What is the outlook for the housing market heading into the spring and summer season, and how have persistent low interest rates affected this season's outlook?
Published May 1, 2004 | May 2004 issue
We are expecting another banner year in the residential real estate market in the Fargo area. This is due in large part to the attractive interest rates for home buyers. Low rates and special financing programs for first-time buyers have allowed first-time home buyers the ability to get on the home-buying ladder. These low rates also make it possible for move-up buyers to buy their dream home. We are also expecting a strong market in home building this spring and summer. All in all, the residential real estate market is extremely healthy in our community.
Kris Sheridan, President
Park Co./GMAC Real Estate—Fargo, N.D.
Well I believe that the residential building market is going to stay strong, especially in Rochester. We just always have a good economy down here. We're lucky because of the Mayo Clinic. Everybody still keeps getting sick. And of course interest rates don't hurt; they help that a lot. So with the low interest rates and with our economy down here, I think we're going to have a really strong market. That's what we're foreseeing. We've seen people already starting to come in our office, especially now that [the weather is] starting to get nice.
Joan DeWitz, Part Owner
DeWitz Construction—Rochester, Minn.
With the low interest rates, we have seen quite a bit of activity in our market here in west-central Wisconsin, a lot of home buying going on. We're seeing that most of the properties that are up for sale are getting full-price offers or very close to it, with minimal seller concessions. ... My anticipation is that the 30-year rate will stay probably no greater than 6, maybe 6 1/8 at the most, throughout the year; I think rates are going to be fairly steady.
Linda Reidt, Office Manager
Central States Mortgage—Eau Claire, Wis.
For my residential business, home construction looks very positive for the spring. I'm looking at probably 12 new homes to start for the vicinity; that's up for us. People are taking the low interest rates vs. the high cost of building supplies right now. The plywood market is very high, but they're saying the lower rate is a definite offset to that, and they're going ahead and building. I would say 50 percent to 60 percent of my contractors are booked through August already. The homes that are going up are mostly local residents building. Because we have so much resort area around us, I get a lot of second homes going up, on lakes, cottages and stuff like that. That isn't as promising, but the new home construction for the local family is what's going up right now.
Dave Pawlak, Manager
Forslund Building Supply—Ironwood, Mich.
The outlook is very good. Through February of this year we already have 114 residential units that have been approved for construction. Our single-family is leading the way, which has been pretty much the case the last three or four years. And last year we did the most single-family housing units in [the history of] Sioux Falls, and we're running ahead of that record this year. So I think with those still-low interest rates as well as just the economic climate in Sioux Falls for jobs, it looks very bright.
Jeff Schmitt, Assistant Director of Planning
City of Sioux Falls—Sioux Falls, S.D.
Increased home sales and booming new construction in our area have affected our office. ... More people are able to purchase homes due to low interest rates and the innovative financing that is available. As renters move into their own homes, the vacancies in the rental market have increased. Rents have also decreased due to increased vacancies. And plumbers, electricians, repairmen and contractors are harder to book as they are busy with the new construction in the area.
Linda Lane, Manager
Alan Lees Realty & Metro Property
Editor's note: Interviews were conducted in March.