Housing slump hits home

By Kevin Wilson: Freedom New Mexico

Robert Garcia loves the home he and his wife share in Clovis, a three-bedroom, two-bath brick house he considers average.

The Garcias are planning to move for a possible promotion with Robert’s computer job, and he’s shared a problem with average Americans in trying to sell his house. A slump in the housing market has homeowners such as Garcia unable to close a deal.

“We’ve had a lot of lookers, but no buyers,” said Garcia, who tried self-selling for the first few months, then got a Realtor a month ago.

His situation isn’t unique, for reasons felt nationwide and reasons more closely aligned with Clovis.

A recent Federal Reserve survey of banks showed that lenders are making it harder to get a home loan, even for borrowers with good credit. About 40 percent of respondents said they had tightened lending standards on prime mortgages during October, up from just 15 percent in July.

Art Garcia, the state housing program director for USDA Rural Development, said his department has a program to provide low-cost loans for first-time home buyers who may not otherwise qualify.

“It’s a bit tougher for people to qualify for a mortgage. Mortgage bankers have kind of pulled back a bit,” Garcia said. “That’s why
programs like ours have seen success, because we can provide a mortgage that’s not an adjustable rate or interest-only.”

Those programs look good, Garcia said, until rates spike or the interest payments end and the buyer still owes the original loan amount.

A reason for housing problems specific to Clovis is the transition period for Cannon Air Force Base. The base is phasing in a special operations mission, and local Realtors figure, to take an Air Force term, the market will be in a holding pattern for a few months before it strengthens.

Gayla Brumfield, a Clovis Realtor, said between Curry and Roosevelt counties, there are about 420 listed homes, 37 of them new.

The number of available homes was much lower before Cannon was targeted for shuttering during the 2005 Base Realignment and Closure process.

“Up until the BRAC hit, the lowest I remember for Clovis and Portales was around 200,” Brumfield said. “After BRAC hit, it kind of put the brakes on everything.”

Clovis hasn’t seen the same mortgage problems other areas have, Brumfield said, and she figures Federal Reserve rate cuts will help along with the base transition and incoming businesses like ethanol and bio-diesel plants.

“Long term, it’s going to be very good potential growth,” Brumfield said.

One problem incoming military personnel may have, Brumfield said, is their attempts to sell their previous homes. Brumfield compared Clovis homes to Florida and found many financial advantages.

For a $220,000 home, she said, the average home insurance policy is $4,000 annually in Florida and $850 in Clovis. Property taxes are also higher in Florida, but the state has no income tax and better bankruptcy protection for homeowners.

The housing market in eastern New Mexico may not be favorable, but Garcia still keeps optimism four months into his selling efforts.

“I’m 99 percent sure we’ll sell it this month,” he said.

At a glance:

Homes listed for sale with real estate agents in eastern New Mexico

Roosevelt County
• Two new homes, average $127,000
• 73 existing homes, average $134,500

Curry County
• 35 new homes; average selling price of $202,000
• 311 existing homes, average $159,600

Source: Colonial Real Estate, Clovis