New Orleans Real Estate News

Feb. 24, 2023

New Orleans housing market cools after two years of frenzy; here's whats causing the changes

 

Roxana Campos stands in her dining room on Thursday, February 2, 2023 where most of her belongings are packed in boxes awaiting the moving truck that will take her and her husband to Florida. She has been trying to sell her Metairie home. (Photo by Chris Granger| The Times-Picayune| The New Orleans Advocate)

When Roxanna Campos and her husband put their 40-year-old Bucktown house on the market in January, they thought the three-bedroom brick Ranch would be a quick sell.

She had reason to be optimistic. As a local real estate agent, Campos had a front-row seat to the bidding wars and buying frenzy that pushed up home prices across the metro area by more than 25%, on average, since 2019.

But it’s been two weeks since her listing, and despite positive signals at the open house for agents and brokers, Campos hasn’t gotten a single offer.

“I would have thought we’d have multiple offers by now,” said Campos, who is selling because of an upcoming move to Florida. “If we haven’t had any movement in the next week, we might have to rethink things.”

Cooling off

Campos’ experience is not unique. Across the metro area, sellers, who spent the past two years in the catbird seat, are lowering their asking prices and making concessions to buyers as the white-hot housing market of 2020-2021 continues to cool.

According to the annual report from the Gulf South Real Estate Information Network, the volume of home sales in 2022 was down, inventory of available homes was up, and houses sat for longer on the market. 

True, home prices continued to rise. The median sale price across the metro area for a single-family home in average or better condition was up 7.8% last year over the year before to nearly $277,000, and up more than 24% over 2019’s pre- pandemic price of $219,400.

 

BY DAN SWENSON | GRAPHICS EDITOR

But if you factor in the nearly 7% inflation rate, those increases are not as impressive as they would have been a few years ago, when the rate of inflation was less than 2%. 

Experts attribute the slowdown, as they have for months, to the combined toll of three factors: higher interest rates — which nearly doubled to more than 7% by mid-2022, from less than 4% when the year began; inflation —which was also high in 2022; and huge premium increases in property and flood insurance rates.

As they look to 2023, they’re not optimistic things will change anytime soon.

“The insurance rates are literally killing deals,” said broker Jiarra Rayford of Rayford Realty. “I had a quote for a $10,000 premium for property insurance on a 2,800-square-foot house in Metairie. We couldn’t do the deal. The buyer had to walk away from their dream house.”

Mixed data

Overall, the numbers can seem confusing because while some indicators suggest a slowing market, home sale prices in 2022 continued to rise, just not as dramatically as the 9.3% jump they experienced between 2020 and 2021.

But the overall picture shows home prices are no longer trending steadily higher as they did through much of the pandemic.

On one hand, pending sales were down 13.5% in 2022 over 2021 and closed deals were down 12.6% during the same period. Outlying areas in Plaquemines, northern St. Tammany, Tangipahoa and the River parishes saw the most significant drops in activity.

Also signaling a cooling market, the total inventory of available homes was up 68% to 3,339 from 1,987. Outlying areas had more available inventory than most neighborhoods in the city or in the heart of Metairie.

Paradoxically, however, home prices continued to rise. Overall, every parish in the 10-parish region saw the median sale price of a home increase over the year before — in many cases, by double digits — except for St. Charles Parish, which was hit hard by Hurricane Ida in 2021 and saw its median home prices decline slightly.

The biggest increase in median sale prices came in Tangipahoa, up nearly 15% and St. Tammany, up more than 11%. Orleans and Jefferson parish prices saw more modest increases of 5.8% and 5.5%, respectively, which was below the rate of inflation. 

While the numbers varied from one part of the metro area to the next, real estate experts say in general, the price increases reFLect spikes from the first half of the year. As interest rate and insurance price hikes began to exert pressure on the market last summer, prices began to come down slightly or level out.

“We were still riding high in the first half of 2022,” said realtor Craig Mirambell, whose Mirambell Realty specializes in Metairie. “It really shifted mid year.”

Data indicates that modestly priced homes performed better throughout the year than pricier properties. Homes priced between $224,000-$350,000, sold more quickly than those in any other price range, spending just 32 days on average on the market.

Closing costs and creative deals 

Agents say they can fell the shift in the market by the concessions that sellers are now willing to make.

“Buyers are asking for more and sellers are willing to give a little more,” Rayford said. “I wrote a contract last week where the buyer asked for closing costs. Last year that was a no no.”

Sellers and their agents are also being creative about helping buyers shoulder the cost of higher interest rates. Broker Joyce Delery, who co-owns Engels and Völker New Orleans, said she has seen some sellers offer $10,000 to help “buy down” interest rates.

“We’re also seeing them be a little more realistic about their pricing," Delery said.

Delery and others expect that adjustments in the market will even out without causing significant disruptions. They’re more concerned about the effects of skyrocketing insurance premiums, which have more than doubled for some homeowners as dozens of carriers have stopped writing policies in the state.

Campos believes insurance issues are largely to blame for the lack of offers on her house. Her insurance premiums have more than tripled to $8,600 since she and her husband bought the house in 2014.

“Homes just two blocks on the other side of the (West Esplanade) canal are much less to insure, even though we’ve never flooded,” she said. “We don’t know what’s going on and the insurance companies won’t even talk to you.”

Agents and brokers expect those pressure points to continue slowing the market in 2023. That said, they’re still seeing the occasional crazy demand for mint-condition houses in desirable neighborhoods.

“It’s not like the market is dead,” Mirambell said. “I had nine offers last week on a house in Old Metairie. Another one in New Orleans had an escalation clause for $40,000 above list price. So, houses that are updated and have a lot of appeal are still flying off the shelf.” 

See full article : 
https://www.nola.com/news/business/new-orleans-housing-market-cools-after-two-years-of-frenzy/article_f83c67f0-a3f8-11ed-8dd1-4feaa3ccdeaf.html
Posted in In the News, News
Oct. 17, 2022

Realtors: Local housing market ‘strangest I’ve ever seen’

The current state of the New Orleans-area residential real estate market isn’t a typical one, according to local realtors, but it can still be viable for sellers.

 

The most recent numbers from the New Orleans Metropolitan Association of Realtors show new listings in August were up nearly 8% from August 2021, while closed sales were down 8.1%. Homes spent an average of 30 days on the market, compared to 29 last August. The average sales price rose 3.7% to $324,125. The data includes Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. John, St. James, St. Tammany, Tangipahoa and Washington parishes.

 

Craig Mirambell, NOMAR board secretary/treasurer and president/broker of Mirambell Realty, said the local market shows no signs of consistency, with some homes lasting 90 days and others in the same neighborhood selling quickly.

 

“It’s the strangest market I’ve ever seen in my 20 years of being a broker in real estate,” he said. “Typically, when the market turns south and goes bad, everything kind of turns bad; every house doesn’t sell and every house’s days on market rises.”

 

These days, it’s not necessarily a seller’s market. But a desirable home that’s updated, renovated and priced appropriately in a high-demand area is more likely to find a buyer, he said.

 

Kelli Walker Starrett, who was recently named the new CEO of NOMAR following the retirement of longtime leader Missy Whittington, agreed that the current market is “weird.”

 

“It’s not something we’ve usually seen when you have sort of the peak that we had, with as high as we were seeing sales prices for properties and multiple offers and multiple cash offers, and it was a very strange spot for us,” she said. “I think we naturally are hitting where things cool a little bit and they steady out.”

 

Nationwide, rising mortgage rates and declining home sales have signaled the end of a hot housing market. The New Orleans-Metairie area ranks No. 11 among markets that have cooled off the most, according to a new report from SmartAsset that looks at price reductions and decreased demand.

 

As of Tuesday, current rates in Louisiana stood at 6.95% for a 30-year fixed mortgage, and 6.24% for a 15-year fixed, according to Bankrate.

 

But the local market can still be friendly to sellers, Starrett said.

 

“There are still going to be people that want to buy a house,” she said. “There are going to be people that want to sell a house, and I encourage them to still do that. You don’t want somebody locked into something when they might need to make a change just because they feel like the market isn’t right for them. There’s always going to be a buyer out there.”

 

NOMAR numbers show that in Orleans Parish, there were 503 new listings in August, a 13% jump from 445 in August 2021. Closed sales were down 6.5%, and the average sales prices dropped 3.3% to $413,194. Days on the market dropped from 49 to 37.

 

There were 518 new listings in Jefferson Parish in August, up 5.3% from August 2021. Closed sales were up 2%, with the average sales price increasing to $300,142 – a 4.7% jump. Days on the market increased from 22 to 27.

 

St. Tammany Parish reported 431 new listings in August compared to 427 in August 2021. Closed sales were at 352, a 12.2% jump. The average sales prices also increased to $331,211, a 9.9% jump. Days on the market rose from 20 to 32.

 

To view all parishes in this month’s NOMAR “Local Market Update,” visit www.nomar.org.

See full article here.

Posted in In the News, News
Oct. 11, 2022

In New Orleans housing market, deals are still scarce but 'some of the frenzy has died down'

For the past six months, Dennis Zaffuto has been trying to buy a shotgun double or a duplex in Mid City with no luck.

It’s hard enough finding a desirable house in his price range of $400,000 to $450,000, he said. The few times he has, he’s been outbid.

“There is not a lot of property on the market that is viable and when they do come up, they sell within a matter of days,” said Zaffuto, who is currently renting. “I even offered all cash, full asking price recently and it got bought out from under me.”

In high-demand neighborhoods like Mid-City where Zaffuto is looking, real-estate agents say that the quick sales and high bids that have defined New Orleans real estate in recent years remain in place. The same thing can be said of even pricier homes in the luxury market.

But real estate experts are casting a wary eye at several factors — and a few pieces of recent data — that suggest changes ahead.

Rates are averaging about 6.3% for a 30-year mortgage compared to less than 3% in 2021, which can make monthly payments that were affordable a year ago less so now. Also, U.S. inflation has climbed above 8%, compared to slightly more than 5% a year ago, keeping a floor on prices and further reducing buying power.

Meanwhile, the number of home sales in the nine-parish New Orleans metro area is down 10% this year compared to same period a year ago, according to the Gulf South Real Estate Information Network.

And perhaps more telling, the number of homes on the market was up 14% in August compared to last year, increasing the months’ supply of inventory from about 2 months to nearly 3 months.

Taken together, it’s clear the market is no longer a “seller’s market,” according to residential brokers. But as Zaffuto and other buyers are finding, that doesn't mean fire sales.

There is still a lot of demand in some neighborhoods, particularly in Mid-City, Uptown, parts of the Bywater and Old Metairie, brokers say.

“It’s probably the strangest housing market I’ve seen in 20 years,” said Craig Mirambell, a broker who specializes in the Metairie area. “Some houses now are sitting for 30 to 60 days, and others fly off the market overnight with multiple offers. It’s house by house, block by block, and it doesn’t make a lot of sense.”

A 'neutral' market

While it may be hard to make sense of what is going on in one respect, the factors influencing the seemingly contradictory market forces are clear.

In addition to rising mortgage rates and surging inflation, there’s also a growing insurance crisis in the state. Eight insurers have gone under in the past year. As a result, the state’s insurer of last resort is expected to increase rates 63% beginning in January. Additionally, FEMA’s new risk-based rating system for flood insurance is expected to double what half the state’s residents pay for that protection.

To be sure, home prices — the primary marker of how frothy a market is — are still rising. The average sale price in the New Orleans metro area was up 8% this year to $343,257, compared to $317,791 last year, while the median sale price was up 9.4% to $279,000 compared to $255,000. But those increases were mostly on paper once inflation is factored in.

Meanwhile, the months’ supply of inventory has increased 33% to nearly 3 months from 2.1 months last year at this time. A supply of less than three months is generally considered a seller’s market, while a supply of six months or more is a buyer’s market.

“We’re moving toward the middle of those two extremes, which is a neutral market,” said David Favret, a realtor with Latter and Blum, who currently serves as president of the New Orleans Metropolitan Association of Realtors.

Inventory is not evenly spread around though, and affordable housing stock, which brokers say is currently considered anything below $350,000, is limited.

For first-time homebuyers trying to build equity with a home purchase, it’s a real problem.

“We have first-time buyers who have been looking for a year,” Mirambell said. “They wanted Metairie. Now, they’re looking in Slidell or Luling because it’s more affordable.”

Realistic pricing

The high-end segment of the market is still going strong as well. Luxury homes priced at $1 million or more are hot, according to realtor Chris Dorion of Berkshire Hathaway Preferred Realtors, who says those buyers are less likely to need a mortgage and aren’t as hard hit by insurance rate hikes, even though they feel them.

“The true luxury market is still really strong,” he said. “There is still really this cachet about New Orleans and there are a lot of buyers who can afford it.”

But even in the mid- and high-end segment of the market, brokers say they’re noticing that sellers are becoming more realistic about their asking price.

“Anything that is well priced, realistically priced, goes fast,” said realtor Bron Hebert with the Francher Perrin Group. “Some of the frenzy has died down. But anything well priced will sell.”

 

View the full article on Nola.com

Posted in In the News, News
Aug. 17, 2022

Welcome to the MBell Team, Lyndsay Paiz!

Mirambell Realty is excited to announce that Lyndsay Paiz has joined the MBell Family! We are so excited to see what is in store for you!

Posted in In the News, News
July 22, 2022

Higher home prices, rising expenses outpace annual wages

New Orleans realtor Delisha Boyd advises her clients they will be approved for home purchase prices approximately two and a half times their annual gross income.

The average price of a home in the New Orleans metro area is $354,880, according to a May report from the New Orleans Metropolitan Association of Realtors. Meanwhile the average wage in the metro area is $24.05 an hour, or $50,024 annually, according to the U.S. Bureau of Labor Statistics. A two-person income at those wages would only be able to mortgage a home for $240,000 – still $100,000 below the average sales price.

“You find a decent, move-in ready home below $250,000 in this market? Put your offer in site unseen,” said Boyd, realtor and owner of Delisha Boyd LLC. “Unfortunately, we have gotten to a price point where New Orleanians, particularly your first-time homebuyers and average wage earners such as your teachers or police officers, are being priced out of the New Orleans metro area and having to look at outlying areas to be able to afford a home.”

Slidell, Laplace, Prairieville, Gonzales and Madisonville have been several of the areas that Boyd has had to take clients looking for homes under $300,000. “But then you run into the problem of people driving 30-45 minutes to work and having to afford high gas prices,” Boyd said.

Craig Mirambell has a client who found a home in Luling for $250,000 and is driving 30 minutes to work.

“She tried to find a home in Metairie/Kenner, but it’s $300,000 minimum in our metro area to find a 2-3 bedroom, 1,600-square-foot house, and those either fly off the shelf or need updates and repairs that you need to be willing to do,” said Mirambell, realtor and owner of Mirambell Realty and NOMAR board secretary-treasurer.

Mirambell has another client whose principal and interest on a $300,000 home was $1,265 in December. Now, it’s $1,800.

Mortgage buyer Freddie Mac reported July 7 that the 30-year rate is 5.30%. One year ago, the average 30-year rate was 2.90%. The increase translates to a new homebuyer paying a mortgage note $240 higher each month than compared to last year.

“We enjoyed low interest rates and a high pace of buying activity for so long, but we have hit a wall, need to hit the reset button, so to speak,” Mirambell said. “There will be about a 3-6 month adjustment period for the market to restabilize. It will be interesting to see how home affordability improves and how the market reacts to all the varying factors. The best advice is keep having conversations with your realtor who has the best pulse on market availability.”

Homes unaffordable across the nation

New Orleans is mirroring a national trend of increasing home unaffordability amid high home prices, low inventory, rising mortgage rates and growing inflation.

National real estate data firm ATTOM has released its 2Q 2022 U.S. Home Affordability Report, showing that historic affordability has plummeted to a 15-year low as median home prices hit $349,000, with average wages sitting at $67,587. Nearly one-third of a person’s average wages is required for homeownership expenses. The percentage of average wages consumed by those expenses has risen at the fastest quarterly and annual pace since 2000.

ATTOM analyzed 575 counties nationwide, and 97% showed a home affordability lower than the historic average index of 100. ATTOM also analyzed 14 parishes in Louisiana, and all of them scored under the historic affordability index. Orleans Parish was the lowest at 62. Calcasieu was the highest at 93. Jefferson Parish scored an 81, while St. Tammany had a 72, the same as the current national affordability index.

Purchasing a home in St. Tammany, with all the expenses, requires 32.9% of the buyer’s annual income, the highest of any Louisiana parish. The average sales price in St. Tammany is $358,588, up 12% from last year (NOMAR May 2022). The median household income is $70,730 (U.S. Census).

“If you can spend about 20-25% of your income on mortgage, that’s generally where you need to be, so these current high expense numbers are definitely a good chunk of your money and pricing some people out of the market,” said Wayne Turner, realtor and broker/owner of Turner Real Estate Group. “Rates were raised so fast, and inflation happened so quickly that it’s a pinch on people and their buying decisions, especially first-time homebuyers.”

Turner said anything under $300,000 in St. Tammany is selling within three weeks; homes priced between $300,000 to $700,000 last about a month.

But when prices begin creeping toward $1 million, transactions may take longer, as much as three months. Low inventory factors into those stats. In 2019 before COVID, there were 1,850 homes available on the market in St. Tammany. Currently, there are 691, a 63% decrease.

“Our low supply has helped push up our prices,” Turner said. “One thing I’m hearing more of is, ‘If I sell, where I am going to go?’ But as in any market, you have to have a plan. You can’t wait for the market to come you, and you have to work with your realtor to adjust to the current climate.”

Posted in In the News, News
April 14, 2022

Welcome to the MBell Team, Amanda Tranchant!

Mirambell Realty is excited to announce that Amanda Tranchant has joined the MBell Family! We are thrilled to have her here in the office with us!

Posted in In the News, News
April 12, 2022

Mirambell Realty Welcomes Kimberly Schexnayder To The Team!

Mirambell Realty is excited to announce Kimberly Schexnayder has joined the MBell Family! We are excited for the experience you bring to our office and look forward to the growth as part of our team.

Posted in In the News, News
April 12, 2022

The MBell Realty team welcomes Stefanie Zeledon!

Mirambell Realty is excited to announce Stefanie Zeledon has joined the Mirambell Realty Family! We are are so excited to have her on our team and to see how she grows with us. 

Posted in In the News, News
March 30, 2022

Craig Mirambell Jr. speaks on FEMA's Risk 2.0

Risk Map 2.0, FEMA’s new attempt to solve the national flood insurance problem in the United States, hasn’t started off on the right foot for many on the Guif Coast of Louisiana and Mississippi. Many homeowners are finding out their flood insurance rates are going to be rising and it’s not just nickels and dimes. Some renewals in Metro New Orleans are going from $700/a year premiums to $11,000.  FEMA has capped the amount a premium can increase to 18% a year, but with compounding increases these premiums could put some homeowners under water and unable to pay such exorbitant costs.

 

Craig Mirambell Jr., CEO of Mirambell Realty, says, “The problem I see is that many homeowners aren’t even aware of what’s to come because the increases won’t happen until their renewals hit starting in April. Many homes without policies that are being sold now are facing the immediate increase as there is no incremental increase if the property did not carry flood insurance previously.”.  The rate hikes will surely affect many Metro New Orleanians as the new Risk Map 2.0 heavily relies on data such as proximity to bodies of water but doesn't take into account as largely if your home is built inside the flood protection of the levees.  “A lot of the characteristics we are used to with flood insurance are no longer as big of factors in reducing premiums. For example, flood zones, height above base flood elevation, and if your home has ever flooded previously are no longer what FEMA considers a priority in their new pricing determination.”, Craig added. 

 

Another reason many homeowners aren’t aware of these potential increases is possibly an inattention to the new Risk Map 2.0. This could be attested to New Orleanians still recovering from Hurricane Ida. There are still blue roofs around the city and many are still in debate with their homeowners carriers. Flood Insurance just sent at the top of the minds right now for those renovating still.”  We can’t forget that homeowners insurance prices are going through the roof on the heels of Ida and its aftermath. Many are seeing their carriers leave the state or are being faced with hurricane deductibles up to 5%, reminiscent of post-Katrina. The one-two-punch of both rising premiums will not be warmly welcomed, but just like hurricanes, we seem to resiliently get through them each time.

 

Read more HERE 

Posted in In the News, News
March 28, 2022

'The possibilities are endless' Craig Mirambell Jr. discusses the power of ROAM MLS

Mirambell Realty is excited to announce that Craig Mirambell Jr., CEO, will continue in the role of President of  ROAM  MLS for 2022.  The ROAM Board of Managers is made up of a group of Realtors with great vision and persistency and all should be applauded for the  collaborative effort shown by the Board and their local staff. Craig says, “The power within ROAM was proven on day one when single family data went live in the MLS for the first time amongst the 4 associations together. Many Realtors were appreciative that they could now practice Real Estate in these areas where they have been licensed from the beginning. Before ROAM, Louisiana Realtors did not have MLS access in other regions without paying additional dues, our Board has merged that gap and is looking to grow with other associations coming on board soon.” 

 

 ROAM is Louisiana’s Realtors largest and most powerful MLS in the state. Currently, ROAM consists of 4 state associations; the New Orleans Metropolitan Board of Realtors/GSREIN, the Baton Rouge Association of Realtors, Central Board of Realtors, and Bayou Board of Realtors. These 4 associations account for 12,000 of the 15,000 Realtors in the state.

 

What does this means for Louisiana Realtors? A Realtor who subscribes to one of the participating partner associations will have access to all current listings and historical data in these regions of the state. A cooperation for commission is included as well as unified rules and more products offered to help the Realtor provide better services to their customers. Realtors using ROAM will also benefit from a single point of entry to enter new listings into the system. 

 

Craig stated, “The possibilities are endless with ROAM, we aspire to have other Boards in the state join ROAM as well as other states in the Gulf Coast. In the future, we hope to see a commercial side of ROAM for all of our Commercial practitioners. We will always provide great customer service and add products to keep our Realtors leading the state.”

 

See more about ROAM MLS here.

Posted in In the News, News