Hot and Cold Spots in the Anchorage Market

Well, folks, it looks like Eagle River has out danced all other districts and won the mirror ball or if  you are a hockey fan call it the Kelly Cup of real estate– at least for the first four months of this year. This bedroom community had a 17% increase in the number of single family homes sold when comparing this year to last’s sales. It had a 22% increase in sold volume and a 3% increase in average sales price, beating out all other districts in the Municipality. Eagle River is a popular area to live in for military personnel and the support employees at the joint Elmendorf-Richardson base due to its close proximity to the base.  It also is an easy commute to the UMED district.  Both UMED and the base are local economic engines that continue to reeve up. In addition to resale activity, Powder Ridge at the North Eagle River interchange and Eagle Crossing, located along Eagle River Valley, are two residential developments where new homes are being built. Sales in these two neighborhoods are reflective in a percent of list to sale ratio of plus 7% and indicate the new construction trend to market at a basic square footage price.  Buyers then pick and choose from a menu of upgrades which raises the final purchase price above the asking price.

And it’s just not single family homes that are popular in Eagle River.  The condo market in Eagle River also outpaced all other districts.  It had an 83% increase in the number of condos sold!  Total sales volume increased 124% and the average sales price increased from $190,892 to $233,573.  Days on the market decreased by 31%.  Much of this activity can be attributed to the sale of the new Dove Tree condos in downtown Eagle River plus Trails End Condos in Eagle Crossing.

Two popular Anchorage areas are not fairing as well.  Downtown Anchorage, where it seems everyone used to want to live, has had a 30% decline in condo sales, a 7% decline in sales volume and an increase of 115% for days on the market.  The most interesting statistics is the percent of list to sale which remains at 97-98 percent.  This tells us that priced right downtown properties still sell but the aging housing stock in South Addition doesn’t merit such a premium for location as it once did.  The single family sales stats don’t look much better.  It has had a 54% decline in number of units sold; a 52% decline in sold volume.  However, it has had a 3% increase in price and a 19% decline in days on the market.  Again, if priced right downtown properties still sell but a lot of homeowners’ hoping for top dollar have had their egos deflated so far this year.  I can say that because I live in South Addition!

District 30, the popular Abbott Road-DeArmoun Road area, is holding its own with a plus 3% increase in the number of units sold and only a 4 percent decrease in the average sales price. The decline in the average sales price can be directly attributed to the older, but still popular, single family neighborhoods such as Huffman Hills, Kempton Hills, Turnagain View developments.  Most of those homes, except for a few isolated lots here and there, were built in the l980’s.  That doesn’t seem like so long ago for someone like myself who’s been selling real estate for thirty years and remembers when these homes were built, but the harsh reality is these homes are now 25 to 30 years old!  Priced right these homes are still excellent buys with larger lots than what you can develop today and mature landscaping.  This district’s appeal to a new crop of home buyers is evident by the district’s 12% decline for days on the market.

Surprisingly enough, District 30, hasn’t faired as well in the condo market as it did in single family home sales.  It had a 34% decline in number of condos sold but only an 8% decline in inventory.  This is surprising due to the popularity of elementary schools in the area.  However, the average sales price only declined by one percent and days on the market only increased by 3%.  Aging inventory, coupled with nominal new construction in the district, probably accounts for this decline.

Dimond South (district 20) seems to be holding its own in condo sales.  It actually had a 36% increase in the number of condos sold which sold for 99% of list price.  The average condo price increased 9% to $235,168.  However, the average price of single family homes in the area declined by 10% from $360,433 to $321,958.  Some of that decline can be attributed to lower priced homes now being built in WestPark by Spinell and Hultquist Homes.  When originally conceived, WestPark had homes in the $400,000 to $625,000 price point.  Although Hagmeier Homes and a couple of other smaller builders continue to build in that price range, most WestPark sales are now occurring in the mid to high $300,000 price point.

But here’s a cautionary note. You can interpret  statistics at least three or four different ways.  All you have to do is watch the talking heads on TV business news to know there’s a lot of disagreement over what housing statistics really signify.  For every statistic quoted above, there is bound to be an exception  just down the street—the highest priced home in the neighborhood on the market for one day with multiple offers!  Our market is small and just one development like Dove Tree or one builder who got a heck of a good deal on single family lots can easily eschew the stats for a month or two.