Sorry I haven’t posted much in the last few days. I’ve been slammed-to-the-wall busy for the last week. Go figure. I’ve seen a big jump in people asking about properties, and this weekend — for the first time in about 6 months — I had a completely full schedule, with 4 appointments, and had to ask the other broker I work with, Judy Siegel, to go out with 2 others. Part of the upturn, for me, can be attributed to the new MLS Search capability on by website. A lot of people have been using it and asking about properties they’re finding.
But there are definitely other factors besides that. I think that the upturn in the stock markets along with the sharp pullback in gas prices has revived a sense of economic optimism that is counterbalancing somewhat the barrage of media reports about the housing market pullback.
In the past few weeks I’ve been quite heartened by the discussions I’ve been having with buyers. Many are quite sophisticated and insightful about the real estate markets, particularly looking beyond the national doom and gloom reports, and understanding that real estate markets can be very local, with almost ‘micro climate’ dynamics. This week Moody’s published a report that real estate price declines are expected in the next few years in 100 major markets, but then breaks those markets out. Our sympathies to homeowners in Cape Coral, Florida, topping the list with an anticipated 18.6% decline. New Yorkers fare much better, with just a 3.5% drop predicted between now and April, 2008.
After the annual double digit increases on the past few years, you might think that any decline would cause alarm and bring real estate sales to a screeching halt. But the Moody’s report is actually good news, at least for New York City. The fear among buyers has been of a much greater fall off — a 20% or more decline in prices. Nobody wants to be the last fool in to any market. The elephant in the room all through the summer has been this underlying fear, or at best, unease, that if you buy something today for $400,000, will it be worth only $300,000 next year?
It just doesn’t seem to be playing out that way here. What I’m finding out lately is that one thing hasn’t changed — young couples, in particular, want their own house! It doesn’t look like there is any big collapse on the horizon for Manhattan real estate that will suddenly make a Chelsea coop affordable again, and those young couples want to have something to call their own. So the trend of ‘continue renting in the city and buy upstate’ is still strong.
The big difference between these buyers today, and the buyers in the market here in 2004 and 2005, is that these younger buyers are not primarily motivated by investment or appreciation, but rather by ownership. They want to put in the new kitchen they’ve dreamed of, and it’s theirs, not the landlord’s!
Overall, I think that market is Sullivan County’s ace in the hole. We’re affordable enough for young couples to buy a buy a nice getaway here for $250,000 to $350,000 and still afford to keep renting their apartment in the city.