The Heart of the Matter will be a regular feature:
Reflecting on the last six months, I must say, the challenges in our local real estate market have been daunting. I am sure most of you are aware that the government’s $8,000 tax credit for first time home buyers has expired. This took effect on the 30th of April. While this program did help to sell some homes early in the spring, most properties sold while this program was in effect were priced at $325,000 or less, which is what one would expect for families looking to purchase their first home.
In May, the Real Estate market took a turn for the worse, as it seems that we were in a “hangover period.” Many of the spring buyers rushed to get into contract before the April 30th deadline, resulting in very few people looking to purchase in May and June. Also in the spring, many sellers wanted to put their homes on the market. They were all hoping, and rightly so, that the spring market would be the best opportunity for them to sell. So, inventories that were already high became higher. With very few buyers, and many more homes on the market, the chances of selling were low unless homes were priced very aggressively.
Additionally, the economy presents another problem impacting real estate values. With people losing their jobs, high taxes, foreclosures, short sales, and a struggling stock market, further downward pressure has been put on the value of real estate. Many sellers have told me they feel trapped in their homes. Low demand, large mortgage payments, high taxes and cost of living expenses have left many with very few options.
Homeowners in the area have been waiting for the Real Estate market to turn around. July and August (the dog days of summer) are typically very slow, so right now it’s hard to predict what the future holds. As you look at the numbers below I think you will agree that over the past six months the number of homes that have sold in Pawling is disturbingly low.
Here are some statistics from the Westchester Putnam Multiple Listing Service regarding the number of homes currently on the market in Pawling in a given price range, and the number of “solds” in the last six months as of July 23rd:
$200,000 to $300,000 26 Active on the market and 6 Sold
$300,000 to $400,000 31 Active on the market and 8 Sold
$400,000 to $500,000 23 Active on the market and 1 Sold
$500,000 to $600,000 9 Active on the market and 0 Sold
$600,000 to $1,000,000 28 Active on the market and 2 Sold
Now for the good news! If you are lucky enough to be a buyer in this market, you are definitely in the driver’s seat. With varied inventory to choose from and mortgage rates currently at some of the lowest levels in history, buyers certainly have the upper hand. Purchasers also know that sellers are desperate for bids and many of them are submitting lower offers in order to take advantage of current trends. Deals are harder to put together, too. Sellers are upset about lowering the price of their homes and buyers are looking for the best possible price, making it more difficult to make everyone at the negotiating table happy.
As we move into fall, I am hoping that the market will improve. It always does, and I remain optimistic even though it has been a long time since we have all had something to cheer about. Growing up on a farm, I remember that we had good years and bad years. The weather and markets were always unpredictable, just like the current real estate climate…and if that’s the case, we seem to be in the middle of a very long drought.
Todd Kessman works at the Local Prudential Serls office in the Village of Pawling, and has lived in the area his entire life. He has been in the real estate business for the last eight years, and is a full time Associate Broker who loves the challenges and rewards of being a local agent.