Gil Mercurio, CEO of the Westchester-Putnam Board of Realtors, hasn”™t finished compiling the 2010 stats and absorbing just what kind of year it really was. “But there”™s one thing I can be clear about, the tremendous amount of uncertainty in the market in the new year.”
Jerome Billingsley, whose Putnam and Westchester offices have been in business more than six decades, said 2010 was better than 2009, but the market is hurt by a number of factors and some indications leave the long time real estate broker wondering what the new year will bring.
“Rentals in Putnam are snapped up as soon as they go on the market,” Billingsley said. “And although I see new construction, particularly condos, going up, I also see a lot of land at unbelievable prices just sitting there. I know it sounds contradictory, but then again, the entire real estate market has been on a roller coaster since 2008. We also have to deal with Connecticut being just a few minutes away from our border.”
Mercurio said Westchester and New York City have traditionally had a very close relationship, “but while the city”™s market is doing well, it doesn”™t seem to be sending people to the suburbs as it had in the past. We”™re also dealing with two markets ”“ the high end and everything else. And a new, third market is growing: the foreclosed and short-sale market ”“ we are trying to ascertain just which direction they are going in.”
“Leah Caro, president of the Westchester-Putnam Board of Realtors, said the market is much better down in lower Westchester,” said Billingsley, whose father started the real estate company, now in its third generation.
“Dad saw things turning sour before the 1929 crash and again in 1939 before the war in Europe really escalated. So we really can”™t be sure what to expect.”
Dealing with banks has seen some significant changes, added the longtime owner/broker. Billingsley and his mother would co-sign loans for first-time home buyers as added insurance for the bank back in the 1960s. “We”™d also guarantee that if they were moving from a condo to a home we would take over the mortgage if the condo didn”™t sell in 90 days. It was rare for us to ever find ourselves having to take over a property. Those kinds of guarantees are out of the question today. As far as dealing with the bank”™s requirements, they”™ve done a total about face from the way they conducted business and loans were made based on a credit score. The paperwork is staggering, and the decision making seems to take forever ”“ there are fewer ”˜home runs”™ than we”™ve ever experienced in my 60 years in this business.”
Mercurio is concerned about the unemployment situation. “We can be happy to see the number crawling slowly down, but at the same time, it is at a historically high level, with people out of work a very long time, possibly generating foreclosure activity. Loan modifications are out there, but they are evidently not working as they should be. The stock exchange is another unknown: the Dow Jones has exhibited erratic behavior throughout 2010. It may have closed out the year at a higher level, which ordinarily would be encouraging. But its erratic behavior can”™t be relied on as a sign of better times ahead. All of these things affect real estate, and it”™s hard to know which way it will go.”
Billingsley expressed concern about appraisers coming from out of state for banks. “They may look a half-mile in the wrong direction. A house in a great area may get a lower appraisal because the appraiser has looked at another town. That can really hurt the seller. Borders do not necessarily coincide with mailing addresses, nor do the school districts. So it”™s a problem.”
Billingsley said since interest rates are climbing, more buyers are incentivized to come out and look ”“ and perhaps more ready to make the transition from renter to homeowner. “Interest rates are at a historic low ”“ and I don”™t think it will stay there forever. So I”™m more optimistic about 2011. Hopefully, it will be a better year. We have a new governor who seems to want to really do something about property taxes. I hope he can do it because people can”™t keep coming up with the money. Something has got to give.”
“The market has changed the way business is transacted as a direct result of the Internet,” said Ann Marie Silvani, a saleswoman for Rand Better Homes and Gardens in Tuxedo. “People are coming in prepared. They can search homes, neighborhoods, surrounding properties before they”™ve ever sat down with a Realtor, and when they do meet you, they already know exactly what they want. It”™s actually been a positive, not a negative, because I used to spend a lot of time trying to help people decide on what they needed or could afford. Now, with Zillow and other sites, they can see for themselves what their home is worth if they are the seller or what they want to buy if they are the home buyer. The salesperson is basically verifying the information they have culled off the Web. It has taken a lot of the guesswork out of the equation.”
People are still buying homes, said Silvani, who is getting ready to close her third deal in as many weeks. “If you are doing what you need to do wholeheartedly and are willing to work with your clients and stick with it, you will make sales. ”¦I”™m seeing more people coming up from the city because they want a home, and it”™s more affordable here than in the five boroughs. They see the value here. But as I said, this market is not for the people doing it half-heartedly.”
Predictions for 2011? Mercurio is cautiously ”“ emphasis on cautiously ”“ optimistic, while Billingsley said he expects new construction will be tailored down to homes that will be attractive and affordable for the middle class. For salespeople such as Silvani, who has worked in the field for over a decade, she said the key to closing a deal is “sticking to it and being there every step of the way for the seller is going to get the house sold. It may take longer, it may be more stressful, the bank may want more paperwork, but sales are getting done.
“We have a sharper clientele looking to buy… and buyers are also realistic. All either side has to do to do is a bit of research on the web. In the long run, the Internet has made the business better for everyone and makes it easier to put a deal together than it had been in the past, even when the market was not distressed. Everyone knows exactly what”™s going on out there and what they have to do to get it done.”
Interesting article…As the buyers’ agent for the “sold” house in the picture above, I can attest to many of the comments as far as Orange & Rockland County go. This wonderful historic homestead circa 1800 in Cornwall (Orange County) came to our office at Baer & McIntosh in Nyack as a “stale” listing on the market for just shy of two years. Correct Pricing & Proper Marketing was the answer to the sellers’ problems. The buyer came to me through our website, saw it one time, and bought it. Of course, we had appraisal issues, bank issues, and zoning issues (it is a multi-family), but with diligence, experience, and patience, we closed the deal in time for Thanksgiving. All of the facts remain the same, we are unsure of what the market will do in 2011. However, we at Baer & McIntosh in Rockland/Orange County & Member of Westchester Real Estate are confident that we will have another successful year. Inventory is good. Buyers are plentiful. It’s a new year and a new decade. We’re on the upswing.