Article published May 4, 2008

By DAVID BROOKS Staff Writer

If there really is a silver lining in every cloud, first-time buyers are playing the only upbeat note in the huge black thunderhead that is New Hampshire's housing market.

"The best buyers are those who don't own any real estate, have good credit, have cash for the down payment – they are the ones who can make deals," said Yve Hines, a real-estate agent with Re/Max Properties in Nashua.

"The first-time buyers are finally waking up and saying, 'What are we waiting for?' . . . If their credit is good, there's enough inventory for them to look at – and they don't have to compete. They have the time to decide."

That's for sure.

The latest data from the New Hampshire Association of Realtors indicates that Hillsborough County homes and condos that were sold in the first quarter of this year had been on the market an average of four months – the longest period since the group started keeping track a decade ago.

Sales and prices were dismal, too.

A total of 452 properties sold in January, February and March, by far the smallest first-quarter figure in the last decade.

The median sale price, measuring the point at which half of sales cost less and half of sales cost more, fell to 2004 levels.

This means that anybody who bought a house in southern New Hampshire during the last three years has probably seen its value go down, a fact reflected in rising foreclosure rates, which doubled in Hillsborough County last year.

At the end of 2007, 1.4 percent of the state's 203,000 mortgages were in some stage of foreclosure, putting New Hampshire in the middle of the pack nationally.

It isn't clear when the housing market will get better, either. The state's bankers predicted last summer that the credit-crunch doldrums would continue at least through this spring, but the national economy has faltered further since then.

"Consumer confidence – that seems to be at an all-time low," said Jim Lyons, president of the New Hampshire Association of Realtors. "When it rebounds, you're going to see the housing market come back pretty well."

Lyons added, however, that even perennially optimistic real estate agents don't expect a return to a boom era like the first half of this decade, when median house prices in Hillsborough County increased an average of more than 12 percent every year.

"I don't believe it will come back wildly," Lyons said. "Some of what you're seeing now is reflective of such a fast run-up (in prices). The market is sort of catching up with itself."

The obvious comparison is to the swooning housing market in the early 1990s, when home sales and prices, and particularly condominium prices, were savaged. The big difference today is the greater reliance on debt from new types of mortgages and a greater ease in borrowing against soaring home values.

"One difference between the '90s and now is that more people have tapped into their equity," Lyons said. "They were essentially using their home as a credit card."

All this would seem to make it a bad time to start a new real estate business, but not everybody agrees. Cook & Stiles Realty Group, made up of three agents who have been in Hollis for decades, just opened its doors at 14 Ash St., Hollis, last month.

"The real-estate business has always been and will be cyclical," co-owner Linda Stiles said. "I think it's a great time to start a business."

She agreed with others that the business is struggling against weak consumer confidence, undermined in part by news stories about foreclosures and weak sales.

"Buyers aren't willing to pull the trigger," she said. "There's a lot of activity on our listings, but it seems like it takes them a long time to make up their mind."

As for that silver lining, Cook & Stiles personifies it, to an extent. As a brand new company looking for a new home, it demonstrated the patience that agents urge on clients.

"This property had been on the market a long time," Stiles said. ". . . We looked in August of last year, but then the price moved down and it seemed like the time to buy."Residential Home Sales 1998-2008 These charts show information about residential home sales during the first three months of each year from 1998 to 2008, as compiled by the New Hampshire Association of Realtors.

HILLSBOROUGH COUNTY

YEAR	UNITS SOLD	PERCENT CHANGE	MEDIAN PRICE	PERCENT CHANGE	DAYS ON MARKET BEFORE SALE
1998	712	N/A	$127,500	N/A	108
1999	781	+9.7%	$137,900	+8.2%	81
2000	756	-3.2%	$152,000	+10.2%	92
2001	723	-4.4%	$182,400	+20%	53
2002	788	+9%	$203,400	+11.5%	65
2003	783	-0.6%	$230,000	+13.1%	64
2004	831	+6.1%	$250,000	+8.7%	76
2005	796	-4.2%	$277,700	+11.1%	78
2006	705	-11.4%	$277,000	-0.3%	91
2007	647	-8.2%	$269,900	-2.6%	119
2008	452	-30.1%	$250,000	-7.4%	125

“Median price” is the price at which half of sales were for more, and half were for less.
“Days on market” means number of days between the time a property was first listed and the time that it actually sold.

David Brooks can be reached at 594-5831 or dbrooks@nashuatelegraph.com.