I’m noticing the market is definitely slower than 3 or 6 months ago. I’d venture a guess that the number of inquiries I’m fielding is down by a third to a half. But I’ve still been pretty busy with appointments on the weekends since Labor Day. Most people I’m going out with, though, are new to second home shopping and often making their first trip to Sullivan County to check us out. That’s been the case for the past few months — we’re one model being test driven along with a lot of others (Pennsylvania, Delaware County, the Upper Hudson, Greene County, even the Berkshires.)
Lately it seems we’re not doing well in the second home horse race. Of course, some of that can be attributed to a more widespread buyer hesitancy about real estate in general. But I’m sensing something more specific to Sullivan — that many buyers aren’t delighted with the values here, and are in fact, disappointed in what they’re finding. We Realtors can try to sweep it under the rug with a comment that buyers have unrealistically low price expectations. But at the end of the day, it is those expectations that drive the market.
Three or four years ago, before the start of the "boom", buyers were often blown away by the value they found here. $250,000 got you a pretty nice country getaway, and outside of Chapin and Lew Beach, $500,000 was a huge budget and could buy you the world. Smaller, 2 bedroom lakefront cottages could be had in the $250,000 range, and a nice 3 or 4 bedroom house on Swinging Bridge seldom climbed above $500,000. The occasional lakefront house that sold above $500,000, at York Lake or Black Lake, raised eyebrows.
3 or 4 years ago, there was also an optimism here that’s been tempered somewhat. Bethel Woods was under construction, and many believed it would become the summer home of the NY Philharmonic and a huge tourist draw. Casinos were edging closer to approval. Louis Capelli was floating plans for the redevelopment of the Concord. Hotel developers were scouring the county for potential sites, with plans leaked for five star resorts near Roscoe and Livingston Manor. Million dollar plus homes were rising at Chapin. New fancy restaurants were opening in Livingston Manor and Jeffersonville. The ‘New Catskills’ was on a roll, with Sullivan County at its heart. We even made the covers of magazines!
The psychology here shifted from seeing Sullivan County as a "value" destination to seeing us as a "world class" destination — a country playground, just 2 hours from one of the wealthiest, more powerful cities in the world. Some of us, me included, saw us as the New Saratoga Springs.
Four years later, all that optimism hasn’t borne a lot of fruit. Yes, Bethel Woods is open, and its a spectacular venue. But the expected surge in development related to it hasn’t come to pass. There hasn’t been a shovel put into the ground for a new resort or hotel. Many of our villages are still struggling. Some of the new restaurants fueled on all that optimism, like Resort in Livingston Manor and Stella’s in Jeffersonville, have closed. (To be fair, a number of new restaurants have opened in Kauneonga Lake, an unexpected new center of activity.) And casinos are dead in the water, at least for the time being.
Sullivan County is kind of in the same place we were 4 years ago. We’re an idyllic backwater with beautiful natural resources just 2 hours from New York City. We haven’t evolved into a New Saratoga or New Woodstock. We still don’t have a luxury destination hotel with a spa and restaurant.
We’re back to the USP (unique selling proposition) we’ve enjoyed relative to our second home competition — we’re the best value in a country getaway within 2 to 2 1/2 hours of NYC. But we may have lost sight of the "value" part of that statement. I don’t know where we need to be, pricewise, to recapture the value crown. But without a slew of world class amenities (like the Lodge at Whiteface in Lake Placid), what we have to sell is value and proximity. Consider lakefront buyers, for example. Lately, a lot of folks looking for a lakefront second home with 3 bedrooms seem to be thinking in the $400’s, while most lakefront houses of that size are priced in the $500’s. For a smaller cottage-sized 2BR lakefront, buyers seems to be thinking low $300’s, while the asking prices for those are more in the high $300’s.
I expect things to be sluggish over the next few months, until the uncertainty hovering over the real estate markets settles. But we also need to take a hard look at the value proposition here. We need to bring back the words "great value" on the lips of our potential new neighbors.