

“We started out high, but after four or five weeks and no offers, we decided to try something in the middle of the range we had set.”

The couple dropped the price from $175,000 to $169,500, and a buyer quickly put in a bid for the 1,800-square-foot home. The final purchase price was $167,000. The home was bought for $145,500 five years ago.

More buyers in the upper-end market now are as likely to consider an existing house in such pricey areas as Ottawa Hills as to seek a newly built house, said Michael Miller, president of Sulphur Springs Realty in Toledo.