Wichita's housing market seemed grim in December. But it wasn't as bad as it was in November.
"Our home sales started falling at the end of 2007," says Stan Longhofer, director of the Center for Real Estate at Wichita State University. "Then they dropped off pretty substantially in 2008. And in November, sales dropped through the floor."
As bad as it was last year, the housing market in Kansas never experienced a bubble that burst. Instead, it has had a fairly stable market.
"We have not had excessive building," says Lonny McCurdy, president of the Wichita Area Association of Realtors.
The city also hasn't had runaway price inflation, and it hasn't had a surge in real estate speculation, he says.
Even though home sales in Wichita have dipped, home prices have been consistent. "In our market, our values are still pretty solid," says Fred Samuelson, president of the South Central Kansas MLS. "So we don't really have an overextended market to correct."
Then what sparked the sales downturn?
It started when mortgage applications became stricter, and home buyers couldn't count on zero-money-down loans. They have had to come up with a 3% to 5% down payment, holding back many first-time home buyers.
And the national economic meltdown has caused much anxiety. "Both buyers and sellers are staying home," Longhofer says. "They are so afraid, based on everything they hear, especially the national news."
Many sellers are assuming that it will take a long time to make a deal, he says. But a house can sell in a week, leaving sellers scrambling to find a new home. Sometimes, they're finding there is not much available on the market.
Wichita's local economy has been in better shape than the nation's.
The city's top employers are Cessna Aircraft, Spirit AeroSystems and Raytheon Aircraft, according to the Wichita Chamber of Commerce.
There have been some recent layoffs, though.
"Of course, business jets are now the poster child for greedy corporate excess," Longhofer says. "Somebody makes those jets, and a lot of workers are here in Wichita."
If the layoffs are temporary, they may not have a big impact on home sales. Wichita doesn't have any plant closings, which can significantly hurt a housing market, Longhofer says.
"Wichita has absorbed layoffs before," Samuelson says. "And we feel confident that our market can pick back up."