Fresno housing market on the upswing

July 16, 2013 10:53:35 PM PDT
Construction throughout the Central Valley is picking up and home sales are rising, fast.

"We are starting to recover prices are coming back," Professor J. Andrews Hansz said.

Fresno State University Professor J. Andrews Hansz heads the Gazarian Real Estate Center at the Craig School of Business. He says even though prices are rising, the numbers are a bit deceiving.

"The median transaction price for Fresno has increased 15 to 20 percent in 2013. However, that does not mean your property has increased 15 to 20 percent," Hansz said.

Hanz says sale prices are up because many of the homes sold last year were lower priced foreclosures. Still he figures the average home has increased in value by 8 to 10 percent.

Enough to get builders busy.

"Things are improved from last year; closings from last year are up about 35 to 40 percent," Mike Prandini said.

Mike Prandini of the Building Industry Association says builders are being more cautious, with smaller subdivisions, but steady growth is expected.

"Not robust by any means but the outlook is pretty good we are very hopeful this can be sustained for at least 2014 and 15 into 16," Prandini said.

There are already signs of adjustment, for example, the median asking price of a home in Fresno shot up by $65 thousand between July of last year and today but has dropped about 2 percent in the past month.

The big difference between the median sales price of $175,000 and the asking price of $ 240,000 is because the sales started weeks ago, and the spike in asking prices has occurred in just the past couple of months. In addition, the price rise has had sellers putting more expensive homes on the market.

But Prandini says any increase in interest rates could dampen sales.

"Whenever interest rates go up you lose potential buyers," Prandini said.

However, he notes, the signs from the federal government indicate that interest rates, now between 4 and 5 percent are not likely to rise quickly and Hansz predicts the rebound will continue.

" I am not seeing any crash or big dip in the foreseeable future," Hansz said.


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