'Slow, steady growth' in housing market expected in Cape Girardeau, Jackson

EDITOR'S NOTE: An incorrect name has been corrected in this story.

With 50 new homes built last year, Jackson's home construction has rebounded to near prerecession levels. In Cape Girardeau, however, just 32 new homes were constructed, less than half as many as in 2007.

"There are less people building now in our area than there were two years back, by a significant amount," said Jeff Martin of Realty Executives of Cape County.

Scott VanGennip of VanGennip Construction in Jackson said he built fewer homes last year than in 2009.

"With the economy, people were scared and it seemed like banks weren't lending as much," he said.

VanGennip said he's definitely seen more new houses going up in Jackson in recent months, but people are building smaller houses than they were before the recession.

Brandon Williams of Brandon O. Williams Construction Co. in Cape Girardeau, agreed people are still building, but on smaller budgets.

"In the mid-2000s, we built a lot of $300,000 to $350,000 homes, but last year most were about $250,000 or lower," Williams said.

The 50 homes built in Jackson in 2010 is up significantly from 2009 when just 35 new homes were built, according to city records. In 2007, before the recession, 62 new homes were built in Jackson.

The city of Cape Girardeau has seen a 61 percent decline in the number of new homes built since 2007, according to city records. New home construction was nearly flat in 2010 with 32 homes, compared to 34 in 2009. By contrast, in 2007, 82 new homes were built in the city of Cape Girardeau.

Part of the reason Cape Girardeau hasn't seen as many new home starts is that there isn't as much available land for smaller houses, Williams said.

One factor contributing to the construction decline is the number of sharply discounted foreclosures flooding the market as unemployment remains high and people struggle to keep up with their mortgages.

Last year there were 206 trustee deeds, a document used in the foreclosure process, filed in Cape Girardeau County, according to Scott R. Clark, recorder of deeds. That's a 27 percent increase from 2007 when only 149 trustee deeds were filed.

One in every 45 U.S. households received a foreclosure filing last year, according to RealtyTrac Inc., which publishes the largest database of foreclosure, auction and bank-owned homes in the country.

The company predicts the number of foreclosures this year to break the record set in 2010 of 2.9 million homes.

Since Jan. 1, six new trustee deeds have been filed in Cape Girardeau County, Clark said.

While foreclosure filings increased nearly 9.7 percent in 2010, compared to 2009, sales of existing homes declined about 10 percent in both Cape Girardeau and Jackson during the same period.

Last year 714 homes were sold in Cape Girardeau County with an average sales price of $145,822, about $5,000 less than the average price in 2009.

"2010 was a decent year," Martin said. "It wasn't like 2006 or 2007, but it wasn't a bad year."

Federal income tax credits for home buyers that expired April 30, 2010, helped keep spring sales strong.

"It pulled a number of sales forward, particularly for first-time home buyers," Martin said. "We saw a number of first-time home buyers take advantage but I don't know that it necessarily increased the number of home purchases."

Right now, home purchases are dependent on the employment rate and potential buyer's comfort level with the economy.

"Even if they have a job, but they're hearing at their workplace about possible layoffs, they're not going to -- and rightly so -- jump into a home purchase," Martin said.

"People are holding close to the vest until they see that other parts of the economy improve."

VanGennip, Williams and Martin are all feeling positive about the local housing market in 2011, but don't expect to see a dramatic improvement.

"You'll see some growth, but I don't know that it's going to knock the socks off anybody," Martin said. "But slow, steady growth is better than the trends we have been seeing."

mmiller@semissourian.com

388-3646

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401 Independence, Cape Girardeau, MO

101 Court Street, Jackson, MO