After a slower 2016, where does the housing market stand in New Orleans?
After record growth in the metro area housing market post-Hurricane Katrina, 2016 saw a slow-down.
Experts called it a 'leveling' off. Still, what does that means for the local housing market in 2017?
According to the New Orleans Metropolitan Association of Realtors, single-family homes sales flattened in 2016 compared to 2015, with the second half of the year seeing more of a slowdown.
Between July 1 and the end of the year, fewer homes sold and they sat longer days on the market although the overall average price ticked up slightly.
“Leveling off is Uptown, Gentilly is expanding right now,” said Delisha Boyd, a real estate broker. “There is a lot going on.”
Boyd said Gentilly is really heating up because of the new Holy Cross school campus and amenities like the new location for the Louisiana Childrens Museum in City Park.
She has sold all but two of the 40 homes in the nearby Parish Oaks subdivision.
The new construction homes were initially listed at $115 a square foot, but now are selling for $185 a square foot. New construction is also hot in Mid-City. Remax agent Martha Eager-Allen just put a home under contract with a buyer who is a so-called millennial. Eager-Allen, a millennial herself, said they look for a certain lifestyle.
“We tend to value experiences in our free time; dining drinking, hanging out with friends as well as traveling,” she explained. “The way I have seen that influences what my buyers are looking for. They look for new construction, renovations in excellent condition, homes they can move into and do nothing.”
She said millennials enjoy the outdoor recreation areas of centrally located neighborhoods like Bayou St. John and the Lafitte Greenway. Also, the type of home they are looking for is changing. Home sales for doubles are increasing and so are the prices.
“There is more demand for the doubles because the buyer can actually qualify for a little more if they are purchasing a double so if you're a young family starting out, it's ideal to buy a double that can assist you in paying your mortgage,” Eager-Allen explained.
Although the rent landlords will be able to get may not be as high as in years past.
“We've definitely seen the exit of the film industry effect properties throughout the city,” Eager-Allen said.
With more inventory and newer apartments with more amenities, rents have decreased.
“Even uptown we are seeing apartments that were leasing for maybe $1,800 last year are now sitting on the market far longer and leasing for only around $1,600,” Eager-Allen said. “So there is a correction taking place and I think owners should be aware of that.”
Boyd predicted many will take advantage of historically low mortgage rates for a 30-year fixed mortgage, around 4.25 percent, in the early part of this year, before the feds are expected to raise rates.