The good news is that the overall economy is recovering.
What a joke and you’re right I’m not laughing. The bad news is that it’s recovering very slowly. Today The Associated Press reports that prices are stuck in a free fall. It’s all over the net and can be found on countless brokerage sites across this land.
The big question is … Does it apply to those of us who live in The Hamlets? Look over my shoulder as I put together this report and we’ll see. But first a closer look at what the AP reports. For the full article, go here.
Why is the housing market such a mess? Why are companies closing left and right and realtors leaving the industry ? According to an article entitled Home Prices Stuck In A Free Fall (AP/Washington – Derek Kravitz) the answer is simple but with complex complications. Here is some of what Kravitz presents:
Foreclosures (which sell on average at 20% discounts) are pull prices down even further, a huge inventory of unsold homes, and buyers fearful of making the leap right now either due to personal fears and/or the inability to borrow. It’s highly probable that many buyers are staying out of the market simply because they feel the market has a much deeper bottom. Are we there yet? By the way, buyers “fear of purchasing” is stimulating the rental markets. So one segment of the market increases while another decreases. Interesting! Kravitz also reports that for the eighth straight month the nationwide index fell with a forecast that we may drop another 5% before year’s end. Oh my! Mark Vitner (Well’s Fargo) says “It may be early next year before prices hit bottom.” Hmmmm where have I heard that before?
THE UNFORTUNATE 12 – There are 12 cities sited in Kravitz’s article. New York is one of them. But what about Rockland County Real Estate? How does all this affect Rockland Real Estate, and certainly The Hamlets? That’s what I’m attempting to learn as I dig deeper into market stats for The Hamlets this evening. (Yep, I’m workin’ tonight!) So .. I think I’ve written enough about the rest of the country, let’s take a look at what’s going on in The Hamlets.
ACTIVE LISTINGS now. There are currently 28 listings for sale now.
The most current listings are toward the top
* Under 300,000 – There are currently 12 listings (1-2 BR and 2.5 Baths) and some in Clarkstown Schools
* 301,000 – 350,000 – There are currently 10 listings
* Over 350 – 6 listings
* NOTHING is selling over 400K.
The first thing I want to point out is that to be able purchase a unit with 2 bedrooms AND 2.5 baths under 300K. Wow! That’s simply amazing to me. But it’s happening.
TThere are 5 properties currently under contract and waiting to close. Take a close look at the CHART BELOW and the column labelled PD. PD stands for Pending Date (or the date the owner accepted the offer) If you frequent my blogs you know that I show that date because it is a TRUE indication of what buyers are doing and how long it’s taking properties to fund. Many transactions fall apart at the funding point because lender’s underwriting guidelines are quite strict now. Few qualify. Few! Right now cash is truly King! We are at the height of the spring market. I should be seeing 20-30 properties at a minimum waiting to close. I see “5″. Oh my.
.
The next chart is the units that have sold in the last calendar year. From June 3 of 2010 to June 3rd of 2011 53 properties sold. Hold on one second though. Not bad you say?. Only 8 Hamlets Units sold and closed this year. Let’s divide those 8 properties by the 5 months that have passed this year …
So … 8 Divided By 5 = 1.6 units sold per month. Less than 2 units are selling per month Hamlets wide.
In a spring market !!!! OM goodness.
Further, a closer looks shows that only 45 listings sold in 2010. If that seems like a lot to you, remember that expert economists feel that many of those title transfers we saw in The Hamlets in 2010 were stimulated by the tax credit. So don’t be tempted to divide those 45 sales I just mentioned in 2010 by 12 (months) and think that my 1.6 sales per month figure (just sited above) is inaccurate. We consistently see 1-2 sales a month across the board in the condo market. Pricing is key.
So the question is this: Is your unit properly positioned so that YOU are pulling in that elusive 1 “maybe” two buyers?
I’ll say it again … pricing is key folks. Please dont’ be fooled if you have new kitchens/baths, etc., these buyers are savvy and they know they can buy a lot of upgrades for something they can get $30 to 50K less. Alot of the old rules dont’ apply.
A couple of more charts and we’re done >>>
Let’s look at what happened back in 2001 and 2003. Why? Well in the doomsday article sited above they mention that after adjusting for inflation, the home-price index has sunk to a level not seen since 1999. Ouch! I live here and I suffer in this too. This means I have to hold my investment for a very very very long time. If I dont’ have to sell, I won’t. I’m confident my neighbors feel the same.
Look.
So, the bottom line is this: If you are a buyer “it’s a great time for you, especially if you have cash, and/or a minimum of 20% down with perfect, and I mean PERFECT credit.
If you are considering a move, think long and hard about your options. It’s not all bad news. Remember you are selling low but you are also buying low. The trick is to secure YOUR buyer, and to do that you must be savvy. You must absolutely be perfectly positioned to draw that elusive 1-2 buyers in to YOUR UNIT. How? Pricing. Perfect pricing. This is why we watch the market so closely.
Are you considering an offer right now? Study these charts carefully, consider your worst case. It could be by year’s end we are down another 5%. From where I sit, I say we are definitely still in a declining market. I’m not ready to say the F word yet. (Freefall). Not yet, but I’m starting to become tempted.
Oh and one final point . . . The residential market has been hit hard, BUT not as hard as the condo market. Click on the graphic below for more information on the Rockland Nanuet Residential Real Estate Market.
All the best to all my readers. Email me with any comments you’d care to make. Questions always welcome.
Subscribe to receive all my latest posts.
Angela Chan, Webmaster
SO…SHOULD I WAIT ?
Look below.
