Johnston County — Housing starts in rural Johnston are down 39 percent from a year ago, according to the county’s planning office.

In the first nine months of 2008, the county issued 1,013 building permits for houses, down from 1,668 in the same period a year ago.

Greg Johnson, who builds houses in Johnston and Wake counties, said he was on pace this year to build half of what he built in 2007. Johnson said news of frozen credit markets was scaring away potential buyers.

“People think they can’t get a mortgage,” he said. “If you ain’t got no money to put down but you got good credit, then you are able to buy a house. People just think its doom and gloom.”

While housing starts are down, sales are slow too. In September, buyers snapped up just 151 of 1,917 houses on the market in Johnston, according to the county’s Multiple Listing Service. Of the 1,917 houses, 812 were new, and 61 of those sold, according to the MLS.

The picture could be much worse, said Johnson, noting that the number of unsold new houses was not that high. “We got 812 on the market, and if we get it down to 500 or 600, then we can start building again,” he said.

The fall-off in home sales has been steep, said Valorie Stevens of Stevens Realty. “In my 13 years of experience, this is the most dramatic I’ve seen it drop off,” she said.

Stevens said Johnston County real estate agents were feeling the effects of harsher economic times in other states. “I’ve lost a lot of business from people who live out of state, especially in the North,” she said. “It is a direct result of them not selling their houses and they can’t buy houses here. I have one client who bought a home in Hunter’s Mill [subdivision] a year ago and his house in New Hampshire has been on the market for three years.”

Fortunately, Johnston County remains an attractive place to live, said Joey Millard-Edwards, a broker with Carolina Realty. “I think I have certainly seen a difference from last year to this year,” she said of the drop-off in sales. “I think everyone is being a little more cautious right now, which is why you’ve seen a drop in permits. However, I think we are in a fabulous location and blessed to live where we live.”

Like Johnson, Millard-Edwards said attractive mortgages were still available despite the upheaval in credit markets. “There is still 100-percent financing out there,” she said. “I think if we utilize the opportunities we have and the tools we have, there is no question we can survive this market.” For Johnson, those tools include holding open houses, using interior decorators to stage homes and making sure landscaping is well maintained.

Brack Wilson, a broker with HTR Commercial, said commercial real estate was slower to feel any downturn because of the nature of the business. “In a house, you can close in two weeks if everything goes well,” he said. “If everything goes well with commercial, it’s almost six months, and most of our stuff is up to one year. We are busy, but we are finishing up deals we started six to eight months ago.”

For healthy businesses that need to expand, now is the time to build, Wilson said. “A lot of construction companies are looking for work, so your labor will be a little cheaper,” he said. “Now building supplies are still up, but some have come down a little bit. Land that has been sitting for awhile now all of the sudden needs to be turned into income.”

Some commercial enterprises are heeding Wilson’s advice. “We just recently got a Bojangles’ approved in McGee’s Crossroads right across from the Food Lion shopping center,” said Berry Gray, the county’s interim planning director. “I think the Wal-Mart at Interstate 40 and N.C. 42 is going to pull permits soon. That will help some.”