Greater Cincinnati may be experiencing one of the best buyer's housing markets in at least three years, in the midst of a slowing economy and uncertainty after the Sept. 11 terrorist attacks.

        More houses than usual are up for sale. Prices are falling, and mortgage rates are at three-year lows.

INFOGRAPHIC

• Housing sales

        In all, more than 8,000 houses were for sale as of Oct. 4, up 18 percent compared with the same day last year. Demand is greatest for homes priced at less than $250,000, houses that are attractive to first- and second-time home buyers.

        For-sale signs are planted in front of so many houses that:

        • Sellers in most neighborhoods can no longer expect multiple offers or fetch offers above asking price. Both were common two years ago.

        • Sellers are becoming more flexible on pricing. In some cases, they're dropping prices $5,000 to $10,000 to sell existing homes and move up to more expensive homes while mortgage rates are low.

        • Buyers are demanding, and getting, extras from builders, including below-market financing.

        “Interest rates are fabulous, inventory is good, and buyers and sellers are making deals happen,” says Terry Hankner, executive vice president at Comey & Shepherd Realtors in Mariemont.

        Many factors account for a robust market. Prime among them: the lowest mortgage rates in three years.

        The rates, which translate into lower monthly mortgage payments, are attracting first-time buyers for whom housing might have been out of reach before. Many local builders — including Drees, Fischer Homes and Ryland Homes — are constructing houses tailored to these buyers, adding to the number of starter homes on the market.

        Homeowners now in their first homes, too, are taking advantage of the low rates to move up to more-expensive houses.

        “That's the hottest part of the market now,” Dale Weisker, owner of Cagney Weisker & Associates on Cincinnati's west side, says of first- and second-time buyers.

        As of Tuesday, 30-year, fixed-rate mortgages were at 6.74 percent, down from 7.92 the same time a year ago. The difference means a monthly savings of about $80 for the owner of a $100,000 home.

        Low mortgage rates also are contributing to more homes for sale than buyers, real estate experts say. That's because more consumers are refinancing their homes rather than buying new houses.

        At the same time, economic uncertainty has reduced demand for houses priced at $300,000 and more. Potential buyers for those homes seem to be uncertain about the big financial commitment considering diminished stock prices, corporate layoffs and other job-security concerns, real estate experts say.

        All of which makes for intense home-buying negotiations.

        “Right now, negotiations are real fierce because neither party wants to give up their positions,” says Mike Wolfer, owner of ReMax Unlimited, with offices in Anderson Township, Montgomery and West Chester.

        Chris and Melissa Meyer discovered just that when they sold their home in Independence in July for $143,000 — down from their listing price of $149,900. The sale allowed the couple to have a new home built for more than twice that price in Crittenden.

        Mr. Meyer, owner of Douglas & Meyer Appraisal Services in Anderson Township, says all three buyers who looked at his previous home demanded a lower price. He and his wife eventually knocked off $6,900 because they needed the equity to make a down payment on the new home and didn't want to carry two mortgages.

        This pressure on sellers might start to be reflected in moderating housing prices — in contrast to the '90s, when homes were appreciating faster and sellers typically got what they asked.

        Mr. Weisker, who also is president of the Cincinnati Area Board of Realtors, predicts a slight decline in the home appreciation rate, as well as the average cost of homes, when September sales figures are released today.

        Preliminary numbers show that 1,828 existing, single-family homes were sold in Hamilton, Butler, Clermont and Warren counties last month, down from 1,931 in September a year ago. Existing single-family homes sold last month for an average of $156,000, compared with $160,000 in September 2000.

        One month's results don't make a trend, although the local statistics reflect what's happening nationally this year. Housing prices are moderating and are expected to rise just 6.9 percent in 2001 — down from 9.5 percent in 2000, according to the government's recently released house price index.

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