Winning the Game of Real Estate
You’ve seen the headlines: house prices are down, foreclosures way up. Is there any good news? If you’re a first-time home buyer, yes indeed. From Chatham to Warwick, here’s the latest scoop on the Valley’s housing market
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Ride It Out
“Yes, national unemployment is up and the real estate market is down. But remember that the Hudson Valley does not necessarily have the same statistics as the rest of the country,” says Adele Arnell George, principal broker at Northern Dutchess Realty in Rhinebeck.
“States like California and Florida have been particularly hard-hit with sales drops and foreclosures compared to our region,” she notes. According to the New York State Banking Department, there were 50,032 properties statewide with foreclosure filings in 2008 — ranking New York 35th in foreclosures among the 50 states.
In Dutchess, home prices dipped about 12 percent, and purchase offers are off 20 or 30 percent in the past year, she says. “But there are still pockets of fairly steady prices in places like Rhinebeck. Prices have gone down, but they haven’t plummeted,” George adds.
And even though there’s valid cause for economic concern — nearly everyone in the Valley has been directly or indirectly affected by job insecurity or loss, the housing tumult, or other aspects of the financial upheaval — real estate pros agree on one thing: The market moves in cycles.
“This has been a particularly difficult period, but you’ve just got to ride it out,” says Steve Domber, president and principal broker at Prudential Serls Prime Properties in Hopewell Junction.
“The news of the day is not very upbeat, to say the least,” agrees Sal Prividera, Jr., director of communications and marketing for the New York State Association of Realtors. NYSAR reports that statewide sales by realtors of existing single-family homes were down 16.2 percent last year compared with 2007; they’ve dipped a whopping 23 percent from 2006.
When it comes to prices, NYSAR says the statewide median selling price of a home last year was down 8.5 percent, to $215,000, compared with the $235,000 median in 2007.
The numbers tell the story: Those golden years of the housing boom are definitely over, at least for now.
“2005 was actually the best year ever for real estate in New York. The largest number of existing single-family homes were sold that year since we’ve been tracking records,” Prividera explains. “Back then, in much of the Hudson Valley there was low inventory, a greater number of buyers, and the economy was plugging along very well. We saw this in 2005, and also in ’04 and ’06 — low inventory led to bidding wars that drove prices up tremendously.”
But it was bound to change, he says. “It’s simple economics with nearly any commodity, including housing. Over time, demand relaxes and prices soften. If you take that period from about 2005 to 2006 — in New York State and across the country — it was an unsustainable, unrealistic, once-in-a-lifetime market.”
Maybe that’s the silver lining in this sobering new real estate reality: Now that the bubble has burst, experts are seeing a return to sound, sustainable basics when it comes to the world of real estate.
Next: Get into a new mindset