LIMA — If you have the means, $500,000 can go a long way in terms of housing in the region.
Homes sold in this price range will afford buyers an ample amount of square footage — usually more than 3,000 — more bedrooms and bathrooms than the typical residence, and amenities such as a three-car garage, custom woodwork and a finished basement.
Along with the home, the lot on which it resides is often much larger. Most homes in this price range sit on one to five acres, with some as high as 10 acres or more. Properties with this amount of acreage sometimes include a pond and outbuildings.
For example, a two-story home in Lima that is currently on the market features 16 acres, more than 3,600 square feet, four bedrooms and bathrooms, a three-acre stocked pond and a three-car garage. The home is listed at $575,000 and is located in Bath Township.
While $500,000 homes are out of many people’s price range, those who can afford it are getting the most for their money in Allen, Auglaize and Putnam counties, due in part to less demand and a cheaper cost of living than major markets in Ohio.
“A half-million dollar home here is going to be a million dollars in a larger market,” said Scott Weaver, of Real Living CCR Realtors in Lima. “That’s what I mean about getting the most bang for your buck.”
In Allen County, there were 24 homes that sold for $500,000 or more since 2007, according to the Allen County Auditor’s website. Of these 24 properties, nearly all were in Shawnee Township. A sales search revealed that 20 luxury homes were located in Shawnee, three were in Elida and one was in Bluffton.
A more detailed breakdown of the luxury housing market showed that four homes sold for exactly $500,000, nine were purchased for less than $600,000, nine more fell in the $600,000 range, and two were listed for more than $700,000.
But with a limited amount of buyers, luxury homes are moving at a much slower pace than those listed under $300,000. Those who can afford higher-end properties — namely physicians and business executives — are choosing to rent instead of buy.
“It’s been like that for the last three years or so,” Weaver said. “I just don’t think a lot of these doctors are fully committed to being in Lima longer than their three- to five-year contract. That’s kind of hurt the upper-end price point.”
Another factor is the downturn in spec building, which means that builders aren’t constructing luxury homes with a specific buyer in mind.
“They haven’t built spec homes for 10 years, ever since 2007 with the downturn of the economy,” said Debbie Lane, a sales agent with Cowan Realtors in Lima. “It used to be, 15 or 20 years ago, builders were building five to six homes at a time in Allen County. They’re no longer doing that.”
Lane said this is due to the high cost of building materials and a lower profit margin.
“They’re just not building in Lima because the profit margin isn’t such that builders can make any money yet,” she said. “Prices haven’t gone back up since the downturn of the economy, so that’s why there’s not a whole lot of new construction here.”
Brian Baker Jr., of Burden Construction, said home building has picked up in the last three years, but the properties that are being constructed are not higher-end, luxury homes.
“I’d say the housing market is the best it’s been in maybe seven or eight years, but most homes we build are in the medium price range of $260,000 to $350,000,” Baker said. “Very few of the very high-end homes are being constructed. There’s maybe one or two being built in our county that I’d describe as very high end.”
Weaver said this has led to a buyer’s market for luxury homes, as opposed to the seller’s market that is occurring for medium to lower-end housing.
“Buyers do have a lot of choices at that price point,” he said. “The price really has to match the condition of the home, otherwise there’s just too many options for people. They’ll move on and find something else.”
There were 10 luxury homes sold in Auglaize County over the last 10 years, according to the Auglaize County Auditor’s website. Four were purchased in Minster, three in Wapakoneta, two in St. Marys and one in New Bremen.
Homes in this price range feature a similar amount of space and amenities as those in Allen County, though real-estate agents are also having similar problems moving these properties. In fact, anything more than $300,000 can take much longer to sell.
“Our office has had a few over the $300,000 mark, but they don’t sell as quickly as anything under $250,000,” said Jeremy Huebner, co-owner of Binkley Real Estate in Wapakoneta. Luxury homes “are definitely out there, and I think there’s a market for them, but they just take a little bit longer to find that right buyer.”
Huebner said they have seen a couple of luxury homes built in Wapakoneta in the last two years, but he reiterated that new builds are usually less than $260,000. He added that this is especially true when it comes to spec building.
“When you’re spec’ing a house, you want to make sure you’re selling that to a larger group of people,” he said. “I think that $250,000 and under is probably your largest group of buyers out there right now.”
The number of homes that sold for $500,000 in the last decade is even less in Putnam County, where higher-end properties are typically selling for $300,000 to $400,000. There were a total of nine homes that sold for $400,000 or more since 2007, including just two that were listed at $500,000.
“A lot of [luxury homes] are out there, but they don’t come up for sale too often,” said Krista Hughes, a real-estate agent for Irwin Real Estate in Ottawa and Columbus Grove. “People building that type of home are usually staying there for life.”
But the number of people building luxury homes is few and far between, according to Sue Schroeder, of Geyer Noakes Realty Group in Ottawa.
“The cost of buying an existing home is still cheaper than building one because building costs are quite high,” Schroeder said, adding that spec building has also seen a downturn. “That’s what I see in the upper-range homes here in Putnam County.”
When luxury homes do hit the market, Schroeder said there is high demand. This has led to a buyer’s market for higher-end homes, which is similar to what real-estate agents are saying about the market in Allen and Auglaize counties.
“When [luxury homes] do come up, you have more of a demand for them,” she said. “Buyers are out there, but the homes still have to be priced right and you have to pay attention to the market.”
Reach John Bush at 567-242-0456 or on Twitter @Bush_Lima.