The housing market remains tight in Southeast Alaska – everywhere, in fact – but that doesn’t mean it’s impossible for buyers to find homes.
Patience and preparation are two of the most important considerations as buyers enter the market, say a realtor and banker who work everyday to connect people with new homes.
The pair took questions in the final installment of the Sitka Chamber of Commerce’s Fall Speaker Series on Housing (on Wednesday, 12-6-23).
High interest rates recently have forced home buyers to set their sights lower when looking for property to buy, but high demand has kept prices up – especially in Sitka.
Skyleen Bottani, a mortgage lender at First Bank, says borrowers should not despair. There is a way to get there.
“I think they should first come see me and see what they can afford,” said Bottani. “And if it’s ‘not yet’ we’ll set them up for a roadmap to success. So if it’s not today, maybe six months, maybe a year, but we can set them up to to see what they are and what their options are. So there’s hope.’
Bottani was joined by realtor Keith Brady, who offered a reality check on Sitka’s market, which is not all that different from the markets in Juneau or Ketchikan. Buyers are not likely to catch a break, even if all the numbers suggest that prices should be coming down.
“And unfortunately in Sitka, just because of the lack of real estate, it seems to always be more or less a seller’s market here, regardless,” he said.
Brady agreed that the first stop for any buyer should be the lender, because there are a number of mortgage programs that could affect both someone’s eligibility for a loan, and the amount they’re pre-approved to borrow.
A pre-approval letter from the bank can make the difference when the right property comes on the market.
“Some people are ready to go and they’re ready to buy,” said Brady. “And it doesn’t take that long. They know what they want. And so if there’s a home on the market that fits all their criteria, they like it, it doesn’t take that long. But it’s hard to say – I mean, it could be like a week to a couple of months.”
Bottani and Brady described a dynamic market: Interest rates were changing daily, sometimes on the quarter-hour, and prices were leveling out. Some properties were sitting longer on the market – now considered overpriced by many local buyers.
Bottani put to rest the idea that Sitka was being bought up by out-of-town owners looking for second- or third homes. Some of that is happening – as is workforce housing purchased by businesses – but it’s not a leading trend.
“I’m seeing (buyers from) all over the market. I mean, a lot of first-time home buyers, and I see a lot of longtime residents, and a lot of new (buyers coming in) for the hospital here locally. And they range from income limited programs and stretch out to higher income – but I see it all over the board.
Brady, Sitka’s former municipal administrator, said there were inherent challenges to opening more land for development, especially in extending Sitka’s utilities. He thought a trailer park for families who owned their trailers could work, and be a first step toward owning conventional real estate.
Bottani saw opportunity in higher density housing.
“Personally my first home was a townhome,” she said. “It cut the cost of monthly buying in the Ketchikan market, which was super high. And my budget was small being a first-time home buyer, but it worked out. Ideally, zero lot lines, having that space to call your home, and to build equity. I don’t know if (a developer) would be willing to do that. But again, it comes down to land.
And the land is just not there, Brady added, even for private developers hoping to capitalize on the tight market.
“I have one person who’s looking for two- to four acres,” he said. “And that’s a lot of land here in Sitka, but they want to build 20 to 40 unit apartments here. And I can’t find it.”
The solution for this buyer is the same as that for the borrower who’s qualified for $350,000 in a market where home sales are averaging considerably higher: “They might just have to wait,” said Brady.
