WASILLA — Eric Bushnell, Past President of the Valley Board of REALTORS and a Lee Realty broker, recently provided a real estate quarterly review interview with supplemental information for the Mat-Su Valley Frontiersman.
“The real estate market has a huge economic impact on the Mat-Su economy. So far this year there has been sales and leases totaling $507,523,829.00 in volume. This huge amount of money circulating through our communities generates new jobs and many growth opportunities,” Bushnell stated.
Overall, Bushnell said that the last quarter in the Valley has been “good” and it appears that people are feeling comfortable with the market.
This is the third quarter market condition report for Southcentral Alaska with an emphasis on the Valley. This report focuses mostly on the residential market.
Bushnell said there appears to be a fair amount of people moving from the Municipality of Anchorage to the Valley. He listed contributing factors such as overall lot availability, affordable housing stock and lower fuel prices.
Bushnell noted that one trend to take notice of is the total number of homes available and sold under $250,000 is dwindling, currently down by 4.3 percent or 31 less homes sold. He said that trend is a sign that home prices are going up.
The decrease of available homes under $250,000 may have increased the value within that market segment but it also decreased the affordability, according to Bushnell. He noted that while the under $250,000 segment was down, the market for homes from $250,000 to $500,000 has grown by 14.6 percent.
“This is a good indication of consumer confidence. If the sales numbers continue at this pace we may sell more residential homes this year than any previous year,” Bushnell stated.
Below is a Valley versus Anchorage real estate market comparison with year to date (YTD) data. Bushnell noted this information comes from the Alaska Multiple Listing Service, which is not guaranteed but deemed reliable.
The median price for Valley homes grew from $255,000 in 2018 to $264,000 in 2019, which is a 3.5 percent increase. The overall number of homes sold is up by 70 units, a 4.7 percent increase.
The median price for newly constructed homes grew from $330,000 in 2018 to $338,000 in 2019, which is a 2.4 percent increase. The total number of newly constructed homes sold is currently up by 1.3 percent.
“Commercial activity continues throughout the core area; from Palmer to Wasilla it’s easy to see the new commercial building going up. A majority of this new construction is owner specific, single use commercial buildings,” Bushnell said.
The YTD median price for Anchorage area homes grew by 1.3 percent, rising from $340,000 in 2018 to $344,500 in 2019. The total number of homes sold is down by 128 units, a 5.6 percent decrease.
The total number of newly constructed homes sold within the Municipality is just 75 units. New condominium sales grew by 12 units, totaling to 60 units so far.
As less land becomes available to develop, Bushnell expects a further decline of new home sales with more new condominium sales in the coming years.
The Valley’s housing market has remained stable with minor growth in some areas with slight reductions in other areas, according to Bushnell. He said that lower interest rates are fueling consumer confidence.
He said that issues tied to the state’s budget cuts have not been fully materialized and the full effects have not been felt yet.
“Productive, profitable businesses are taking this opportunity in time to improve their situation. Many are moving to new buildings, taking advantage of low interest rates. This will increase the quality of our commercial building stock in the Mat-Su Borough,” Bushnell stated.
For more information about the Valley Board of REALTORS, visit valleyboardofrealtors.org.
Contact Mat-Su Valley Frontiersman reporter Jacob Mann at email@example.com