State No. 1 In Home Sales

Safety, affordable prices among reasons market is hottest in nation

The Charleston Gazette, August 17,2005

It may be that the rest of the country sees West Virginia as a sanctuary from terrorism, or simply that surging real estate prices nationwide have boosted demand for the more affordable property here. Whatever the reason, the state’s housing market has become the hottest in the country.

From the beginning of April to the end of June, sales of existing homes in the state grew faster than anywhere else in the United States, up 21.7 percent from a year earlier, according to the National Association of Realtors. The national average is 4.6 percent.  Most of the growth is coming in the Eastern Panhandle and Morgantown-Clarksburg area, spurred by the continued spillover of homeowners from the Washington metropolitan area and the steady economic expansion in north-central West Virginia.

“The Eastern Panhandle is a runaway market,” said Dea Kennen, vice president of the West Virginia Association of Realtors and co-owner of Kennen & Kennen GMAC Real Estate in Wheeling. “It’s experiencing incredible increases in real estate values.”

But other markets are thriving too, including the Northern Panhandle, the Snowshoe area and central West Virginia, she said.

One explanation, she said, is that lower interest rates have finally prompted many in West Virginia’s huge senior contingent to move out of their long-held family-size houses into smaller quarters. “You have a lot of the older population downsizing,” she said.

Meanwhile, West Virginia University Hospitals and the university itself, as well as the Morgantown-Clarksburg “high-tech corridor,” continue to draw newcomers to that area, said Darrell Rolston, president of the state Realtors. In general, such newcomers find cheaper prices than in other states. According to the Realtors, the median existing-home price has reached $208,500 nationwide, while in Charleston, the only West Virginia metropolitan area that the Realtors breaks out, the median is just $121,700.

But economic factors don’t tell the whole story, said Rolston, who is also head of Rolston & Co. in Charleston. Wealthier residents of the major metropolitan areas in the East appear to be choosing West Virginia for their second homes because it’s near many of the big population centers yet an unlikely target for terrorists, he said. “After 9/11, people in D.C., Baltimore and other large areas have realized that West Virginia is very close and figure terrorists are not going to attack,” Rolston said. “They want to buy a piece of West Virginia.”

The Realtors don’t yet track sales of second homes as a separate category, but the anecdotal evidence among agents suggests that these have loomed large in the recent growth.  Brisk business in Canaan Valley and at Snowshoe can easily be classified as second-home activity, as can developments in some Southern West Virginia counties.  Continued work on Corridor H — a series of highway connections across the south-central part of the state, from Elkins to Davis to Moorefield — should add to the allure for Washington-area buyers, since it will make for a quicker trip there, Rolston pointed out.

Developers in Greenbrier and Monroe counties, in particular, have been “going wild” selling two- to 10-acre lots, he said. “People just want to get out of the large cities.”

Second-home sales represent an especially big economic impact because in many cases the homes are luxury properties. One of the state’s most successful second-home developments, for instance, is The Greenbrier Sporting Club, which is adjacent to The Greenbrier resort in White Sulphur Springs.

Resort owner CSX Corp. has marked off 500 lots on about 4,500 acres, with each costing from $400,000 to more than $1 million, said Patti Spaniak, the Sporting Club’s marketing director. Since the lots started going on the block in 2000, 336 have been sold and 71 houses, with prices starting at $2 million, have been built. Another 42 houses are under construction, Spaniak said.

Buyers of the lots hail from 36 states, and none of them is using the property as a primary residence, she said.