Almost 300 houses on the market; double the normal amount

By KEVIN CHIRI

Editor and Publisher

LAPLACE – Top real estate experts in the River Region say the current housing market in the area is the worst it has been since the early 90s.

But the good news is that no one is predicting the problem to remain too long, and the expected cycles of real estate should help improve the market by some time in 2008.

In recent years, St. John Parish has had an average of between 100 to 150 homes for sale on the market, not counting new construction.

But the latest check on the area Multiple Listing for St. John Parish showed 285 homes for sale.

Top agents or brokers from local companies all agreed that is far too many for a strong market, although they say there are various factors that have brought about the slowdown in sales.

Some of the key problems in the market have come from extremely high homeowner insurance rates due to Hurricane Katrina, many buyers still holding out for high prices since the hurricane, a tightening of federal mortgage laws, and an increasing number of foreclosures coming on the market due to adjustable rates from past years, now making monthly payments too high for some.

&#8220Since last year the insurance has really hurt and I’m seeing a lot of buyers going elsewhere,” 40-year real estate veteran Malcolm Falgoust of Keller Williams said. &#8220Times are about as bad as 1984 when we had 400 houses for sale here. I’m losing one sale this week since the buyer found out he couldn’t afford the house due to the insurance being so high.”

Falgoust thinks the correction in the market will take &#8220between a year to 15 months,” but other agents and brokers think the correction may come sooner.

&#8220Even new construction has slowed down. One subdivision in Montz was hot six months ago, and now their houses are sitting there. Prices have dropped 10 percent,” he added.

Dana MacCord of Prudential said that she sees the problems mostly being tied to the adjustable rates coming back to haunt homeowners, and the mortgage rules being tightened on a federal level making it harder for some to qualify.

&#8220We are looking at a record number of foreclosures nationwide,” she said. &#8220President Bush is proposing some legislation federally to give some tax breaks to people in that situation, but it will only help for a temporary period.”

Still, MacCord calls the situation &#8220challenging, but not insurmountable.”

&#8220We haven’t let anyone go here and I just see it as a bump in the road,” she added. &#82202005 leveled the playing field for everyone, and now we’re catching up to that. It’s all a cycle and it will level off, with most experts I’ve talked to saying it might take as long as the end of ’08.”

Fran Meyers of Latter & Blum, a top local agent in St. John Parish for years, was more optimistic than most in noting &#8220our phones have started ringing more in the last two to three weeks. I actually think things will improve as soon as the first of the year.”

Meyers also was happy to note &#8220our market is still much better than much of the nation. The insurance situation has certainly hurt us, but even that should improve soon. We are still selling homes, but things are just sluggish for now.”

Two other longtime local agents, Delton Arceneaux of Arceneaux Realty, and Judy Songy of Century 21 Songy & Associates, also recognize the slump right now, but see the future improving fairly soon.

Songy said that in the early 90s there were as many as 650 houses on the market locally, due to the oil bust and so many people moving.

&#8220That took 10 years to clean up,” she said. &#8220And even though the 285 homes we have now are the most in the last five years, I think you will see things get back to normal perhaps by the end of the year.

&#8220So many people still want top dollar for their homes after Katrina, and think they can get it. But the market has settled down from that,” she said.

Arceneaux wondered how much of the insurance money for damaged homes has already run out, after many predicted a boom for St. John Parish as an affect of Hurricane Katrina.

&#8220Normally a good number for us is no more than 110 homes for sale in St. John,” he said. &#8220I’m just concerned with young people being able to afford a home now, especially with the insurance affecting things. But we’re still not as bad as the 80s and 90s, so I don’t see any cause to push the panic button.”