Milford’s housing market booming with room for growth

MILFORD — The housing market in Milford has been doing well for a while now, but with coronavirus gripping Delaware, it’s become hotter than ever.

“Right now, we’re seeing a very, very hot seller’s market,” said Zachary Foust, the owner of Milford-based Loft Realty. “Ninety-four percent of homes (we had) in May sold within the month.”

Rob Pierce, Milford’s economic and planning director, is happy with that news.

“The seller’s market … is good from a municipality standpoint because the city does generate revenue on realty transfer taxes,” he said. This applies to both existing homes being sold and the purchase of newly built homes.

Mr. Pierce said as of June 1, the city has issued 85 new housing permits this year. That’s up from 65 in the first six months of last year.

Of the 85 new permits issued so far in 2020, he said 50 have been issued since March 1.

“I think that a lot of people are thinking because of corona that the housing market is hurting, but it’s really not,” said Jordan Butcher, the marketing director at Loft Realty.

Early in 2020, Ms. Butcher thought the area was experiencing a seller’s market, and “it was — 74% of the homes that went on the market in January sold that month,” she said.

But Mr. Foust called the current state of the market “unprecedented.”

Although the uncertainty surrounding the virus initially led to what Mr. Foust called “an emotional standstill when it came to buyers and sellers” in March and April, by May, “the interest rates dropped,” leading to a huge uptick in interest from buyers.

“The interest rates are at historic lows,” said Joanne Milton, a broker at Coldwell Banker Resort Realty in Milford. “What I find is that I’ve got is retirees and even dual-income families that are buying up because the low interest rate, around 3% or so – in some cases even less, allows them to buy much more home.”

Now, Mr. Faust said there are many people who have been preapproved for loans, but not very many houses on the market for them to buy.

“Multiple offers are commonplace today because of the low inventory out there and (sellers are) getting close to what they’re asking or better,” Ms. Milton said. “There are very few concessions any more, meaning closing cost assistance or other concessions back to the buyer.”

Ms. Butcher has “been putting out a lot of content trying to get more people to want to sell their homes because homes are selling for more money … We need more houses.”

According to a local market insight report for May 2020 provided by Ms. Milton, there were just 32 new listings last month, which is down over 40% from the 56 listed in May 2019.

The same report said that on average, houses were on the market for just 55 days in May 2020, which is down from 67 in April 2020 and 85 in May 2019.

Milford’s city government seems to have taken note.

Earlier this month, City Council approved hundreds of new units, including an additional 46 at Ryan Homes’ already partially built Milford Ponds subdivision on U.S. 113 south of town. That brought the total number of approved units there to 768.

“Milford Ponds was approved in 2004 for what they’re currently constructing,” Mr. Pierce said. “There are central utilities currently on the site that are serving the property, and there are other areas that are already annexed into the city around it that will help incorporate it into the general feel of the city.”

Mr. Pierce added that Ryan Homes will “provide a bike path along Walnut Street (on the back side of the property) … from the entire length of their frontage and then the neighbor’s property” to further City Council’s goal of expanding Milford’s bike network.

Despite the council’s focus on biking and walkability, attributes often associated with density, there’s a lot of unsettled space within city limits. A 2018 update of Milford’s comprehensive plan said that 46% of the town’s footprint was either vacant or agricultural land.

Mr. Pierce sees these spaces as room for growth.

“We’ve estimated that within our municipal boundary, we could grow another 10,000 units without having to annex another piece of ground,” he said.

“We’ve probably had close to 5,000 units approved on paper that have gone through the development process with City Council” since the mid-2000s, Mr. Pierce said, and “another 5,000 units on paper that could be built on land that has no prior preliminary or major approvals on it.”

At present, Ms. Milton said “there’s still more demand out there than there is inventory.”

She said it will take between 90 days and six months for a home in an already partially developed subdivision like Milford Ponds to enter the market after construction begins.

But Ms. Milton was happy with the development moves being made in Milford to meet that increased demand.

Although she said, “it’s definitely a seller’s market, because demand is high and the inventory is low,” the cycle is “coming back (around). There’s more homes listed every day.”

Mr. Foust was also very enthusiastic about the situation.

“It’s just growing exponentially,” he said of Milford. “Demographically, it shows very similar trends to Middletown in 2004 before what it is today.”