| Long Island home prices have declined over the past | | | | That clearly wasn't the case. I've given up trying to |
| four years now. It almost doesn't seem real. Four | | | | figure out home buyers in this market. |
| years is a long time. And I think that it's starting to finally | | | | Moving forward, I'd like to take one zone randomly and |
| impact every homeowner out there. We're all feeling | | | | demonstrate on a somewhat local level, how inventory |
| the effects of this unbelievable market. From Montauk | | | | (supply) far exceeds demand (buyers). In zone 21, |
| into Manhattan, this "downstate", Long Island real estate | | | | which makes up a number of towns along the south |
| market has felt the burst of the bubble. | | | | shore of Long Island, there were 3,156 homes for sale. |
| So when is this going to end?! | | | | Only 134 of those homes sold. Less than 5% of the |
| In December 09's, The State of the Long Island Real | | | | homes available are selling. That means less than 1 in |
| Estate Market, I dove head first into a very accurate | | | | 10 homes are selling in that zone, and that's about the |
| picture of where the market was headed. And overall, | | | | same for all the rest of Long Island. |
| there were some promising numbers. Across Long | | | | When we look at the numbers from December, 2009 |
| Island, there was much less devastation to the market | | | | though, we see the phenomenon I mentioned earlier, |
| in terms of declining prices. | | | | the cycle of homeowners waiting to put their homes |
| But as I look at the market for what it is, I see a few | | | | back on the market. It's a cycle we're going to see |
| things. | | | | throughout 2010 and into 2011. The same homeowners |
| First, there are so many homes that have been on the | | | | not selling in one time period, wait to put their home |
| market for a long time. The same homes, not selling, | | | | back on the market later down the road. |
| month after month, year after year. | | | | To prove this point, in December of 2009, there were |
| Secondly, I see a ridiculous amount of homes expire | | | | 28,479 homes for sale. And in February of 2010, you |
| off the market (they don't sell) and what these | | | | can see there were 29,175 for sale. The problem here |
| homeowners are simply doing are waiting for the | | | | is obvious, demand has declined and inventory has |
| exact moment (along with all the others like them) to | | | | increased. When that happens to any product, from |
| put their home back on the market. This cycle will | | | | sneakers to cheeseburgers to cars and to houses, |
| perpetuate one thing and that is waves of increased | | | | economics 101 teaches us that prices of that product |
| demand, which will not fair well for Long Island home | | | | must go down in order to sell. |
| prices. | | | | Now the fluctuations in real estate can come |
| The evidence will be in the numbers. | | | | extremely quickly. For instance, I'm going to say that by |
| The following are statistics for February, 2010. I want | | | | the end of April of this year, we're going to see a |
| to point out the numbers emphasis the disturbing reality | | | | great increase in buyer demand. Which would indicate |
| of the Long Island Real Estate market. In Suffolk | | | | a "stabilizing of prices". Why do I put that in quotes? |
| county there were 11,767 homes for sale and 555 | | | | Because it's a stabilizing of prices for homes that are |
| sales. 8,351 homes were available in Nassau, with 538 | | | | priced right. |
| sales. In Queens county, 9,057 were available in | | | | The same people who have their homes priced |
| February and 451 sales. | | | | ridiculously out of the market are a nonentity. Buyers |
| The total available inventory for Long Island was | | | | are not going to buy those homes. The "stabilizing" of |
| 29,175 residential units available for sale. The total | | | | prices will be in that 5% to 15% of homes that are |
| number sold was 1,544. | | | | priced correctly and the competition between buyers |
| Let's pause for a moment and look at circumstances. | | | | for these select homes will be incredible. |
| February, 2010 closings are an indication of December, | | | | I will leave you with this bit of insight. I recently had a |
| 2009 inventory that went into contract (remember a | | | | home hit the market for $580,000. I had an open house |
| home goes into contract, but it takes 1 to 2 months to | | | | recently during the first week it was on the market. |
| close normally). Traditionally, home contracts decline in | | | | There were over 100 people at the open house. The |
| winter months. So the dip in homes sold doesn't | | | | home sold in less than 7 days. I received over 10 |
| surprise me all that much. | | | | offers and the home sold for more than asking price. |
| However with mortgage rates so low, it is somewhat | | | | There are buyers for every price range. They're just |
| disappointing. With rates at historic lows and motivated | | | | waiting for you to list with the right agent who can |
| sellers on the market in winter months, I would figure | | | | consult you on accurate pricing and market the home |
| that a smart buyer would be out looking for a deal. | | | | effectively to sell. |