The high number of foreclosed and bankruptcy homes in Iowa continue to weigh down residential prices in various local markets. For the first quarter of 2011, housing sales and prices dipped in several areas, although home construction is showing signs of improving. Housing analysts believe though, that the region's residential market is starting to improve.
Iowa City foreclosures and distressed properties in Cedar Falls and Waterloo all have effects on the region's housing prices and sales and data for the first quarter demonstrated these effects. During the January-March 2011 quarter, a total of 357 housing units were sold in the region, down from the 384 recorded in the 2010 first quarter. Median selling prices also dipped in the areas of Waterloo and Cedar Falls during the period.
According to local realtors, the presence of foreclosures for sale in Iowa has been hurting residential prices since the start of the housing crisis and these distressed properties were still cited as the main reasons for the decline in median rates in the area. During the month of March 2011, the residential median price was at $102,000, declining from the March 2010 median of $110,000. The average price of houses also decreased, with this year's average price pegged at $109,795, down from one year ago when the average selling rate was $123,753.
With a lot of distressed and bankruptcy homes to compete with, houses also stayed longer in the market during the first quarter of this year, averaging 82 days in the market compared with one year ago when the average stay was 70 days. Meanwhile, most realtors stated that they are not bothered much by the decline in sales and prices since inventories of unsold dwellings in both Waterloo and Cedar Falls have declined year-over-year by 10 to 15%.
In addition, although a lot of people prefer to buy government foreclosures and bank owned houses due to their low prices, the new home market is able to hold its own. Local housing analysts reported that construction activities in the region have picked up during the first three months of 2010. In Waterloo, 27 permits for single family houses were issued in the quarter, while Cedar Falls had 58 single family permits issued.
Analysts stated that new homes will continue to face tough competition from bargain-priced foreclosures and bankruptcy homes in the region, but demand for houses is expected to pick up soon and most of them believe that new homes will benefit from this anticipated surge.
