WATERLOO — Home, at least the sales thereof, is where the heat is, according to real estate dealers in the area.Single-family detached home sales in Waterloo increased by 80 units in 2017, for a total of 953 — 9.06 percent higher than a year earlier, according to Dick Robert, a broker with Cedar Falls Real Estate Co. In Cedar Falls, the increase was “larger than expected,” Robert said, going up by 59, for a total of 561 in 2017. That was an 11.75 percent increase.
The average sale price in Waterloo fell 4.8 percent, from $121,269 to $115,445, Robert said, although, the Northeast Iowa Regional Board of Realtors had the figure at $114,000. In Cedar Falls, Robert said, the average sales price increased only .05 percent, from $217,393 in 2016 to $219,263. The Board of Realtors tabbed the average price there at $219,499.
It has been a hot market for some time, with average prices in Waterloo having increased by 212 percent since 1980 and 356 percent in Cedar Falls, said Mary Shileny, Board of Realtors’ executive director.
“Cedar Falls has been on a wild ride in a seller’s market for most of 2017,” Shileny said. “Waterloo started off the year with a surplus of homes — a buyer’s market — and took a couple of drops and hikes to end the second half of the year at a steady market for sellers and buyers.”
Shileny said the trend should hold through 2018.
“The experts predict that the housing market will remain very strong, driven by the increase in households and household incomes,” she said. “The market restriction that may affect the 2018 market is low inventory. Overall, you can expect a small increase in number of sales and home prices.”
Steve Knapp, managing broker with Cedar Falls-based Lockard Cos., said he projects “a good, strong” 2018 for housing sales in the area.
“I expect to do 5 to 6 percent (increase in sales) are my internal projections for residential,” he said. “We’ve obviously got a good strong local economy. I think a lot of people are looking at potential interest rate increase through ‘18 for at least a small amount, but they know it’s a good time to buy. I think people anticipating buying in the next couple of years have an incentive to buy more quickly and lock in that low interest rate.”
Robert offered a different view.
“For 2018, I am going to forecast a decrease in sales in Waterloo of 5 percent and, in Cedar Falls, a decrease of 8 percent,” Robert said.
He noted the average sale price in Waterloo likely will increase 2 to 4 percent, while, in Cedar Falls, the number will shrink by 3 percent, “primarily due to rising interest rates.”
As long as interest rates remain low, sales will stay high, said Kara Bartels, an agent with Re/Max Alliance in Denver.
“The interest rates are still at an all-time low; prices are up and were up last year,” she said. “It’s still a seller’s market. ... We expect it to be good, the same as last year. The last two years have been good.”
Housing starts are flourishing, Bartels said.
“I live in Denver and, in the last year, there’s been a huge influx of people building again,” she said. “It’s expensive to build, but we’re seeing it.”
Activity is brisk across the Cedar Valley for Skogman Homes, said Kevin Fittro, vice president of Skogman Homes in Cedar Falls.
“Four to five starts a month is an average; we’re looking at Evansdale, Elk Run, Grundy, over at Denver a bit,” he said.
Waterloo and Cedar Falls continue to be “strong” for housing starts, Fittro said.
“Cedar Falls permits were right on par with what they were last year,” he said, noting that Waterloo had fewer, “but that wasn’t a weakness; they were only five to six single-family permits off.”
Skogman has more developed lots in the Cedar Valley than ever, Fittro said.
“Typically, we hold about 60; we’re double that,” he said. “Now, between Waterloo and Cedar Falls only, we have 130 buildable lots. So, our vision is that the Cedar Valley is going to be as strong as it has always been, a great place to live and work, the epitome of community. It really is where people want to call home and we’re happy to be a part of it.”
Things look promising for outlying communities, too, Fittro said, pointing to building activity in Denver, Hudson and Grundy Center.
“I think that’s the positive — when you have calls from all these surrounding communities, that’s just one more way you’re confident that growth can happen,” he said.
Downtown neighborhoods in Waterloo and Cedar Falls are becoming residential magnets, brokers say.
Bartels noted that the Grand Crossing Condominiums, adjacent to the TechWorks campus, serve as an apt sign of growth in the downtown housing market.
“It’s been good,” she said of the growth in housing opportunities in or near downtown Waterloo.
Waterloo-based developer Vern Nelson of Nelson Properties says people are seeing value to downtown living and responding.
“In my view, anyway, it’s looking pretty good,” he said. “We just signed up two more clients in our apartments in the Black’s building. One came from Mississippi and the other from out of town, too.”
Lofts are selling briskly, Nelson said.
“I had one come in yesterday afternoon,” he said. “They had a house that they’re selling and are moving into an apartment. That’s looking pretty good.”
Walkability and access to services are chief assets to downtown living, Nelson said.
“More and more people moving in,” he said.
Knapp agreed, noting that downtown Cedar Falls is seeing a similar growth pattern.
“With all the other growth in the downtown Cedar Falls area, if we can price some new products, we’ll move product down there because of the convenience of services nearby,” he said. “But I think with these younger people, they’re more driven to convenience and lifestyle. That’s a market in our area that’s on the ascendancy.”
Affordable housing is on the rise, too, said former Waterloo Mayor John Rooff, whose Rooff Development LLC has built 115-20 affordable homes in the last 10 years, he said.
“There was always a need for housing for people who need affordable housing,” he said. “What we found was Waterloo needed it and East Side needed it more than any other part of the city.”
Rooff’s company built six brownstone units behind Queen of Peace Catholic Church near downtown Waterloo.
More units are either going up near downtown or are in planning phases now, so the housing stock is headed upward, Rooff noted.
“You need to find the people early so you can work with them,” he said. “It’s moving from a rental to a new home. What kind of incentives are there? It’s a little more protracted than just listing brand new housing on south side of Waterloo or Cedar Falls. it’s a different type of market; it seems to work.”