Brothers jake, left, and John Neufeld work on a house under construction Monday at 3909 Springwood in Clovis. CNJ staff photo: Eric Kluth
By David Irvin: CNJ staff writer
The housing market in Clovis is so tight that homes are selling nearly as fast as they are being built.
In response, local real estate companies and builders are drifting into housing development.
In recent years, Clovis averaged between 400 and 500 homes on the market at any one time, said Gayla Brumfield, president of Colonial Real Estate. Right now there are only 171 active listings and virtually no rental properties available, she said.
“If you want something in a particular price range, in a particular area, you are going to have trouble,” said Brumfield, who is also the president of the Realtors Association of New Mexico.
Brumfield has partnered with builders and general contractors to develop seven acres of land near the north part of Colonial Park, and has already sold about half of the subdivision, she said.
Brumfield speculated that the housing boom in Clovis is tied to the appearance here of national retailers like Wal-Mart and Lowe’s, the continued success of Cannon Air Force Base, railroad expansion and the promise of a cheese plant.
Another Realtor, Max Watt of Re-Max, said the rental market in Clovis is so poor it continues to fuel the buying market.
“I’ve never seen it like this before, never,” said the Clovis resident, who has been selling houses in Clovis for 26 years.
Watt saw an opportunity in the $110,000 to $140,000 new home market. She said no one was building homes in that price range, so she purchased 18 lots and began building homes soon afterward. Construction on the first home began about 3 months ago, is nearly done and will be closing in a couple of weeks, she said.
She said the houses are selling before they are even done.
This bounce in real estate spending in Clovis parallels a boom nationwide. The U.S. Department of Commerce recently released figures showing money spent on construction in July reached $997.2 billion nationwide, an increase of .4 percent over June and an all-time high for construction spending. About $537.4 billion of that was spent on private residential construction, the release showed. This constitutes a 14 percent jump in residential construction over July 2003.
Houses listed and sold between January and August of 2003 in the Clovis market went up from 380 units to 462 units in the same period of 2004, a 22 percent jump. Over the three-year period the average house price increased incrementally each year.
Over the past three years, the number of houses sold in the Clovis market and the average price of those homes increased steadily.
“It’s a little tough for the first-time home owner,” Brumfield said. “If the interest rates go up, there will be some crunch.”
She said that the growth seen in Clovis over the last three years is also being seen around the state. She thinks this building boom will increase at his pace for at least the next two years.
To respond to market demands, some of the local builders are starting to build smaller houses, Brumfield said. This has brought the average price of new housing down from $200,000 in 2003 to $193,000 this year.
Some builders are also starting to look for the niche markets where they can sell new homes.
“For the last five years we’ve been busy pretty much all the time,” said John Bourne, president of John Bourne Custom Homes. “We have eight houses going up right now, all but one of them are custom. I have four more on the drawing board, and our lowest priced house is $250,000.”
Bourne said inflated prices mean that the sellers and builders are doing very well, while the buyers may be suffering somewhat, he said.
“There’s been a lot of inflation around here in the last 4 or 5 years,” he said. “We built a house 6 years ago for under $200,000, and they sold it the other day for $349,000.”