When you're out in public and some stranger notices your company or Realtor pin, you pretty well know what to expect next: “How's the market?” But since September 11, the age-old question has far more urgency, as though the person asking wants to be reassured that a trusted industry remains stable in an uncertain world.

Immediately after the terrorist attacks, real estate suffered right along with every other area of American society. What's happened to the housing market since has been the subject of innumerable surveys – from overviews of the National Association of Realtors to local reports in Realty Times (See: November 20, 2001 and November 28, 2001).

We at RE/MAX recently contacted a number of our own people in answer to NAR's industrywide requests for market information. The mid-October observations of our affiliates – primarily from the West – supplement the earlier Realty Times interviews.

Here, then, is a sample of RE/MAX views from the field, followed by a summary that includes my own reading of the market:

Arlington, Virginia

"It's an interesting market. Our MLS for Northern Virginia shows total sales down year-to-date about 200 listings from last year, but ahead of 1999 by several hundred. Average price per listing is up about $50,000 from 2000. August 15-September 15 is traditionally slower here. The September 11 event just accelerated the slowdown for a couple of weeks. It is becoming more of a buyer's market. Prices are getting back to more reasonable levels. Number-of-days-on-market is getting back up to 'normal' (30 to 45 days). Buyers are testing the market – holding back a little to see where prices go. This is the best selection of homes I've seen in 4 to 5 years. The market is being driven by interest rates and other economic factors, not September 11 and its aftermath. The upscale market is much slower; homes at $1 million or more are just sitting."

Philadelphia, Pennsylvania

“Activity declined sharply for the first few days after September 11, then went up. The market is down, probably more than it would be otherwise, but not dramatically. A couple of listings were taken off the market because sellers wanted to see how things would go.”

Toledo, Ohio

"The market is much more lively than it was the first week after the terrorism. Actually, if you look at the past few weeks compared to a year ago, our office has doubled its volume, but that may be a reflection of our particular office growth, not the market in general."

Denver, Colorado

“Showings are down dramatically. We've been averaging about 50 a day, and the norm is three times that. But that is more of a reflection of many market factors than it is only of the events on September 11 alone. About one-fourth of our agents have reported that business is very bad. The rest are doing pretty well.”

Scottsdale, Arizona

"The market is clearly much slower now. Prices have dropped about 15-20 percent from a year ago. Sellers and builders are starting to get their prices down to more realistic levels. The market was overheated prior to September 11. Perhaps the events helped calm things down. The next few months should be better because interest rates are good and there will be more rationality in the market."

Boise, Idaho

"Immediately following September 11, things were very slow, of course. But, since then I think the overall impact of those specific events will not be long-term as far as housing is concerned. The market is being driven by basic market forces. Housing sales overall are down about 20 percent from last year. It's more of a buyer's market. The upscale market (above $200,000) is particularly slow. It was taking about 30-60 days to sell a home last year. Now, it's taking more like 90-120. Sellers have to be more realistic about pricing.”

Salt Lake City, Utah

"Local traffic is off a little, but it's still basically a busy market. We've had some companies downsize locally, but a couple of new companies are moving in and that has produced relocation business for me. Any slowdown in the market seems to be the result of normal seasonal shifts, not the terrorism or related news. The upscale market is down a bit more than other niches."

Whitefish, Montana

“We discussed the situation at our board meeting yesterday. Consensus was that the market is still fundamentally strong. We have received calls from people in larger urban areas who are accelerating their plans to 'get away from it all.' Ironically, a market like ours (resort/vacation) may benefit from this in that people fear living in the big city.”

Portland, Oregon

“Immediately following September 11, the market came to a virtual halt, then slowly came back a bit. Overall, business in September was down about 20 percent from the same time last year. Lower-end market is pretty active.”

A Personal Summing Up

Given the diversity of local markets, overall trends emerge from these interviews, concurring with the experience of other real estate professionals since September 11: The market was already softening prior to the attacks, but fell immediately after – only to begin recovering once again. The number of showings dropped. The lower-end market is active while the upscale market is especially slow. Low interest rates and lower prices are aiding recovery.

As I see it, cooling off of the market earlier this year was a natural result of the record five-year boom. Real estate people had done such a good job meeting home-buyer and -seller needs during those peak years that nearly anyone who wanted to buy or sell property did. By mid-2001, demand for housing was beginning to decrease. And now, low interest rates have led to a homeowner rush to refinance to lower payments, further reducing the number of potential sales.

All this said – in spite of the slowdown of the nation's economy, the tragic events of September 11, and massive corporate layoffs – home sales in 2001 are still predicted to be the second best in real estate history. That says much – not only for the resilience of American people, but for the real estate industry itself.

So, when asked “How's the market?” you'd actually be justified in answering what they used to teach us in real estate school: “Fantastic.”

Published: November 29, 2001

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