Peoria area home sales down

Home sales in the Peoria area last year were down 1.4 percent from 2013, according to the Peoria Area Association of Realtors.

There were 4,883 homes sold in 2014, down slightly from the 4,952 sold in 2013, said association president Phil Harvey.

The average sale price on homes sold last year was $147,917, up from $141,215 in 2013.

In the aftermath of the November 2013 calamitous tornado strike in Tazewell County, area builders were largely tied up on rebuilding projects, said Harvey.

“Last year in Peoria, you couldn’t get a contractor,” he said.

“As the activity of rebuilding homes in Washington, East Peoria and Pekin gets closer to completion, builders will once again be available for traditional new construction,” he said.

Along with new home construction across the Peoria area, Harvey looks for more sales activity with so-called “starter homes.”

Last year, homes priced under $75,000 didn’t sell as well as homes in other price categories, he said, noting that efforts to attract first-time home buyers are on tap for 2015.

“We need to get back to young people and get them back on board with the concept of owning a home,” said Harvey. “In many cases, they may find that they’re paying more in rent than they would with a monthly house payment,” he said.

Citing college loans and credit issues as factors for prospective home buyers in their 20s and 30s, Harvey said PAAR efforts would address financing issues as well as communicating the value of home ownership.

“We need to get the word out that there are different programs available to help the first-time buyer,” he said.

One of the factors boosting confidence in 2015 is the cost of gasoline, he said. “Americans are saving $2 billion a week that wasn’t there a year ago. There’s more disposable income,” said Harvey, referring to the dramatic drop in gas prices in recent months.

There are other reasons to be optimistic about home sales in central Illinois this year, he said.

“If expected economic headwinds stick around as they should, housing will get a boost in 2015. We’re watching for movement on housing finance reform and expect interest rates to remain stable until mid-2015 when the Fed is expected to raise key federal fund rates,” said Harvey.

“I’ve spoken with agents who’ve held open houses this winter. In subzero weather, on one of the coldest days of the year, one agent told me they had nine couples coming through the house. There are more people looking,” said Harvey.

Harvey noted that inventory levels were down by year’s end. There were 2,130 homes on the market in the Peoria area at the end of December, down from 2,439 at the end of November.

“It’s all about supply and demand. The economy is coming back but, as were told at a national conference over a year ago, we’re in for a slow recovery,” he said.

When Caterpillar Inc. makes public its plans to build a new downtown Peoria headquarters, that announcement is expected to spur business activity, said Harvey. “I think you’ll see the Warehouse District will move forward. The demand for downtown residential opportunities is huge. The need is for 200 new units a year for the next five years,” he said.

The Illinois Association of Realtors just completed a three-day public policy conference at the Embassy Suites in East Peoria this week, said PAAR CEO Dallas Hancock.

“It’s a conference where Realtors from around the state learn about the latest legislative initiatives. Different committee focus on private property rights. No one else monitors that at the state and federal level,” she said.