VOL. 123 | NO. 1 | Wednesday, January 2, 2008
Decline in Residential Sales Not Dampening DeSoto’s Momentum
By Eric Smith
DeSoto County is by no means insulated from the nationwide housing crisis, but the booming community south of Memphis is weathering the storm as well as - if not better than - any place in the Mid-South.
Bolstered by the fastest-growing population in the region and Mississippi and one of the fastest-growing in the nation, DeSoto's residential real estate market has proven to be somewhat steady while others slide.
Yes, sales are down from the record pace of 2006 and 2007. Yes, the county continues to suffer its fair share of foreclosures resulting from the subprime fallout plaguing scores of borrowers.
And, yes, DeSoto has what many would consider a glut of new subdivisions that make it harder for existing homes to sell.
But the county is still drawing plenty of new residents from metropolitan Memphis as well as from elsewhere in the region, meaning the outlook for 2008 appears to be bright, said C.F. Moore, managing broker for Crye-Leike Realtors' Southaven office.
"Have we experienced a slowdown? Yes," Moore said. "But not as dramatically as the rest of the country. Our market in DeSoto County remains healthy, just not as healthy as the previous two or three years."
Sunshine and blue skies
Allison Spencer is a director at the Northwest Mississippi Association of Realtors (NWMAR) and an affiliate broker and co-owner at Signature Realty LLC.
Spencer recalled reading a magazine article recently that compared real estate to the weather - and she thought the analogy was apropos to what's been happening industry-wide in 2007.
"All across the nation, the weather's not the same and housing sales are always regional," she said. "That hits the nail right on the head."
In other words, just because it's raining in Seattle doesn't mean it's raining in Southaven, and the numbers back that up.
Like Memphis, DeSoto County should wind up with its third- or fourth-best year in history for residential sales. Through mid-December, the county had registered 3,791 home sales, according to NWMAR.
That puts 2007 slightly behind 2004 (3,930 homes sold), with a few more closings for the year expected to hit DeSoto's Multiple Listing Service during the first few weeks of January.
The years of 2005 and 2006 have been the county's best for sales with 4,767 and 4,759 homes sold, respectively.
While that puts 2007 at about a 20 percent decline from the previous year, home values have increased. The average sales price in DeSoto reached an all-time high in 2007 at $167,592, up from the average sales price of $165,460 in 2006.
Helping DeSoto County's cause is its population, which ballooned to 144,706, according to an estimate taken by the U.S. Census Bureau, Population Estimates Program, as of July 1, 2006. That was up 35 percent from 107,199 residents in 2000. That number could rise even more when the new census is taken in 2010.
"We look for the population to increase substantially," Moore said. "We don't look for a slowdown."
New homes, good schools and proximity to Memphis' commercial centers have indeed been a boon for the county's growing numbers.
Some of DeSoto's communities, for example, are closer to Memphis International Airport and its surrounding distribution industry than parts of Shelby County.
Spencer has sold homes to people who work in Memphis, Tunica and elsewhere in the region because they wanted a central location.
"This is such a good middle ground for everybody," she said. "You can live here and literally work in any of the three states around us."
And the school system continues to lure families to the area: "They just want to be in the DeSoto County School District," Spencer said. "That's been a huge pull."
Those factors all will be enhanced by the completion of Interstates 69 and 269. I-69 is the highway that will join Canada and Mexico, and one of its sections, I-269, will loop around the Memphis metropolitan area through DeSoto County.
Part of I-269 is already complete, and Moore said he believes the retail development along that corridor is going to further aid DeSoto's residential growth.
"The leg of I-69 that is completed in DeSoto County has spawned a great deal of interest in commercial land along that corridor. I think that and the Riverbend project are both positively affecting DeSoto County."
Floodgates wide open
What does 2008 hold for DeSoto's residential real estate market? Realtors remain bullish on the entire county rebounding thanks to desirability, good pricing and a healthy inventory.
"People keep coming, and we keep building and we keep reselling real estate," Moore said. "Our listings are up substantially, so I think we've got enough product to accommodate the continued movement of folks."
Vicky Reel of Reel & Associates and outgoing NWMAR president expects the entire county to withstand the recent housing slump and for things to return to normalcy some time in the next year.
"We had a phenomenal five to seven years in this business, particularly in our area," she said. "I think what we're going to see for 2008 - and what we have seen in the last half of 2007 - is just typical real estate."