By Carol Cole-Frowe
The Norman Transcript

Despite the national gloom and doom in the real estate market, Norman’s real estate sales are outperforming much of the country, with more than 5,000 transactions and more than half a billion dollars in sales in 2007.

Maxine Bates, president of the 478-member Norman Board of Realtors, told city leaders at the Jan. 29 Sooner Centurion Economic Summit that the national hysteria over slowing home sales and a mortgage meltdown is comparable to Orson Welles’ infamous broadcast of War of the Worlds in 1938. The fictional broadcast panicked thousands of radio listeners into believing that Martians had landed on Earth.

“This is not the case in Oklahoma, in metro Oklahoma City and more specifically here in Norman,” Bates said. “Real, reasonable, manageable, sustainable growth — that’s Norman.”

She cautioned that doesn’t mean the Norman market is safe from the national hysteria.

“Our challenge is to keep what’s happening nationwide from causing that exact damage that we feared,” Bates said. “Real estate markets are local and unique.”
The numbers show real estate sales have held steady in Norman over the past four years with an increase in line with population growth, with the typical seasonal adjustment of lower sales in the first and fourth quarters with peak sales in the second and third quarters.

“Nothing about these sales indicates a housing bubble or an unhealthy, unsustainable demand,” she said.

Prices in the metro area showed a steady increase ranging from 3.1 percent to 8.4 percent over the past seven years, compared to some of the coastal and Las Vegas markets where prices were skyrocketing. Buyers in those markets were turning around and selling properties for huge profits after a short holding period.
“We may have had appreciation envy,” she said. “We are so much better off that that didn’t happen.”

Bates doesn’t deny that there was need for a national correction in the housing market.

“We may have shortsightedly desired that kind of gains here, but now with the wisdom of hindsight, we see how our market was actually doing much better with a slow and steady price increase,” Bates said. “Now we can happily say that no gigantic correction needs to occur.”

In Norman, fourth quarter average sales prices were $157,517, with the Oklahoma City metro coming in at $153,196, according to statistics compiled by the Oklahoma Association of Realtors.

Average sales prices for Oklahoma in the fourth quarter of 2007 were $121,492, up from 2006 at $115,332; 2005, $109,568; 2004, $100,409; and 2003, $94,570.
And interest rates are the best since 1996, running around 5.25 to 5.5 percent. Rates during the past decade ranged from 5.23 percent in 2003 to 8.33 percent in 2000.

“If you’ve got good credit and a job, you can get a loan,” she said.

The national publicity about subprime mortgages causing foreclosures hasn’t caused an increase in foreclosures locally. Foreclosures in Norman last year were at 91. There have been other recent years with higher foreclosures including 2003 and 2006, with 100 and 95 respectively.

But Bates said the mortgage industry has taken a big hit.

“Who could ever have thought it was a good idea to give a $500,000 loan to a farm worker making $14,000 a year or a 25-year loan to a 102-year-old man,” she asked. “Well, someone did. … In many markets there was a real estate bubble and it has burst with incredible force.”

The Norman Board of Realtors, through its affiliate members, is making available an information packet for anyone who may be anticipating foreclosure jeopardy. The packet will provide information about how to contact their lender for whatever options are available.

A new Web site, www.housingmarketfacts.com, has been created by the National Association of Realtors to provide consumers with information and help them make their own conclusions.

Bates said there is a fear that there will be a glut of properties for sale and that prices will drop drastically. A comparison of the inventory for the past three years shows numbers have remained pretty constant.

“I think it’s so important that we get this word out that the California and Las Vegas scary things don’t apply here,” Bates said.

Copyright © 1999-2006 cnhi, inc.