WASILLA — The current housing market in the Matanuska-Susitna Borough is growing and “fairly balanced” according to Eric Bushnell, 2018 president of Valley Board of Realtors and real estate agent for Lee Realty LLC, and he is hopeful that it will continue to grow in the coming years.
“Here’s the thing about the market, we keep hearing that the state of Alaska is in a recession. The Mat-Su Valley housing market is not. It’s grown,” Bushnell said.
According to his year to date findings (Jan. 1 to Oct. 22), a total 1,470 units were sold in borough, which is up 69 units, a 4.9 percent increase compared to 2017.
“That’s movement of $394,784,536,” Bushnell said.
Of that nearly $400 million, Bushnell said that approximately $30 million was pumped into the local economy, thanks to money cycling through various hands from prior to sale and afterwards, when realtors and contractors get paid and spend their money throughout the community.
“It’s a huge economic driver,” Bushnell said.
When looking at the market data, Bushnell noted that he typically looks at the long-term span and that going year-by-year or even month-by-month can yield some anomalies, but overall do not reflect the big picture. These anomalies can be anything from gas prices to bad weather.
“One year we had tons of snow and it did push a lot of the new contracts out, but when you went back and looked at it on a larger time span, there really wasn’t very much difference. But again, that month was huge. It really shut down the business,” Bushnell said. “It affects people if you’re looking at it from a monthly income standpoint. It’s huge. If you look at it from an annual standpoint it becomes insignificant.”
The national median sales price $258,100 as of September, according to Bushnell. He said that the median sales price for the borough’s market to date is $254,900, and was $219,000 in 2013, about a 16.4 percent increase. He cautioned people buying and selling homes to not confuse the median sales price with the median home price, saying these numbers are what people are actually paying for homes, not what the home are actually worth.
“Most people will look at this number and they’ll say, well the average house went up 16.4 percent and that’s not really the truth because while the market, what people are buying has gone up, yes your house is probably appreciated but like higher end homes are getting more expensive because building costs are more expensive. New homes are more expensive. Cost of construction wages, insurance, things like that are more expensive so those higher end homes have grown. The average home that they’ve lived in is going up through market appreciation. As these homes pull everything with it, they come up at a different rate but they affect this median price. Because if I sell a bunch of 5,6,7, 800 thousand dollar homes, that affects the average. The average is higher but the median, you throw out the high you throw out the low and that gives you the center. That’s what I mean by the median sale price, it’s what people are buying. It’s an important distinction for me,” Bushnell said.
Since 2013, there has been a 21.8 percent increase of total homes sold in the borough, Bushnell said.
“People would say that at that point of time , we recovered from the financial crisis,” he said. “So you could say the median of what people are spending money on, what they’re willing to purchase, they’re spending 16.4 percent more than they did five years ago. That doesn’t necessarily mean that the housing prices went up 16.4 percent it just means what they’re buying,”
Bushnell said that he did not have housing price data, “only medium sales price.”
Contact Mat-Su Valley Frontiersman reporter Jacob Mann at email@example.com