Virus Doesn’t Slow Interest in Luxury Houses
YOUNGSTOWN, Ohio – Homebuyers looking to buy big-ticket properties – $500,000 and up – aren’t going to let the coronavirus stop them.
Across the board, the residential real estate market “is crazy right now,” says Holly Ritchie of Keller Williams Chervenic Realty, Canfield. Anything listed in the Boardman-Canfield-Poland area receives multiple offers almost upon listing, she says.
In recent weeks, Ritchie has had more showings on high-priced listings than since the start of the year – a dramatic shift from the period from March 15 to April 1 when “business was dead” because of the onset of the pandemic. Recently, a house on Fairway Drive in Canfield listed for $399,900 was under contract within seven days, Ritchie says. A property in Poland listed April 24 for $575,000 was contingent by April 28, she says.
“In the last seven days, my team alone sold 10 homes. Some of them have been sitting on the market for 120 days,” Ritchie says. “There’s nothing for sale in Canfield, Poland or Boardman in the $100,000 to $150,000 price range. If it’s in move-in condition and priced appropriately, it should go quickly.”
Although the pandemic slowed business initially, as cases of COVID-19 increased and businesses began to have employees work from their homes, the combination of low interest rates and the need for larger living spaces led many with the means to move forward on buying those properties.
“He needs an office. She needs an office. The kids are driving them crazy,” Ritchie says. “I expect every market for the next 30 to 60 days to be on fire. For the amount of homes that we’ve been selling in the last 10 days, it’s like we’ve taken off.”
The pandemic also moved some buyers off the fence, says Sue Filipovich, either to take advantage of low interest rates or move on buying a space they can enjoy with family or friends. Buyers have the mindset, “I’m going to do it now because we don’t know what is after tomorrow,” says the broker and co-owner of Burgan Real Estate in Boardman.
It’s driven interest in luxury properties, particularly in wooded areas or by lakes where homeowners can enjoy a little more privacy, Filipovich says. Burgan has seen some local interest on a $1.95 million listing on Northeast River Road in Lake Milton. The price on the four-bedroom house has recently been reduced from $2.17 million.
Erected in 2013, it sits on 0.8 acre and is custom-built using three floor plans, she says. The agency gave the listing its own web page.
“The lake is such a prominent place right now,” she says. “Even more so right now, we’ve seen nationally with buyers looking for places to purchase that are remote and vacation-like.”
According to Yes MLS, Mahoning County has 32 properties on the market priced $500,000 and above, with an average sale price of $827,000, Filipovich says. Since March 1, five have sold for a total of $2.3 million, with another three pending, totaling $1.8 million.
About the same time last year, Mahoning County recorded $3.3 million in luxury home sales, she says, so the pandemic “really hasn’t affected the pricing of the sales as of today.”
In Columbiana County, 10 luxury houses are on the market; in Trumbull County, there is one, she notes.
Between its offices in Ohio and Pennsylvania, Berkshire Hathaway HomeServices Northwood Realty Services manages the listings of about 20 luxury houses, which is up over last year, says its general manager and principal broker, Marlin Palich. He attributes it to baby boomers who built a house to rear their families and are scaling down or moving closer to their children. Others are moving closer to the Cleveland market to have cultural amenities close by, he says.
“We’re seeing a lot of people leave the suburbs and go back downtown,” Palich adds. “To be close to Playhouse Square, the West Side Market and things like that.”
A $1.25 million listing on Appaloosa Trail in Liberty Township received a pair of second showings after being featured as The Business Journal’s Home of the Week. The agency shared the listing on social media as well, attracting the attention of one of Palich’s agents in Medina, who forwarded it to a client interested in a showing.
Social media has played a critical role in real estate sales during the pandemic, with agents using Facebook Live and Zoom to host virtual tours, “so the world becomes smaller and we’re getting more interest,” he says.
While stay-at-home restrictions are being lifted in Ohio and Pennsylvania, the seller has final say on whether a home is shown in person. The owner also determines what personal protective equipment is required during a live tour. “We follow the lead of what the seller wants to do,” Palich says.
Agents practice social distancing and wear masks in accordance with state guidelines, he adds. Matterport 3D tours are an option for sellers and buyers hesitant to do a live showing.
“With today’s technology, it makes it easier for that consumer 24/7,” he says. “They’re probably going to want to see it at some point in time. But at least this gives them that taste and flair of what’s going on in that home.”
Going into the coronavirus pandemic, buyers and sellers were worried about a housing market crash similar to that in 2008, says Kim Bennett, agent with HER Realtors. But “we’re not seeing any signs that there’s going to be a housing crash” with high-end or low-end houses.
HER Realtors, based in Columbus, recently opened offices in northeastern Ohio. Bennett is a lead agent for the company and owns three offices with five agents who work in the Mahoning Valley. The agency has found some buyers don’t want to live in Cleveland, but near it, so “it gave us a good opportunity to come into this market,” she says.
HER manages 14 listings in the Mahoning Valley that range from $800,000 to nearly $1.6 million and above that are either pending, active, contingent or coming soon. In areas such as Cleveland and North Canton, houses in that range aren’t uncommon. But in the outlying areas, 14 listings is a good number during a pandemic.
“The average person is surprised how many million-dollar homes are in their areas. To have that many spread out in those counties, that’s really good,” she says. “We’re not seeing a slowdown there. And I’m not anticipating a slowdown in the high-end market.”
Still, some sellers may be hesitant to put their houses on the market because of COVID-19, Palich says. Some may have an older parent or another relative with compromised immunity who lives with them.
Others find there’s nothing in the lower-price ranges for them to move to, says KW Chervenic’s Ritchie, forcing homeowners to stay put.
“When you’re living in a $750,000 home and there’s nothing to buy, you’re not moving home with Mom and Dad,” she says.
Some luxury homeowners who have businesses forced to close because of the pandemic might be forced to sell their businesses, she says. Should that happen, Ritchie expects to see an influx of higher-priced houses, “and it will completely change the market.”
In addition, Ritchie is seeing more relocators looking to the Youngstown market.
Many of them moved away after they graduated from college to begin their careers, “and as soon as they can, they move back to be with family,” she says. If they have a job and can work from home – and their companies let them – they’re doing it.
“People want the stability of being with family; and Youngstown feels like home to them,” she says.
Burgan’s Filipovich says national forecasts show the real estate market doing a year’s worth of business in eight months. High unemployment remains a concern, she says, but qualified buyers continue to move forward and have a positive attitude.
Looking at how the year has gone since March 1, “If I were to base it off of that compared to last year, we’re pretty much right on track,” Filipovich says.
Depending on how things go, she says the market may stay the same or drop a little bit.
“But I don’t take that as much as a negative. It’s just going to be our holding pattern for a while,” she says.
Pictured at top: Luxury properties by the lake, like this one for $2,179,000 in Lake Milton, are particularly popular with buyers. Image: Burgan Real Estate.
Copyright 2023 The Business Journal, Youngstown, Ohio.