Greater Nashua trudging through housing slump

Article published Jan 27, 2008

By ASHLEY SMITH Telegraph Staff

At first, a four-bedroom ranch on Belmont Street in Merrimack with a walkout basement and recent upgrades was on the market for $259,900 ñ just what the seller needed to recoup what she owed.

But when the property didn't move right away, and taking the vacant house off the market wasn't an option, the owner steadily lowered the price, said broker Richard Jean of Nashua's Central Realty.

It took six months and more than $50,000 in price reductions, but there's finally a pending sale for $204,900.

"It's called a short sale," Jean said. "That's what it took to get it done. And the house is in very good condition."

Flash back to just more than two years ago, and this house probably would have sold quickly and close to asking price, Jean said. That's when the market in southern New Hampshire was hot.

But along with the rest of the nation, amid an economic downturn that has some analysts talking recession, the real-estate market in Greater Nashua is on the decline after a long period of boom.Economists are predicting things will get worse - home values will continue to slide while property sits on the market longer, making the term "buyer's market" an understatement.

But local real-estate agents stress that slumps are a natural part of any cyclical market ñ real estate, like the stock market, goes through ups and downs. Other say, in historical context, this market is not all that bad.

"You can't expect the market to be the same way it always had been," said Re/Max Properties real-estate agent Lisa Waller, of Nashua. "I can tell you, the media has sensationalized it. . . . New Hampshire's really not doing that bad."

According to new figures from the New Hampshire Association of Realtors, single-family home sales in Hillsborough County took a double-digit hit for the second year in a row in 2007. There were 11,989 single-family homes sold last year, a 10 percent drop from 2006, when 13,364 homes sold.

Sales prices also dropped, but only slightly. The median sales price in 2007 was $260,800, down from $265,000 the year before.

All of this is a problem for potential sellers who don't have a lot of equity built up - namely because they purchased a property at peak price just a few years ago and the house is worth less today.

After a surge in prices from 1998 to 2004 ñ when the average home doubled in value from $127,500 to $254,702 ñ the market peaked in 2005 and has since retreated, according to the Association of Realtors.

"The biggest problem today is somebody having to sell something in order to buy something," said Dave Moran, associate broker at The Masiello Group in Nashua, adding that more buyers are requesting contingency plans that allow them to back out of a purchase if their home doesn't sell.

According to Dean Christon, president of the New Hampshire Housing Finance Authority, the current market makes it tough for people struggling to make mortgage payments to avoid foreclosure. It takes away the option of making a quick sale, he said.

But there's plenty of good news in this market for first-time buyers or anyone who doesn't have to worry about losing money on a sale- most likely because they've owned the property long enough to turn a profit. There are plenty of houses to choose from in the Nashua market, and they're often selling below asking price.

Waller said she just closed on a home that went for nearly $100,000 less than the seller originally wanted.