Neil Binder has been making New York home sales since 1979, and this is the first time a reason has escaped him when it comes to explaining the booming market.
“The market is extremely strong across the board. [As of] January 1, everything was extremely busy,” Binder said last week. “Given what we had last year, we are all surprised. Last year was $h!t.”
Well, someone must’ve come by with a plastic bag, because in 2007, at least up until right now, the Manhattan housing market has been far from it.
Binder says that his real estate agents are reporting “open houses with 50, 75 people in attendance — that’s staggering.”
Mike Simon, president and CEO of Century 21 NY Metro, says that “spring came early” in 2007, with transactions at the brokerage picking up in December.
“We can’t see that ending in the new year,” Simon said.
Eight units of a new Chelsea development, 100 West 18th Street, went to contract in the first three days of sales during the brutal cold of late February, according to one of the conversion’s developers, Scott Aaron of the Brauser Group.
“I can’t say when they will all sell,” Aaron said. “What I can say is, if the pace keeps up, the pace that’s been set the past three weeks, it will be much sooner than we thought. I originally thought it would take six to eight months.”
Such New York mortgage demand and subsequent sales strength, if history is a reliable guide, should last at least through the spring, a season when activity normally picks up from the winter.
But if sales are already strong, then this spring, which starts next week, might flex stronger than springs normally do - especially if mortgage rates remain so low.
Last year’s was indeed a dud, as far as Manhattan home sales go: Condo and co-op sales dropped during the spring — April through June — from the three winter months before, according to home appraisal firm Miller Samuel, inching down from 2,005 to 1,934 (and then back up in the summer).
For 2005, however, spring sales dominated the year — 2,181, a 7.5 percent increase from the winter months of January-March, the most that year, which was also the year of record low home loan rates and a supposed Manhattan real-estate boom.
In the four years from 2002-2005, Manhattan condo and co-op sales increased each spring over the winter. In 2002, like in 2005, spring was the busiest sales season of the year — or, for that matter, of any sales season of any year going back to at least 1989.
In the spring of 2002, as perhaps a harbinger of the boom to come, 2,842 condos and co-ops changed hands, according to Miller Samuel.
The market’s strength now, and the prospect of a strong spring (a lot of winter contracts will show up as spring sales), have left real estate agents and mortgage brokers giddy but a bit confused.
The housing market boom across the nation flopped spectacularly last year, and the melancholy pervaded through Manhattan, although by and large, the borough’s market stayed generally healthy.
If things are slowing all around it, why is Manhattan still - literally and figuratively - an island of success? And so suddenly successful after an excruciatingly normal 2006?
Follow the link to continue reading in the New York Observer …
Posted by Richard Barber on Mar 20 2007 under New York
Sales of new and existing homes fell 1 percent in January in the Albany housing market, as the real estate market continued to soften, according to figures released Monday by the Greater Capital Association of Realtors.
There were 576 closed sales in the 11-county region covered by GCAR, compared with 581 in January 2006.
Sale prices began climbing again, however, with the average price going up 2 percent, to $220,614, and the median price rising 6 percent, to $190,000. Such bumps could explain a drop in New York mortgage activity last month.
“The market has certainly cooled from the rather hectic years of 2004, 2005 and 2006, but it is still a strong market,” said GCAR President Douglas Engles.
GCAR Chief Executive Officer James Ader said there are indications the market has reached “the bottom of its downward curve” and there are signs activity will build slowly for the rest of the year. For instance, the number of contracts of sale in January rose 9 percent, to 782. That compares with levels of 1 percent to 5 percent in January from 2003 to 2006.
It typically takes about 90 days to close a deal after a contract is signed and the home loan paperwork is in order.
“It’s an indication that maybe two or three months down the line we’re going to see the slow sales figures turn around,” Ader said.
Nonetheless, GCAR said the region could end the year with fewer home sales than 2006, when a total of 10,387 homes were sold, a 1 percent decline from 2005.
“Maybe we expect that because that’s what we hear from the National Association of Realtors,” Ader said. “I hope we’re wrong with that.”
The aim, of course, is for demand for mortgages to pick up along with housing prices. As long as future owners plan on remaining in their new residence for more than a few years, there’s a good chance they’ll recoup their investment - at least - by time they sell.
Posted by Jed Moss on Mar 05 2007 under New York
Plattsburgh, New York.
While much of the Northeast continues to experience a decline in demand for mortgage loans, this Upstate location saw its overall housing affordability rise in the last three months of 2006 - thanks in part to some steam being let out of the housing bubble.
The cooling of the New York housing market during the last six months of 2006 might have been the bane of real-estate agents, but it did have the silver lining of making Plattsburgh a more affordable place to live and work, according to data collected by local officials.
In the first three months of 2006, the City of Plattsburgh’s overall Cost of Living Index had risen above the national average for the first time in years, due in part to a spike in New York mortgage costs.
The area’s home prices, however, started to stabilize in the second half of the year, helping the city regain its sought-after status as a better-than-average affordable housing location.
According to data for the last three months of 2006, Plattsburgh’s overall Cost of Living Index, at 99.4, was only slightly lower than the national average of 100 and 2.1 percent lower than the first half of the year.
In terms of affordability, Plattsburgh ranked better than New York State counterparts Glens Falls (108.0), Ithaca (111.5) as well as nearby Burlington, Vt. (118.4). It came in just behind Syracuse (99.3).
Like much of the rest of New York state, Clinton County’s housing market stabilized in the last fourth of 2006, with a slowdown in home prices and what was described by the New York State Association of Realtors as a “return to balance between buyers and sellers.”
- Overall, sales of existing single-family homes in Clinton County increased by a modest 1.8 percent between 2004 and 2005 and by 4.2 percent between 2005 and 2006.
- November 2006 sales, however, were down sharply in Clinton County, more than 40 percent below the previous month and nearly 35 percent from the year before.
- The median price paid for single-family homes was just more than $123,000 in the third quarter of 2006, which was virtually unchanged from the third quarter of 2004.
These relatively stable figures contrasted with other counties in New York, which experienced big fluctuations in both the number of homes sold and the prices paid for them as home loan costs became increasingly unaffordable for many.
For example, the number of single-family homes sold between 2004 and 2006 increased by a whopping 127.9 percent in Kings County (New York City) and by similar amounts in Suffolk County (Long Island) while the average prices for those homes jumped by more than 21 percent during that same period.
SOURCE: Plattsburgh Press-Republican
Posted by Richard Barber on Feb 28 2007 under New York
Since the start of 2007, a burst of New York mortgage activity has broken out in Manhattan and several Brooklyn neighborhoods.
Overall, New Yorkers are in the hunt for co-ops, condominiums and town houses, sending prices higher despite sluggish sales in many other U.S. cities.
Preliminary indications from real estate firms showed that this increased activity, with open houses jammed and bidding wars taking place, had occurred in all price ranges, from tiny studios to mansions, in counterpoint to the record sales of luxury properties that led the market in the late summer and autumn.
Real estate brokers and statisticians are quick to point out that not every apartment is flying into contract. During the last quarter of 2006, the major New York real estate agencies differed on which way prices were headed.
But now, the three largest real estate companies in the Manhattan housing market agree: For January, at least, both prices and the number of signed contracts rose in double-digit percentages compared with the same month in 2006.
With higher Wall Street bonuses, a strong regional economy and pent-up demand from New Yorkers who were once worried that the city’s real estate market would crash, the attitudes of home loan applicants have done an about-face.
“Their psychology has changed,” said Frederick Peters, the president of the Warburg Realty Partnership. “For almost two years, they’ve been scared that the market would plummet and they’d end up like fools who paid too much.”
Real estate experts say they see no reason for the trend not to continue, with economists predicting stable mortgage rates and a continuing surplus in the New York City budget. International interest, especially from Asia, has also picked up, with agents reporting good attendance at promotional events for high-end New York properties in place like Hong Kong and Tokyo.
However, other factors may alter New Yorkers’ renewed interest in buying real estate, including an expansion of the Iraq war, a changing employment picture or another terrorist attack.
Yet, there is “cautious exuberance,” according to Steven James, director of sales on New York’s Manhattan island for Prudential Douglas Elliman.
SOURCE: International Herald Tribune
Posted by Jed Moss on Feb 19 2007 under New York
As Long Island home prices continued to drop or stabilize, buyers snapped up homes last month, Newsday reports this morning.
In Nassau, Suffolk and Queens counties, buyers signed contracts on almost 2,600 pieces of Long Island real estate in January, a 25 percent jump from a year earlier.
Home prices fell in Nassau and remained stable in Suffolk and Queens.
In Nassau, the median home price fell to $450,000 in January from $470,000 in December - down 6.3 percent from a year earlier.
In Suffolk, the median closing price fell from $398,600 in December to $397,500 last month, but it was up 1.9 percent from a year earlier.
In Queens, the median price rose to $485,500 from 477,500 in December, and was up 0.1 percent from a year earlier.
People put off purchases a year ago in hopes of a price decline, but have since decided to pursue New York mortgage deals, said Donald Scanlon, president of the local multiple listing service.
“A year ago, I think there was a doom and gloom that may have been painted by some of the media saying, ‘Prices are coming down. Prices are going to come down. There’s a bubble. It’s going to burst. The bubble is going to burst.’ And I don’t think there was any bubble to burst,” Scanlon said.
He said good signs abound: The number of contracts signed has increased, prices are steady, inventory has declined a bit during the past six months and attendance at open houses is up.
“With those four factors, all the signs are that we’re going to have a very, very strong market,” Scanlon said.
Pearl Kamer, chief economist for the Long Island Association, also said the figures show better news than expected, noting that the Long Island housing market price declines were modest and were confined to Nassau, far from big declines some housing market watchers had predicted.
“There was a lot of concern that there might be a sharp break in the market and that we might see a substantial and abrupt decline in New York home prices, and we haven’t seen it,” Kamer said.
Nevertheless, Kamer foresees price declines - not in the lower- and mid-priced homes, but in some high-priced homes where there’s more leeway to drop, and where mortgage loan costs aren’t a factor.
“I think we’re still at the beginning of the down market,” she said. “And I think we’ll see gradual declines this year and possibly even into next year before the market stabilizes.”
Dianne Clark, owner-broker of Clark Realty Corp. of New York, based in Freeport, said it’s increasingly common to sell homes at prices prevalent two years ago.
“That’s what you have to do,” Clark said. “You have to do that. If people price them unreasonably, nothing’s going to happen.”
A Freeport homeowner eager to move lowered the asking price every two weeks when it wasn’t luring interested buyers. The small two-bedroom home in Freeport sold last month for $315,000 - $50,000 less than the original listing price in 2006.
The 2,500 home closings last month - up 6.7 percent from a year earlier - didn’t reach 2,588, the number of contract signings. But the number of contracts signed represents a more recent gauge of the market, as closings could have gone into contract months earlier.
The median contract price for the three counties was $440,000, the same as a year earlier. Queens experienced an increase, hitting a price of $490,000, up 7.5 percent from a year earlier. Suffolk’s median closing price of $390,000 and Nassau’s $469,000 both fell from a year earlier, down 2.5 percent and 1.3 percent, respectively.
The number of available listings hit 25,000, up 6.6 percent from one year earlier. Meanwhile, inventory in Queens dropped to 6,465, down 7.1 percent from a year ago. Suffolk’s listings rose to 11,112, up 13.1 percent from a year earlier, while Nassau’s listings rose 8.3 percent to 7,440.
MEDIAN PRICES - JANUARY 2007
Queens County: $485,500
Nassau County: $450,000
Suffolk County: $397,600
SOURCE: Newsday
Posted by Richard Barber on Feb 15 2007 under New York
For the first time in six months, the Rochester, N.Y., real estate market saw an increase in existing home sales, which were up nearly 11 percent in January compared with the same month last year.
According to statistics compiled by the Greater Rochester Association of Realtors, reported by the Rochester Democrat & Chronicle, show that the worst days of the housing market may be slowly fading away.
Low New York mortgage rates, a warmer first half of the winter season and a general optimism about the local real estate climate are helping reverse a downward trend, area real estate professionals said.
“Rochester seems to be a pretty steady market,” said John Antetomaso, president of the Greater Rochester Association of Realtors.
The market hiccupped a bit late last year, but buyers have come back with a vengeance after realizing much of what is happening with home prices in the South and West isn’t happening in Rochester.
There were 840 closings during the month, compared with 759 in January of last year. New contracts for the month were up by 5 percent, with 781 home purchase loan contracts accepted compared with 744 during the same period last year. Contracts are an indicator of a market’s direction.
Home closings were down 14.1 percent in December. Homes under contract in the month of January typically do not close until March. The median home price was up 2.6 percent at $117,000 versus $114,000 last year.
Buyers are a little more cautious than they were 2-3 years ago, but “new home buyers are willing to buy if there’s value,” said John Arquette, general manager of Nothnagle Realtors, which has 570 agents in the region.
That means homes for sale should be in good repair and priced to sell, as interest in homes has spiked recently, with inquiries about homes up 25 percent and visits to Nothnagle’s website up 20 percent.
“We may be headed to the market we had 24 months ago,” he said. “We sensed things were starting to change.”
While the market is not as hot as it was a few years ago, the Upstate New York market balance is about equal between buyers and sellers, with a slight edge currently for sellers.
Home sales began to decline in July after five years of strong sales in the region, even as the cost of mortgage loans remained relatively steady.
Rome Celli, broker Realtor at ReMax First in Brighton and Greece, is seeing a flurry of activity on the properties he had listed for sale in January, including multiple offers on a home in the Park Avenue area of Rochester in the $160,000 range.
But the intensity of the pace is not quite at the level it was two years ago, when sellers were in the driver’s seat, Celli said. While home sales are still strong, the asking price range is not as firm.
“What we have is a market in transition,” Celli said. “We have to assume trends that were there last year will still be around.”
SOURCE: Rochester Democrat & Chronicle
Posted by Richard Barber on Feb 14 2007 under New York
The year of 2006 ended on a note of mixed message in the Empire State.
Bad signs included a decline in sales within the Albany housing market, along with an overall drop in existing-home sales and prices across all of New York state in Decembe.
However, when the housing smoke cleared for the year, sales posted their third-highest level on record, according to preliminary data accumulated by the New York State Association of Realtors.
There were 7,462 existing single-family home sales recorded in December, down 19.2 percent from the 9,238 sales in December 2005. The statewide median home price lost 14.2 percent during that period, falling from $265,000 to $227,500.
The steepest declines in sales for December occurred in the Long Island housing market, where Nassau County’s 559 sales represented a 38.6 percent decrease from 910 sales a year earlier and Suffolk County’s sales tumbled 41 percent to 674.
For the year, a total of 101,131 existing single-family sales changed hands, down 6.3 percent from 2005’s record-setting total of 107,909. But there was still strong New York mortgage demand compared to years past.
The 2006 statewide annual median selling price of $248,500 represents a 2.8 percent decrease from the 2005 statewide median of $255,675. This is the third time the annual median has surpassed the $200,000-mark since NYSAR began tracking data in the 1980s.
“Clearly, there was no ‘bursting bubble‘ in the New York housing market in 2006,” said Charles M. Staro, NYSAR chief executive officer. “The market stabilized as expected in 2006 with a slowdown in sales price and a return to balance between buyers and sellers. As evidenced by the third-highest sales total on record, the New York housing market is healthy and we expect it to remain so as we proceed through 2007.”
That’s good news for you whether you’re a buyer, seller or home loan lender in the region.
Posted by Jed Moss on Feb 02 2007 under New York
The number of single-family homes sold by real estate agents in the Albany housing market fell 1 percent in 2006, the first time in nine years there was a year-over-year decline in total sales.
A total of 10,387 homes sold through the Capital Region Multiple Listing Service last year, which covers Albany, Montgomery, Rensselaer, Saratoga, Schenectady and Schoharie counties.
The 1 percent drop was the first time sales fell on a year-over-year basis since 1997, when a similar 1 percent decline occurred.
Even with the decline, the association described 2006 as a strong year for the New York mortgage market because the number of sales was the second-highest total since the trade association began compiling regional sales data in 1988.
Association officials also said the decline was smaller than the 6 percent drop it had anticipated entering the year due to a slowdown in the national housing market.
Officials also noted the average and median prices increased 4 percent and 5 percent, respectively. This could explain why hopeful buyers in the region are priced out at the moment.
The average price was $220,020.
Although prices increased, the pace has slowed considerably compared to the hot market from 2003 to 2005, when appreciation rates were 12 percent to 14 percent annually - and borrowers were still applying for local mortgage loans.
“Projections for 2007 nationally are for the housing market to recover from its 2006 dip,” said James Ader, chief executive officer. “But the Capital Region did not experience that same dip. So we expect sales to continue to be strong and appreciation to match that of 2006.”
The National Association of Realtors reported Jan. 25 that 6.48 million existing homes sold last year, an 8.4 percent drop from 2005, when a record 7 million existing homes sold. The median price for all types of single-family homes nationally was $222,000, a 1.1 percent increase over 2005.
Posted by Jed Moss on Jan 30 2007 under New York
In 2000, 60 percent of homes sold on Long Island, N.Y., could be classified as “affordable housing” for families earning up to $100,000 a year, using the old rule that buyers should spend no more than 2.5 times their income on places to live.
Last year, according to the New York Times, just 2 percent of the houses sold on Long Island were in that range for families with such earnings, which make up more than 60 percent of Long Island households.
The staggering drop over six years, according to the Long Island Index, an annual study of economic and social trends, is the result of low income growth and soaring housing costs, among other factors that have made the area increasingly unaffordable as the median debt-to-income ratio soars.
“It took our breath away, that the change has been so dramatic in such a short period of time,” said Ann Golob, director of the study, which is scheduled for official release Friday. “The image of our region as a wealthy suburb is far from reality for many Long Islanders who are struggling to keep up with high and rising costs.”
Although home prices have retreated in recent months, they remain at near-record levels, a bonanza for many homeowners, at least on paper. Those already living here are insulated from the entry barrier of high prices first-time new home buyers would face.
As the nation’s first post-World War II suburbs, Long Island flourished for decades as a middle-income alternative to New York City and is now home to nearly three million people.
Factors contributing to the exorbitant New York mortgage costs in the area include the loss of higher-paying jobs and growth of lower-paying ones. A decade ago, wages here exceeded the national average by 16 percent; that has shrunk to 5 percent, and average pay has stagnated since 2003.
“Now our income advantage is disappearing, pushing some families near the breaking point,” the report says.
In the report’s survey of 808 residents, 58 percent complained of a tough time paying their monthly home loan payments and other bills, while 54 percent said they were thinking of abandoning Long Island for lower-cost areas. Still, 82 percent called Long Island a good or excellent place to live, but only 48 percent say it’s on the right track.
“Taken as a whole, Long Island’s story has been a success story,” says the report. “But our continued success is now in doubt. We face significant problems, which yearly grow worse.”
In a competitive economy, the report warned, the Long Island real estate market will lose out to other areas unless business and affordable housing expand and taxes decline.
“In an era of easy mobility, a region defers change at its peril,” it said.
The 2.5-times-income formula for prices is often ignored in places like the New York metro area, California and South Florida, where many are forced to spend disproportionately for shelter and shortchange other parts of their budget compared to other parts of the country.
The report did not adjust housing prices for changing mortgage rates, which were about two percentage points higher in 2000. But Golob noted that home owners who bought then were able to cut carrying costs via home mortgage refinancing as rates fell.
Beyond home prices and mortgage rates, an additional factor in the cost of housing is property taxes. They are notoriously high on Long Island and have jumped faster than inflation, the report said.
Many residents are under financial stress because of scant income growth, up by 2 percent on average since 2000. Meanwhile, they are squeezed by the rising costs of property taxes, heating, electricity and gasoline. Even families with incomes above $110,000 report difficulty in paying bills.
“People love their hometown of Long Island — they just can’t afford it any more,” the Nassau County executive, Thomas R. Suozzi, said in response to the report. “We remodeled the Levitt houses, and now we have to remodel the suburban paradigm.”
Posted by Richard Barber on Jan 26 2007 under New York
No region is immune to a slump.
To wit: The once-bulletproof Manhattan housing market suffered a minor setback during the fourth quarter of 2006, according to the latest figures from two of the leading New York City real estate brokers.
The Corcoran Group and Prudential Douglas Elliman both reported that home sellers had rung up slightly lower prices compared with the third quarter of 2006.
The cost of owning a piece of Manhattan has gotten a little more reasonable lately, reports CNN Money.
The median apartment price was $799,000, according to figures from both brokers. Corcoran reported that was down 6 percent from the previous quarter and Elliman had it off 5.5 percent.
“Right now, prices are weakening across the board,” says Jonathan Miller of Miller Samuel, the real estate appraisal firm that compiles the statistics for Elliman. “Each segment showed negative numbers from the previous quarter.”
Inside Manhattan Home Prices
The good news is that prices are still up for the year, 5.5 percent according to Elliman and 11 percent according to Corcoran.
Even the quarter-to-quarter downturn can be interpreted as good news. Miller says prices nearly always slip in the fourth quarter, traditionally the slowest season for those seeking a New York mortgage.
Part of the reason is that the third-quarter reports include many sales made originally during the spring buying season, the hottest time to buy.
Fourth-quarter sales, conversely, cover many of the sales negotiated during the summer months, when markets are slower. In any event, the mortgage brokers themselves seem unruffled by the downturn.
“I’m very pleased with the market,” says Dottie Herman, Elliman’s CEO. “I talk to industry colleagues around the country and they can’t believe what’s happening in New York City.”
Indeed, another broker, Brown Harris Stevens, reported that median Manhattan prices set a new record for the company. Their median price was $760,000 for a condo or co-op apartment - a slight bump over second quarter 2006 and 9 percent higher than the fourth quarter of 2005.
The numbers do indicate that the Manhattan market is much more balanced than it had been a year or two ago, when prices were still sizzling and bidding wars were common. At that point, people were worrying that they’d never find anything to buy, according to Herman.
Looming Inventory
If any factor has the potential to have a significant negative impact on the Manhattan market, it is the bevy of new buildings going up. The years of spectacular price growth encouraged a spike in co-op conversions and a building boom.
Many new developments came on line this year, but not nearly enough to send housing prices tumbling or inventories soaring, according to Pam Liebman, CEO of Corcoran. She reports inventories rose slightly from last year but fell from their levels earlier in 2006.
“The absorption rate [of new apartments] has been very strong,” says Liebman. “And there are a ton of new buildings going up.”
She adds that some planned new buildings will go away. The slowing market has caused many builders to delay projects or convert them to hotels, rentals, even office space. But even the reduced number of new building could dampen price growth.
“Not all the new development will be absorbed immediately,” says Miller. “That will mean the market will move sideways for a while.”
“New development has been a concern for the past year or two,” says Greg Heyms, chief economist for Brown Harris Stevens. “But clearly, the market is not saturated yet. Demand continues to grow.”
Posted by Jed Moss on Jan 03 2007 under New York
