Long Island Real Estate Market – Information for Sellers and Buyers
For sellers:
“Home prices may fall 25 to 30 percent from their peak in 2006 and not bottom out until 2010, with even greater declines in subprime mortgage debt markets.” – Peter Acciavatti, credit analyst and CEO of JP Morgan Securities Inc Source: Reuters 6/11/08
“Home prices, according to S&P/Case-Shiller data, have fallen about 15 percent and I expect them to fall another 10 percent before bottoming out in the spring of 2009.” – Mark Zandi, chief economist at Moody’s Economy.com Source: Reuters News 6/26/08
What these two quotes tell me about the Long Island real estate market is that if you’re in a position where you really need to sell, you’re better off putting it on the market now, rather than waiting until next year. or even the following year.
I’m all for people not selling their houses now. Actually! You can think and ask: “Yeah, sure, how would I earn money?”. The truth is that people will always need to sell and there will always be people looking to buy. If fewer people put their houses on the market, that would be a good thing, but only in large numbers. Supply and demand dictate the pace of the market. When there is an oversupply, the more dramatic it becomes, the more prices will fall. So really in that scenario, I as a real estate agent will do well in the business whether the houses are priced high or low.
If the Long Island real estate market were to get rid of about 50% of the homes that are currently for sale (about 17,000 homes) this would dramatically improve and stabilize prices downward and again as a real estate agent real estate, it would be good for me because this would help even the supply and demand would increase (more buyers).
However, I really don’t like being in a position where I’m working with someone (seller) who is frustrated and dissatisfied with the “market feedback” results. Market feedback is what buyers tell you, simply by their actions. If their actions are to avoid your home and not see it, either by themselves or with another agent, this says one thing loud and clear: “The price is too high.” You can also point to the fact that the home:
A. It is not well photographed.
B. It is outdated or needs updating in key areas of the home.
C. It is disordered in the images (see A).
D. It is not different from other houses.
E. Does not advertise entirely or in high-traffic areas (ie the Internet, and not just MLS).
F. It lacks a real estate agent who correctly manages the listing.
Now, of course, some of these items are outside the general responsibilities of the real estate agent (to a certain extent). Sellers must be willing to do “their part” to increase the saleability of the property.
Market feedback may also tell you that the home has all the “goods” (ie, move-in condition, up-to-date, etc.), but the price is too high. How is that? Simple. There are no offers. Many no-offer showings should tell an agent that the price is too high and all it takes is a slight price adjustment and remarketing of the property to get buyers to the table. Now I emphasize the word “should” because it is not a foregone conclusion that all agents will listen to the market talk to them.
Homeowners who work with real estate agents like to focus on the “lack of marketing” of their respective real estate agents. And I will definitely say that in some cases they are right. But most of the time, especially in this market, it has little to nothing to do with the marketing of the property. Why would I say this?
There are approximately 34,000 homes for sale in Queens, Suffolk and Nassau counties.
Now, hiring an agent who works full time, and therefore has a vested interest in selling your house because you have food on your table, is probably a good idea. But here’s a tip for prospective sellers: use google.com. Look up the name of the agents you are interviewing. See how involved they are in the field. If they are not involved… chances are they are not an entity in business. Selling real estate is a business. It’s not about who is the nicest person (although that goes a long way) or who has a good recipe for chocolate chip cookies (although they are yummy). It’s all about who sells real estate. Who is it apart from the 7% of agents that do 93% of the business? See Teammusso.
For buyers:
Now, with interest rates rising, buyers may want to get out and play or risk being locked out of the market for years to come. I wrote about the effects of higher interest rates on monthly payments and total interest paid on a mortgage. The effects are beginning.
Now, more than ever, it is advisable for any buyer to consider working with a buyer’s agent like myself. Why pay 3% of your closing money to an agent who works for the seller? That makes no sense. I specialize in Buyer Representation. It’s one of the reasons I use cutting edge technology to help my buyer clients achieve their dream of home ownership.
I look forward to doing business with you!
