By Jeff McKinney
The Cincinnati Enquirer
Paul and Tricia Montgomery sold their 100-year-old-home in Clifton in August for about $415,000, making a nifty $85,000 profit over what they paid for it four years ago.
Third-generation Clifton resident Ben Tallarigo walks his daughter Sophia, 6, to school along Resor Avenue. Proximity to schools is one factor that makes housing attractive.
(Ernest Coleman photo)
|FOUR CHART TOPPERS
Newport: Home values soar while it remakes itself
Mason: Big new homes and top schools
Maineville: It's affordable, on scenic river
Clifton: Both neighbors, houses diverse
|BY THE NUMBERS
Top 10 breakdowns of the 2003 sales figures
Five years of growth
How your neighborhood measures up
Cris and Linda Hamant sold their 1,600-square-foot Oakley home about 10 days after putting it up for sale.
Chad and Tracy Edwards bought a two-story home in Hebron, placing them among 682 consumers who bought homes last year in one of Northern Kentucky's hottest-selling communities.
Helped by mortgage rates that hit their lowest levels in four decades last summer, existing homes in the region's neighborhoods sold at record-setting levels and rose in value in most cases in 2003.
The average price of existing homes rose in 65 of 76 Greater Cincinnati and Northern Kentucky neighborhoods from 2002 to 2003, an Enquirer analysis of home sales data shows. The average price did even better compared to five years ago, climbing in 75 of 76 neighborhoods in the region from 1999 to 2003.
The average price of a home sold in 2003 in Southwest Ohio was $172,755, up 3 percent from 2002. In Northern Kentucky, that average price was $146,065, up 6.5 percent from the year before.
In contrast, the average price of a single-family home nationally was $216,200 in 2003, up 7.2 percent from $201,600 the previous year, according to the National Association of Realtors.
The 76 Greater Cincinnati and Northern Kentucky neighborhoods were included in the analysis because at least 100 single-family homes sold in them last year. Those neighborhoods accounted for about 90 percent of all home sales in the region. Average sale prices leaped more than 10 percent in 12 Tristate neighborhoods over the last year, topped by Newport at $124,457, with a strong 29.3 percent rise, and Clifton, whose average sale price of $189,216 was up 20.8 percent over 2002.
The gains in Newport and Clifton were nearly three times the rate at which U.S. home values rose.
Locally, the 28,060 homes sold in the region in 2003 was a record, according to area boards of Realtors.
"It was a record-breaking year for everybody. There was plenty of good inventory for homebuyers, and there were plenty of buyers looking," says Sandra Butler, president of the Cincinnati Area Board of Realtors. "The result was a super-hot market."
That group, plus the Northern Kentucky Association of Realtors, provided information for this story.
Buying a home - the largest single investment for most people - still offers consumers a chance to build wealth through appreciation and paying down their mortgages, Butler says.
"The housing market has been fairly stable, so from an investment viewpoint, it's less risky than other investments such as the stock market."
Michael and Marianne Brunner benefited from lower interest rates by buying an 1,800-square-foot home in Clifton, a larger house the couple likely could not have afforded without the falling rates. Homes on their new block on Warren Avenue sell for $300,000 to $400,000.
"We were able to get a mortgage in the 5 percent range, and that definitely made a difference on what we could afford to buy," Michael Brunner said.
The areas where average prices jumped the most last year - both over one year and over five years - were spread throughout the region. They included a diverse mix of housing - from $371,500 mansion-type homes in Symmes Township to $108,500 ranch houses in College Hill.
Homes on both sides of the river also rose in value the last five years. The biggest gainer in Ohio was Monfort Heights, which saw its average price swell to $169,565, up 33 percent since 1999. In Northern Kentucky and for the region, Newport was the sales price champ again, as the average price came in last year at $124,457, up 55.5 percent from five years ago. Some other findings on neighborhoods that have gained:
Florence and Mason each have top-rated school systems and led the region for the most homes sold in 2003, with 895 and 777, respectively.
Compared to five years ago, the Burlington, Hebron and North Boone County area saw the biggest gain in number of homes sold, 682, up 55.6 percent from 1999.
Homes fetched higher prices in Southwest Ohio than in Northern Kentucky. In fact, no Northern Kentucky neighborhoods made it into the top 10 list of the most expensive houses sold in a neighborhood. Symmes Township led that list with an average sale price of $371,555 for 2003. The most expensive Northern Kentucky area was Union, Richwood and South Boone County with an average sale price of $219,949.
Real estate experts and consumers say many factors can influence robust neighborhoods: a good mix of places for fun such as parks and recreation centers, quick access to work centers, shopping centers, schools and churches. Other magnets: proximity to major roads, airports and downtown Cincinnati as well as a housing stock that is both affordable and offers homes with character.
Some of those factors - including being near Rookwood Pavilion and Ault Park, plus having century-old homes with various architectural styles - helped the Hamants sell their three-bedroom house in Oakley for $225,000 only about 10 days after listing it.
Oakley, which boasts most of the amenities of a strong neighborhood, repeated in 2003 as the leader among Greater Cincinnati neighborhoods for fastest-selling homes with an average of 34 days. Only one other community - Finneytown - saw its homes sell about as fast, at 38 days.
"We thought it would take a month," he said. "We're obviously pleased that it sold so fast."
Not all of Greater Cincinnati's neighborhoods saw higher sale prices or sales gains. The average sale price dropped in 11 neighborhoods from 2002 to 2003. In Middletown, the average price has dropped by 2.1 percent since 1999.
From 2002 to 2003, home values fell the most in Ohio in Ross Township, by 7.4 percent. The Cold Spring, Crestview and rural Campbell County area saw the only drop in Northern Kentucky during that period, nearly 5.6 percent.
Local real estate experts caution it's not accurate to conclude that prices of individual homes in neighborhoods where the average sales price dropped also will fall. Different homes are put on the market each year. So if, for instance, a larger number of more expensive homes sells in one year but not the next, the neighborhood's overall average sale price will fall, but not necessarily the value of individual homes.
A good example is Madeira, which saw a 17 percent rise in average sale price for 2002, the highest of any community that year. But the sale of 35 homes in 2003 at $250,000 or above - four fewer at that price than in 2002 - caused Madeira to drop off the top 10 list for biggest gainers in sale price last year.
The growth centers
For some consumers, newer equals better. It often can equal more house for the price as well, say experts and consumers.
For instance, Butler and Warren counties are growing quickly in part because homebuyers can get bigger houses for their money and can find land to build new houses.
Both Mason and West Chester have posted at least five times more in sales over the last year than areas such as, for example, Montgomery and Blue Ash, which are older neighborhoods closer to the city center.
"You have more space and farm land to develop new housing subdivisions in Butler and Warren counties," said Jim Abele, manager of MLS of Greater Cincinnati, which tracks home sales in Southwest Ohio.
The new areas can provide better bargains for consumers. For instance, the 777 homes that sold in Mason last year fetched an average $278,363, up 5 percent from 2002 and the most homes sold in any neighborhood in Southwest Ohio.
In contrast, 132 homes sold in Montgomery for an average price of $318,394.
"In places where you have new development like Butler County, you may be able to find more affordable housing than in those areas with limited new housing development," Abele said.
Population growth is fueling the housing booms in Warren and Butler. The number of residents in Warren County rose to 181,743 as of July 2003, up almost 15 percent from April 2002, according to the Census Bureau. Butler County's population in July was 343,207, a gain of 3.2 percent in the same period.
The Burlington-Hebron-North Boone County area, which ranked seventh in the region for the most houses sold in 2003, is another example of a hot new area.
Tracy and Chad Edwards bought a home for $184,000 in Hebron largely because they are just a mile away from Interstate 275, and that offers them quick access to their jobs in downtown Cincinnati.
The couple also like that their new two-story traditional home has a two-car garage plus a nice-sized basement and that they live near family and friends, many of whom are moving to Boone County.
They bought the four-bedroom, partial-brick house after selling one in Elsmere for $120,000. "What we like about the house is that it gives you that country feeling with urban convenience," Tracy Edwards says.
Real estate experts expect the regional housing market to have a strong year, and home sales for Southwest Ohio and Northern Kentucky in March were up 27 percent over March 2003, though last year's numbers may have been low because of the start of the war with Iraq.
But Jim Russell, director of core equity strategies at Fifth Third Asset Management, is not as bullish as the Realtors, largely because mortgage rates have been rising recently and are expected to keep climbing as the economy heats up.
He says the pool of potential buyers may be smaller than a year ago, as many already have taken advantage of the lower rates.
"It's unlikely in 2004 that we'll see another record year in terms of transactions or home appreciation," Russell says.
He's watching mortgage rates and the job growth rate.
"The consumer has to feel confident about their job to make that large housing commitment," he says.
SPECIAL REPORT: SWEET INVESTMENT
Home sellers find prices up in short time
Both neighbors, houses diverse
It's affordable, on scenic river
Big new homes and top schools
Home values soar while Newport remakes itself
Look Who's Talking: Subodh Karnik, Air traffic ombudsman
Businesses just like Mom used to make
KFC not chicken about facing critics
Tristate Business Notes
Cindy B! agents specialize; the results speak volumes
Eckberg: Build winning team through delegating
Diebold finds voting machine venture stormy
T-shirt makers hope to boost sales among socially conscious
Google stock auction - revolution or disaster?