West Virginia's real estate stable amid national recovery
CHARLESTON, W.Va. -- As real estate markets nationwide continue to show growth and recovery, West Virginia's market remains stable.
"The funny part about Charleston and the whole state, we don't really reflect national trends," said Ray Joseph, chief executive officer of the West Virginia Association of Realtors.
"We don't face the highs and lows," Joseph said. "It doesn't mean we're perfect. It just means we didn't see the giant jumps and drops."
According to date from the company CoreLogic, there were 52,000 completed foreclosures across the country in May 2013, down from 71,000 in May 2012. West Virginia ranked fourth lowest in completed foreclosures with 517 in a 12-month period ending in May 2013.
Joseph said West Virginia did not have enough foreclosures to negatively impact the regional market. However, because of the Eastern Panhandle's proximity to the Washington-Baltimore metropolitan area, their market looks more like the national market, he said.
In Charleston, home prices, including distressed homes or homes sold at a discount, increased by 3.2 percent in May 2013 compared to May 2012. In that same time period, homes nationwide, including distressed sales, increased 12.2 percent.
"One of the most positive signs we've seen in Charleston and across the state is lower inventory [of homes for sale]," Joseph said. "The large inventory we had a few years ago is fading."
Peter Minter, director of the U.S. Housing and Urban Development field office in Charleston, believes housing starts in the Charleston area.
"I think it would take a major employer moving in to trigger building new housing developments, because there is a significant supply of houses on the market in the Charleston area," Minter said. "There has to be incentives for developers to go in and develop."
As West Virginia's population continues to age, Minter would like to see more one-story homes constructed.
"Real estate was never intended to be a short-term, high-yield investment, and unfortunately a few years ago people were treating it as short-term, high-yield investment and it came crashing down," Minter said. "It's still one of the few ways to wealth for moderate income households."
West Virginia ranks in the 85 percent for nationwide homeownership, but Joseph does not think Charleston's market is stagnant. Several older buildings in downtown Charleston were renovated into apartment complexes that Joseph views as being successful. Additionally, new industry in the state is impacting the market.
"The oil and gas has also contributed to the housing boom," Joseph said. "More on the rental side than purchase side."
Oil and gas workers renting or purchasing homes that Joseph has seen are in the middle of the state.
"As that industry grows even more people will start buying, and that means they're staying."
Just east of Charleston, Allen Bell is developing a new luxury-gated community providing what he sees as a much-needed rejuvenation to the local real estate market.
"I think Charleston has needed an upscale multi-family project for a lot of years," Bell said. "It's been more than 25 years since once has been done in the Kanawha County."
Bell's company completed a feasibility study before buying the 215 acres overlooking the Kanawha Valley six weeks ago.
Property manager Michael Moses said the community would have one- and two-bedroom apartments and three-bedroom townhouses. In all, they hope to have 425 units available for rent featuring raised ceilings and granite counter tops.
Moses, who has worked in property management since 2008, said interest is already high from residents in and out of the area.
"If I put an ad in for Charleston, more so than any other place, my phone will ring off the hook," Moses said. "Everyone will say, there's nothing in Charleston, or everything is too expensive or old."
Bell Properties experienced its own boom.
"A lot of people are renting right now, especially since 2008," Moses said. "Our rentals just went crazy."
Their properties have full occupancy rates and both Bell and Moses expect the same from the new Eagle View community.
"People don't know how long they're going to work at a certain place, and its more of a transit society," Bell said. "People don't want to buy a mortgage they can get upside down on a home."
The company has 100 acres remaining for potential development, but nothing has clicked yet, he said.
"Everyone is switching more to a community where you can come home and don't have anything to do," Bell said. "Have wonderful amenities, go about your life and have a good time." Reach Caitlin Cook at firstname.lastname@example.org or 304-348-5113.