Oil and gas impacting area real estate market
Across the Ohio Valley, hotels are opening, houses are selling at higher prices and apartments are renting quickly – all because of the influx of natural gas and oil workers.
“This, in my opinion, is the greatest thing that has happened to this area,” said Mike Sulek, owner of Sulek & Dutton Real Estate. “I see the enthusiasm in our realtors because they know they have a better chance to make a sale.”
On the hotel front, the new 55-room Comfort Inn along National Road between St. Clairsville and Blaine is now open. Construction also continues at the new 85-room Microtel Inn and Suites by Wyndham, set to open adjacent to the Hampton Inn in St. Clairsville this year.
“We are extremely happy to be open,” said Jackie Newton, general manager of the Comfort Inn. “There is a high demand for hotel rooms here.”
Tom Carpenter, a partner with First Choice Realtors, and Carl Nix of Harvey Goodman Realtor said they are not seeing as much impact in terms of selling houses, but they are feeling the effect on the rental market.
“There are a ton of houses that would normally sell that are being held by the owners because they know they can get extraordinarily high rental rates right now,” Carpenter said.
However, Sulek said the oil and gas industry has been a “major economic driver” for his business. In addition to the workers looking for housing, mineral owners receiving lease money or royalty checks may be looking to buy new homes.
“Over the past couple of years, it seemed like most of the people coming in were pipeliners or other hands-on workers who were looking to rent because they were only going to be here for a short period of time. Now, it seems as if we are getting different people coming in, people who are planning to be here for 10-15 years,” said Sulek. “Because they are going to be here longer, they are more likely to buy.”
Sulek also said there are not enough existing homes on the market, so he sees a demand for new construction on the way.
“These people are new to the area, so they don’t have any pre-conceived notions about where they would like to live. To them, a nice house is a nice house,” he said. “We went through a time when it was very difficult. I think the new influx will help everyone.”
Carpenter, however, sees the matter somewhat differently because he said most of the increase in business has only been from rentals.
“People are paying higher rents, but it has not helped me sell any houses,” he said.
Nix also said the majority of the business he sees related to the oil and gas industry still involves rentals, noting that many of the workers receive housing subsidies as part of their compensation.
“I have seen some local people buy a house for $50,000 or $60,000, fix it up a little bit, and then rent out the rooms,” he said. “People are still looking to rent like crazy from what I see.”
“I think the overall housing market is pretty strong around here now,” Nix added. “If you get a nice house on the market, it is going to go faster than it has in years.”