Butler County’s housing market has turned a corner, but a full recovery of home values is still years away, housing experts agree.

A home is the single biggest investment most people make, so the value of their home is an important source of wealth. Experts believe an improving housing market can help create jobs and stimulate spending to benefit the rest of the economy.

And the market is improving. The number of area homes sold so far this year is the highest since 2008 and home prices have been on the rise since 2010.

But the national and local housing market fell into a deep hole when the housing market crashed in 2008. At this point, average sales prices for Butler County are down 20.6 percent from a peak price reached in 2006.

The average sales price over the first three quarters of this year is $138,464. The Butler County market’s average sales price peaked in June 2006 at $174,384, which are included in the sales prices now, according to the Multiple Listing Service of Greater Cincinnati.

“It’s going to be a slow recovery, but certainly the recovery’s there,” said Shaun Bond, director of University of Cincinnati’s Real Estate Center. But it has been “six years of continual downward house pricing movement. That’s just going to take a long time to unwind. I think it’s going to take us many, many years, if not a decade or more.”

The housing market in Butler County is considered to have reached a point of stabilization, according to county Auditor Roger Reynolds.

There were 838 valid homes sales of single family residential units in Butler County in the third quarter, showing an upward trend in single family residential transfers since last year, he said.

“We are hopeful to see the trend turn for the better in the near future,” Reynolds said.

Property tax appraisals

Every six years, the auditor’s office does a complete revalue of properties, where it physically goes out to examine every parcel in the county, Reynolds said.

“In the mid-term, the triennial year, the auditor’s office also conducts an update, but it’s typically conducted from the office.

“We’ll go out and look at certain areas, but we won’t do a physical review of every parcel in the county,” Reynolds said.

The county is now in the middle of its full-fledged complete revalue, which will take anywhere from 18 to 24 months to conduct.

“It’s a major undertaking,” he said. “The first part of it is data collection, so we’re looking for any changes to properties and looking to ensure the data we have in our system is accurate from a standpoint of square footage, number of bathrooms, the style of the home.”

Then the auditor’s office does model marketing, where it uses software to examine sales information from the past 36 months. That includes market data, which provides the auditor’s office with trends, so that it can perform an analysis and start looking for areas that may stand out where it needs to go perform additional analysis.

The third stage involves physically reviewing every parcel with the preliminary data to make a final determination.

“We do that by going out into the field and reviewing the home, business or farm,” Reynolds said. “We never go inside a home.

“We’re talking to folks and asking them if property information matches our property card.”

What’s different this time around is that the auditor’s office is using more technology than ever to complete its task and determine if something has been added to or subtracted from a property, he said.

“In our lead up to going out into the field, we’re using aerial photography to review properties more than putting more people on the road,” he said. “The market modeling data is much better now.”

The net result of using more technology and doing more in-house revaluing of property is a cost-saving boon.

“In past years, we’ve paid an outside firm more than $2.5 million to conduct this re-evaluation for us,” Reynolds said. “This time, we’re doing significantly more of it ourselves and our contract with the outside firm is only $500,000, resulting in significant savings.”

The new values will be for the 2014 tax year.

“Our goal is to have values communicated to property owners by mid-2014,” Reynolds said.

Realtors don’t use auditor’s office number when valuing a property, because they can be inaccurate, according to Gwen Ritchie, a Realtor with Huff Realty and the president of Hamilton-Fairfield-Oxford Board of Realtors.

“Those are based on a 6-year evaluation change all the time and that may or may not be a spot-on market price,” Ritchie said.

To create a fair market analysis using comparable sales, real estate agents will refer to sales within the past six months in a 1-mile radius, according to Reva Owens, a Realtor at Coldwell Banker Oyer and the president of the Middletown Area Board of Realtors.

“We try to compare ranches to ranches, three-bedrooms to three-bedrooms and stuff like that,” Owens said. “If there was a house in there that was a foreclosure that will bring the average down but we try to look at that, but unfortunately it will affect the price.”

Realtors also will take into account the competitive pressures on the market at the time, Ritchie said.

“Sometimes you say this is what it’s probably going to sell for, but depending on what’s going on competitively that can also impact what it’s going to sell for,” Ritchie said. “If you’ve got 20 duplicate listings on the market at the same time, you’re not going to necessarily get the same price unless you’re the best of the bunch.”

Condition of the property also factors into the valuing equation.

An auditor’s office only values a home based upon what can be seen driving down the road, Ritchie said. “Theirs can be completely off,” she said. “They’ve never seen the inside of the house and they don’t know the condition.”

Move-in ready moves a property

Bradley and Ashley Lambert looked for a home once a week and looked online on a daily basis for two months before finding a 850-square-foot 1-story at 2007 Spencer Lane.

The Butler County Auditor’s Office appraised it for $68,720 in 2011, down from $72,260 before that.

Houses in the neighborhood usually sell from anywhere from $45,000 to $70,000, with many bank-owned properties having sold for $20,000 to 30,000, according to Owens, who helped the Lamberts find their house.

The previous buyer who made improvements to the interior of the house initially purchased the Middletown foreclosure for $30,000 in 2010 and put it on the market for $62,900.

The Lamberts purchased the home for $60,500.

“I thought that was fair,” Bradley Lambert said. “We put an offer in and he counter offered and the counter offer was still relatively close to what our primary offer was. We felt like we got a good deal.”

Now the couple is dealing with a mortgage payment that is $300 less than what they were paying for rent in their former apartment, and they have the same amount of living space, plus their own yard.

It helped greatly that the home was move-in ready, with the seller having purchased the home as a foreclosure.

“The house on the inside was basically destroyed,” Lambert said. “He did a heck of a job getting it to where it is now.

“Both my wife and I work minimum wage retail jobs, so if it wasn’t move-in ready, we really wouldn’t have been able to have looked at those kinds of houses. We just don’t have the money to make it move-in ready right now.”

First-time home buyer Jaye Mayer’s search for a home in the Hamilton area led him to meet with Realty First owner and Realtor John Holbrock, who arranged for him to tour about three homes in his price range on a weekly basis for three months.

Living in a small apartment with his girlfriend and their newborn daughter, Mayer opted for a one-story house with no basement at 458 Rockford Drive.

The Hamilton home appraised by The Butler County Auditor’s Office for $82,860 in 2011, down from $89,390 before that.

The house was listed for $74,500. Mayer bid $67,000.

“It had new carpet, new paint, a fridge, stove and a washer/dryer,” he said. “It was pretty much move-in ready.”

When the seller countered at $67,500, Mayer quickly accepted, happy that he had scored such a good deal and was able to move out of the apartment in which he had lived for the prior two years.

“It’s a good neighborhood and a nice house for my girlfriend and my daughter,” he said. “It’s better than an apartment. It’s a good starter home for us, I guess.

Having a Realtor helped greatly in finding a new home, Mayer said.

“He had everything lined up in my price range for us to go look at,” he said.

Crisis past, full recovery distant

The worst of the housing crisis is definitely in the past, said Ritchie, who remains cautiously optimistic about it continuing on a positive path.

Prices now are at their 2002 levels but not yet at the high point of 2006.

“When people say ‘it’s coming back,’ are you saying to the highest point we ever had in our history or maybe from where we should have been?” Ritchie said.

Sales have been higher in every month of this year compared to last year, barring March 2012, Ritchie said.

“Our median price has been up 4.6 percent for the Greater Cincinnati area for January to September this year over last year,” she said.

Last year in the month of October, Owens’ office had 30 contracts.

“This year in October we had 39,” Owens said. “So that’s … a 30 percent increase.”

In many cases, lender-owned properties are being rented and released slowly for sale so they don’t flood the market, Ritchie said.

A complete recovery, however, will take years thanks to downturns in the financial markets, skyrocketing unemployment, overextended banks and sluggish business.

“It wasn’t just housing,” she said. “There’s a lot of things that went on.”

Owens also said a complete recovery will take several years.

“I mean, we took big hits,” she said.