Westchester high end home sales plummet
 
The stock market turmoil of last year is evincing itself in a way that doesn”™t often make economic statistics, but is particularly revealing: The sale of high-end homes in Westchester is down markedly compared with recent years.
While in 2007, the sale of $1 million-plus homes made up more than 25 percent of the home sales in Westchester County, this year they comprise only 13 percent of sales in the first quarter, according to statistics compiled by the Westchester County Board of Realtors.
“It appears from the dismal first quarter results that the Westchester real estate market as particularly hard hit by the chaos that occurred in the equity markets during the autumn of 2008.” the group writes on its Web site, in announcing first-quarter sales figures.
While figures were down across the board in Westchester. The 850 homes sold in the first quarter represented a volume reduction of 37 percent from first quarter 2008. And the first quarter median sales price of $532,000 was down $90,500 or about 15 percent from the same period last year.  Â
“Prices are down by about 15 percent and that”™s quite a lot by Westchester County standards,” said Gilbert P. Mercurio, CEO of the board. He noted, however, that in other parts of the country, such as Phoenix, Las Vegas, Southern California and Florida, sale prices are down by up to 60 percent.
But the high-end market is really hard hit in Westchester.
“The story is, we reached a peak as to the influence of high end properties on the market in 2006-07,” said Mercurio. In that year, sales of million-dollar-plus homes constituted just more than one quarter of all homes sold in Westchester County, “It eased somewhat in 2008,” Mercurio said, when the percentage was about 23 percent of all homes sold.
Then it has “plummeted” thus far in 2009, he said, down to about 12 percent of the market. “And these percentages are backed by what brokers are saying,” said Mercurio, “That”™s been the segment of the market hit the hardest.”
The reasons are not mysterious. “I would tie it almost specifically to that close relationship Westchester County has to the financial industry,” Mercurio said. “It”™s an important part of our employment base; these are professionals who are highly compensated and tend to be the people who are active in the high end of the real estate market. And, so, when they experience hard times, as they have recently, it”™s going to reflect itself in the market.”
He said the financial industry workers tend to spend their bonuses on investments in real estate, a market that was particularly inflated after the attacks of 9/11 when investors sought real estate as a safe place for their money. Thus, he said, “I make a direct link” to the stock market drop and the reduction in high-end real estate sales. Â
“Its all different now,” Mercurio said. “I think what is really needed is a restoration of confidence in the economy.”