Long Island Real Estate Market: The Proof Is In The Pudding

I talk with a lot of homeowners about the Long Island real estate market and I continually hear many people say, “There’s no buyers…” While we could argue that a “buyer” is someone who’s actually ready, willing and able to purchase a home, let’s assume for a moment that a “buyer” is just someone who wants, very badly, to purchase a home.
I recently hosted an open house at a home in Babylon. The home is a ranch, priced very good for the area. I was expecting things to be busy due to the activity on the listing in its first week (4 agent showings each day - over 20 in 5 days). In anticipation, I had my front desk assistant make up extra copies of sign-in sheets and some other items. I normally bring about 25 business cards to my open houses. On this day, I brought a larger stack (about 50).
After the first hour and a half of the open house, I had run out of all my flyers and sign-in sheets, plus I had given out all my business cards. Loads of cars stopped by with many buyers eager to see the home.
Being in this business full-time, I see it every week, when a listing is priced correctly, it sells and sells fast. Of course when I try and tell homeowners this, they don’t really want to believe me. Afterall, I’m just a salesman.
There is a pent up buyer demand, especially now with the mortgage interest rates being so low. This is a fact, proven by my little open house with over 60 buyers.

May

18

The State of The Long Island Real Estate Market: April 2009

Filed Under Buyers, Sellers, Sellers & Buyers | 6 Comments

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I am conducting buyer and seller seminars throughout Long Island and I am continually hearing people tell me what they think about the Long Island real estate market. I hear things like, “Oh, the market’s going to pick back up soon.” I also hear things like, “The market is crashing and all prices are going to go down another 50%…”
It’s usually sellers saying the first thing and buyers saying more of the latter. Obviously.
Now my website is directed entirely towards educating sellers and buyers on the Long Island real estate market. I do not dress up the information and I pull no punches when it comes to taking a good hard look at what’s going on. At least in my opinion, my information is transparent in as much as the information presented is as accurate as I can make it.
To specifically address what has happened to the Long Island real estate market, I decided to take a look at all the zones of Long Island, which includes in this article: Queens, Nassau and Suffolk. I took a look at the most current data available via the Multiple Listing Service Of Long Island. I measured April 2008 and April 2009 respectively. What I found was shocking, even to me.

Long Island is comprised of zones, which cover multiple hamlets. If you have a question about what zone you are in, please call me at 1.877.765.3123, ext. 51 and I’d be glad to review this with you.
These statistics do not lie. When a seller tries to tell me that the market isn’t “as bad” as what I say - I refer to this chart.
I was recently at a friend’s party and his father-in-law was trying to tell me that the average home in Suffolk is selling for $415,000. I promptly told him that information was inaccurate and proceeded to tell him that prices have dropped 17.5% in the last twelve months and the average selling price in Suffolk County is currently around $370,000.
Well, I was the party-pooper. Hey, there’s a first time for everything!
So if you’re buying or selling, please refer to this chart. I will do my best to update it every month, so keep checking back in monthly to see where we’re at. To me, this is a great way to stay on top of where the market is.

So where is the market going? Well, the above slide is pretty clear on that. With over 33,000 listings for sale (inventory) and less than 1500 sales, we have a long way to go toward leveling the supply of homes on the market. This point is irrefutable. These numbers do not lie.
Are there signs that things are improving? Absolutely, but the improvements are slow and small (which is a lot better than nonexistent). Now what does this mean for buyers? It means, for the time being, that home prices will not be increasing anytime soon. However, as I always say, interest rates are at historic lows so getting in now is an incredible time.
If you would like to learn more about one of our seminars or would like to sit and review more market information, please do not hesitate to contact me at 631.831.9048.

May

6

Long Island Short Sales: (Try) To Buy Or Not To Buy

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Throughout Long Island, short sales have become common practice. If you’re reading this article and don’t know what a short sale is, click here for a quick explanation. With the increase in Long Island short sales, I have seen a tremendous surge of buyers looking to purchase a short sale.

So if you’re reading this article and you find yourself asking, to buy or not to buy (a short sale), then this information is for you.
Assuming you know what a short sale is, I’m going to move right to the point, should you buy a short sale? And of course, the simple answer is, it depends. If you’re out looking at homes on your own because you know more about real estate than a professionally licensed salesperson, well best of luck to you. Stop reading and go buy your short sale (little poke at the know-it-alls).

Okay, so we got rid of those people. Now, if you’re out looking on your own because you’re just new to the whole experience of buying a home, then I would say you should not jump in and try and find a “deal” on a short sale. Why? Because you don’t know what you’re doing and you’ll find that you’ll waste a lot of time and ultimately become frustrated by your lack of progress.

If you’re working with a buyer’s agent because you’ve come to understand that maybe you need a little help, I would say go forth with caution when considering a short sale.
At the end of the day, there are several factors to consider when buying a short sale. One major characteristic is time. Interest rates will remain as historically low as they are now, for only so long and a short sale takes longer to close because it’s a much more complex transaction. Several factors like seller cooperation, and listing agent and attorney competence play tremendous roles in the successability of a short sale.

For me, it’s relatively easy to determine whether a short sale is worth an offer or not and it has nothing to do with whether or not a listing agent says a short sale asking price is “approved” or not. In fact, I shy away from short sale listings where an agent has an “approved” amount. It means nothing.

I ask four to five simple questions to a listing agent of a short sale to determine if it’s a go or not. Unfortunately for you the reader, I’m not just going to put those questions in this article. You’ll have to call me at 631.831.9048 and discuss hiring me as your agent if you’re serious about buying a short sale (I’m a Licensed Real Estate Salesperson so there are no fees other than my commission which is paid by the seller at closing).

Since I’m a nice guy, I will disclose one question I ask every listing agent who has a short sale to sell. I ask them, “How will the offer be presented to the bank if accepted by the sellers?”

What does this mean to you the reader? Nothing. But it is an extremely simple and effective question for me to ask because the answer will almost definitely let me know whether or not it’s good to try to buy or not to buy.

While I was writing this article, the phrase “To buy or not to buy” seemed lacking because you don’t simply buy a short sale. A buyer tries to buy a home via a short sale. Earlier, I mentioned factors that may help or hurt the chances of a successful short sale. There, I didn’t mention the bank or banks that hold the mortgage on a particular home. Some banks are so ill-equipped to handle what is happening in this real estate industry that they simply take a long time (3 to 6 months) to actually review the short sale deal.

Do you know what banks these are?
I do.

Again, when you’re considering buying a short sale, keep in mind that if you don’t know what you’re doing, chances are you will continually be frustrated to find a lack of progress being made with regard to your offer.

Now I want to comment on whether or not a short sale is a “deal” or not. For the record, I can say that in most cases, you will be paying fair market value for a short sale. Let me repeat, in most cases, prepare to pay fair market value. What is “fair market value” (FMV)? It is not what necessarily what the asking price is. Trust me on that. FMV is simply: What like-kind homes in the same area with the same features have sold for within the previous 90 to 180 days. Period.
With a listingbook account from me, I provide all my buyers the ability to establish FMV and together, we make offers that count. Regardless of the listing agent, my offers get accepted, go to the bank (that’s key) and my buyer clients close.

So if you’re out there to “get a deal”, I can say that you almost certainly will not pay more than FMV for a short sale. If you’re serious about buying a short sale (or foreclosure), please call me and let me help you do it right - 631.831.9048.

May

3

Long Island Real Estate Market: Buyer Fear Is Market’s Greatest Challenge

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“The Long Island Real Estate Market Scares Man to Death!” I can see the story newsline now! A friend of mine wants to buy a home. He earns a very good salary but at the end of the day, he’s scared to death of…just about everything, from losing his job to his wife not ever finding employment.
Now while the past few months have been extremely busy for many real estate agents (contrary to common belief), many of us talk amongst ourselves and we are still seeing many buyers on the fence. There is indeed a huge pent up demand out there waiting to strike.
The only problem is, they’re scared.
Like my friend, buyers today are just unsure about the market, employment, and the world in general. As a therapist, an obstacle to someone moving forward in their lives, by changing what they do and how they manage their lives, is called an impasse. An impasse is the fear of the unknown - the fear of what may occur if changes take place that alter how one deals with their lives. Take for instance, a woman who stays with an abusive husband (or vise versa). From the outside, we judge that situation and say, “Why doesn’t she just leave him?”
Impasse.
Buyers right now, are the “abused” spouses…so to speak. They’re used to landlords taking their money and feel more comfortable with this current situation - they know what to expect.
Until fear is replaced with some form of confidence in the market and job security, I firmly believe that 5 in 10 qualified buyers will remain on the sidelines, watching…waiting.

This image is where buyers are right now. With mortgage interest rates so low, buys are riding a see-saw or sorts. Trying to balance out the perfect time to buy. One thing is for sure, and it’s that right now, interest rates are at an all-time low and I’ve written extensively on mortgage interest rates.
Even with a fantastic 1st time home buyer tax credit (dollar for dollar credit - ask your cpa), many buyers are still not pulling the trigger.
But…more are starting to and this means, that as a buyer, the homes that are prime buys, could be all dried up by the time the most fearful come around and start to get involved. What’s now on the market, if it’s a “good” buy, will be long gone six months from now.

The greatest challenge for people facing an impasse is moving forward when every part of their body and mind is telling them to pull back. Hopefully, if you’re reading this and you want to buy, you’ll consider signing up for a listingbook account to at least find out what’s out there.