The long, snowy winter took a toll on the Quad-City housing market. But leaders of two major real estate firms said as the weather is warming up, so is the local market.
Caroline Ruhl, CEO and co-owner of Ruhl & Ruhl Realtors, said the company's home sales were down around 5% in the first quarter from the same period last year.
"That's pretty simply explained by the record cold and snow we had," Ruhl said. "But in April, it's just exploded. It's just crazy. The demand that we didn't see in the first quarter is out in full force. It's more active than last year. At least in our company, it's up over last year."
On the Iowa side of the Quad-Cities, she said the number of units sold in the first quarter was up 2%, while units sold on the Illinois side was down 18%.
Lynsey Engels, president of Real Estate Brokerage with Mel Foster Co., said her company also is seeing a market rebound this month.
"The market is really hot, and there are a couple of factors for that," she said. "I think there was pent up demand from the January and February stretch. I also think it's the fact that interest rates have gone down again. So it's a combination of those things causing this market boom right now."
To Ruhl's surprise, she's seeing lower mortgage rates this month compared to last year.
"For people who missed out on refinancing the last time around, they have a second chance," Ruhl said. "You can get a 15-year loan at 3.5%. Rates are really good, which I didn't personally expect."
It's a seller's market in the Quad-Cities this spring, both company leaders said, with not enough inventory to keep up with demand.
"It's because there are so many investors out there who have discovered what a great rental market we have. Around 20% of our inventory has been sold to investors and converted to rental homes," Ruhl said. "The other factor is baby boomers are choosing to age in place instead of selling their homes and downsizing to a condo or lesser property."
Both Ruhl and Engels said the Quad-Cities has the greatest need for more affordable housing on the market. But, Ruhl said construction costs slightly rising is hurting the development of new affordable units.
Engels said Mel Foster is continuing to see new construction sales despite material costs rising.
"The inventory shortage is actually making the market strong. We usually don't see properties with this many offers," Engels said. "We're also seeing a big uptick in our new construction lots and residential subdivisions. We've seen a significant jump in new construction lot sales, and some of the houses haven't even been dug yet. The amount of offers we're getting says a lot."
With the low unemployment rate and stronger economy, Ruhl said she expects the housing market to continue improving, driven by "buyer confidence and demand."