ORIGINALLY WRITTEN DON RATZLAFF
Real estate brokers in Marion County have varying conclusions about the real estate market here in 2003.
Most say sales were slow to stable in 2003, but all agree that the future looks brighter if final zoning regulations now being drawn up reflect the direction stated in county’s new comprehensive economic plan, which was approved in September 2003.
In a significant departure from past policy, the county’s comprehensive plans allows for acreages as small as five acres for new rural residences.
Prior to that change, someone wanting to build a house in the country on new residential ground had to buy a minimum of 40 acres.
“That’s the best thing that’s happened to Marion County and the possibility of us increasing our assessed value,” Delores Dalke, owner of the Real Estate Center in Hillsboro, said of the change. “More residential lots will be able to be sold and they’ll be at a size that people will want.”
The zoning regulations that will reflect the new comprehensive plan are still being drafted and, with review by several public bodies yet to come, final approval may not happen until late summer, according to David Brazil, director of zoning in Marion County.
Charles Kannady, broker at Kannady and Associates in Marion, said the former 40-acre restriction “was the stupidist mentality that this county could have ever projected.”
He admitted the new policy would help his business, but he said the entire county will gain with more residents moving in, and with a broader property valuation from the construction of new houses.
“It’s self-interest because I’d like to reduce my tax load-but everybody else does, too,” he said. “If we (encourage more rural residences), we’ve got more money coming in.”
Even though the five-acre minimum is a vast improvement, Kannady said, he would have liked to have seen acreages as small as two acres allowed for families that want to build only a house in the country.
“Two acres is God’s plenty,” Kannady said. “Most people cannot maintain more than two acres by mowing it and taking care of it. Have you ever gone out to mow two acres? It’s quite bunch of ground, equivalent to about a square block in town.”
Even so, real estate brokers in the county think there is considerable interest in building new houses in the countryside.
“Rural places carry a high price; that’s what’s in demand,” Dalke said. “Everybody wants a piece of the countryside. They want a few acres and a house, and they want trees and a creek-but they don’t want to live in a flood zone.
“I’m very excited about that,” she added. “It will be nice to have people be able to buy what they want in Marion County, build what they want, and I think the county as a whole will be pleased because people won’t be building junk houses.
“If they’re going to spend the money to buy the land, they’re going to make a real investment in our county.”
Pat Nuss, owner of Realty Specialists in Hillsboro, agrees.
“I think it will be good,” she said. “I think we’ve lost a lot of tax revenue because of this limitation. Rural people are definitely in the minority. I’m looking forward to being able to work with new construction in rural areas.”
Roger Perkins, an agent with ReMax Associates, said he has mixed feelings about the change. He sees the tax advantages for all taxpayers in the county with additional revenue from new homes, but he also has sympathies for the concerns of some farmers.
“From the ag perspective, I think it ought to stay at 40 (acres) because, unfortunately, of the 40 acres that (a buyer) needs to fulfill that obligation they only really need one-and the other 39 you wonder how conscientious and how conservation-wise they are.
“On the sale side, I think the five acres is a good thing,” Perkins added. “I have to look at from both points of view because I have to deal with both people.”
Agricultural land steady
Real estate agents pretty much agree that the market for agricultural properties has been slow-mostly because a limited number of opportunities.
“Anything that’s come up for sale has sold, and sold quite quickly,” Dalke said. “There hasn’t been a lot of land available this year, which I think would characterize this year better than anything else.”
That said, prices for agricultural land held steady for the most part.
“Prices are staying very stable, probably pretty strong,” Kannady said. “The majority of the ground is not bought by area people but by locals.”
Perkins said that some of the “outlandish” prices of a few years ago flattened out after 9/11, but land bought by outside buyers interested in acquiring hunting properties continues to bring “a premium price.”
Said Perkins: “That will probably always be because the people who buy who can afford it and the farmer can’t because of return on investment-unless Daddy or Grandpa has a bunch of money that’s laying around collecting 1 percent interest somewhere that they can invest in.”
On the other hand, Kannady said he has seen a lot of the agricultural land in his area purchased by farmers.
“If the farm economy is so bad, how come farmers are the majority of the buyers?” he asked rhetorically.
“Ag land certainly has held its value,” Nuss said. “Part of it is because the farmers had their best wheat crop in history, so I’m sure there’s a correlation. The values are very strong.”
Dalke said the market has varied a lot even within the county.
“The value of land in Marion County changes dramatically based upon location-and location includes more than where it’s at. Whom the potential buyers are has had a lot to do with it.
“There are people from outside the area that look at Marion County as a place where they want to invest their money,” she added.
“We are not nearly as volatile as some areas are. Our land is quite varied. The agriculture in Marion County also is varied. We aren’t just like a Sumner County that depends on wheat, or just a dairy county or just a beef county. We have a wide variety of land that lends itself to different kinds of agriculture and consequently it’s varied and its desirable.”
Variety in the cities
Real estate brokers in Hillsboro and Marion have different takes on the market within their respective communities.
The most positive reports come out of Hillsboro.
“I felt like it was pretty slow until October, then it started to pick up,” Nuss said about the local market. “Maybe we were fortunate; I don’t know what. We’re excited and impressed, and we think things are looking good (for 2004).”
“It’s definitely been a buyers’ market-an oversupply of property to sell,” Perkins said. “The (low) interest rate didn’t have much effect on it. We’ve had good interest rates for the past couple of years now, so everybody is upgrading- and in the case of Hillsboro there’s always movement.”
Dalke was even more upbeat.
“Hillsboro has had an absolutely tremendous market,” she said. “I see the average sales price in Hillsboro as having gone up, but I don’t have the exact numbers.”
She said the market for higher-end homes has been more active than for lower-end homes, though.
“That says people here are demanding more in their housing,” Dalke said. “The market is good; the interest rates have been low. A lot of people have refinanced and are staying where they’re at, but we look good to the outside world. People want to move here.”
Kannady acknowledges the Hillsboro market may be the most active in the county. But his evaluation of the market in Marion and across much of the county in 2003 is not as upbeat.
“I think basically over the whole county it’s been a little bit slower,” he said. “The biggest cause of that is the uncertainty of this economy.
“Interest rates are extremely good, and this should be overall a very good time to be purchasing. But overall, I think the market is a little bit stagnant.
“I think what’s happening is that for many young families, their employment situation and the amount of (consumer) debt people seem to have anymore, seems to limit their ability to qualify for loans.
“As far as a time to purchase, for a person who has a good job and a little money this could be the best time we will ever see,” Kannady added. “But overall, I think we’re as slow as we’ve seen since the ’80s.”