People who are following the Long Island real estate market and my updates were probably not surprised by the latest story in the news about the latest housing numbers. The doom and gloom of the media, playing on peoples emotional strings for the purposes of trying to stir up ratings only helps people make poor decisions.

The tax credit during the spring, which is historically, the best time for real estate in that many buyers are buying and sellers are selling. July and August are both months where the real estate market, in normal conditions, slows down. It’s summer. People are out at the beach, not in hot open houses. Are there people buying - of course, but generally speaking, the summer is slower than Spring.

So the freak out that the media is trying to cause had no effect on me emotionally because I knew that sales would slow down. Anyone who’s following the real estate market knows this.

Now the “bad news”. Yes, prices will continue to soften because of the amount of inventory on the market. That’s a fact. Employment is high and there are many people who are still afraid to buy…just about anything. But demand will slowly increase (as it usually does during the fall and then just after the holidays).

Interest rates are at historic lows and prices are very good across the board for any type of buyer, especially first-time and move-up buyers. For the homeowner who wants to sell and “move up” to a newer home or larger home, with rates so low, even if you drop your price, you’re most likely going to be buying on the other side, at a great price as well.

These latest real estate numbers really mean very little in the larger picture. They were expected.

It is expected that about 5 million homes will sell in the next 12 months (conservative industry standard). Now the challenge is, there will be double that amount in available inventory. So which ones will sell?

The homes that will sell will be the homes with compelling prices. This means, when buyers see your home, it needs to look its best and have a price tag that makes them stop and say, “OMG, I’ve gotta have this house”. If you’re not there in that price area, then you’re home will not sell.

I hear many people say that it’s not a good time to sell. Well, they’re half right. Of course it’s not a good time to sell in the overall grand scheme of things. Yes, 2005 was the best time to sell. But that’s crying over spilled milk. Now is also a good time to sell because rates are low (more buyers can afford more to spend) and prices on the other side (when you’re buying) are low as well! Even if you’re not buying after you sell your home, think about my last article on the market and the decline of prices over the next 12 months or so. Do you want to lose another 5% to 8%? Selling now is better than selling later.

The sky is not falling and if you want to sell your home, you will be able to sell and move on with your life. You’ll just be better off financially doing it sooner than later.

If you want to discuss the value of your home and how I can assist you, please call me at (631)831-9048.

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Did you ever watch the news and wonder if you’re getting the full story? These days, I’m wondering if I want the whole story! But when it comes to relying on the main stream media, one things for sure, you’ve got to really look beyond the headline to get the full story.

Below is a slide with headlines about the market from June of this year. You’ll notice that Case-Schiller, Core Logic and RPX all had positive things to say about the real estate market, but those positives are not the full story.

What I continually talk about here locally on Long Island are the amount of homes for sale and what is actually selling in a given month. In my previous article, the May 2010 update, the numbers tell the story.

The Case-Schiller Future Price Index is a powerful tool for any homeowner who wants information about the market. The future of the real estate market is of course speculative, but the numbers these experts look at tell the story. And the inventory of homes for sale is still very high. When a homeowner talks to me about their opinion of when the real estate market is going to bounce back, I consistently refer to this diagram.

Now if you’re not a numbers person,you’re probably looking at this slide and saying, “What does all this mumbo-jumbo mean?” I hear you! But honestly, in looking at that diagram, you’ve got to pay attention to the fact that while the prices look to go back up after November 2011, they don’t go back up to 2005 levels…they go back to what prices are today!

So what does this mean? It means to me, that if I were really wanting or needing to sell my home, waiting around isn’t going to make things any better in terms of what I will get for the home if I sell it today. And if I wait, my goodness, in 2013, I’ll be getting the same price I would get if I sold it today! That’s important to consider…in my opinion.

Lastly, while I’m not one to base all my decision-making on what some economists say, I will at the least listen to what they think. After all, when you want to make an informed decision, you listen to the experts. This last slide shows that 56% of 106 of the best economists and analysts think the real estate market is going to decline further.

If you have any questions about the real estate market, please feel free to visit my fan page below. Additionally, you may call me for a private consultation at (631)831-9048.

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The Long Island real estate market in May 2010 numbers are out and I am still waiting on June numbers to be released. With all the commentary about what happened to prices in the market, I think many homeowners are confused as to where the market is and where it is going.

For the purposes of this article, I’m going to look at one thing that tells the story of the entire market. It’s not prices per se, but inventory. I’m going to give you a statistic here that’s kind of scary if you understand it and appreciate it.

The standard of keeping track of statistics mostly centers around comparing one month or quarter to the years previous. So for instance, I’m going to give you May 2009 numbers of homes available vs. homes sold and then I’ll give you May 2010 numbers.

May 2009

Now I’ll provide May 2010 numbers for homes sold vs. homes available.

Now from these two time periods you’ll see that the only major difference is the homes sold were higher in May 2010. The available homes (inventory) appears to be just about the same with some slight variation.

But the real key to stat to look at is, if we just go back three months to February 2010.

Here we see some major changes to the market. Over 12,000 homes were added to the available market from February to May of 2010. That’s a gigantic leap of more than 25%.

That means, in general, in your area, if you had your home on the market in February and didn’t sell it and were still on the market in May, if there were 75 homes for sale in your area in February, there were nearly 100 homes for sale by May. Thus you were competing against 25 new homes for sale in your area. This gives buyers more options and when supply exceeds demand (as it does in all of these slides - there’s a lot less homes being bought then are listed for sale) that means one thing - prices must adjust downward!

This is the reality of our market. I continually go back to this statistic because it tells the story of what exactly is going on in the Long Island real estate market. Prices of SOLD HOMES may have risen during the month of May, as it was reported, but that could be attributed to many factors such as maybe the high end market sold more, thus throwing off the numbers (which is what many local experts are saying).

One thing is for sure, unfortunately for sellers, home values on Long Island are not going up. They are stagnant or declining slightly. One reason for the prices not dropping more rapidly has to do with the low mortgage interest rates.

It takes unique marketing strategies and cutting edge technology to sell homes in this market. That along with current and valuable real estate analysis will go a long way toward helping you sell your home in this very challenging market.

If you want expert analysis of your home’s value and want to discuss my comprehensive online marketing plans, please contact me at 631-831-9048.

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I recently had a conversation with a potential buyer who asked me if now was a good time to buy a home. I sighed and proceeded to review with him the current real estate market conditions and the basic formula for wise investment.

Do you know the basic principle of investing? I’m sure you do if you stop and think about it.

Okay so it’s Buy low, sell high. Great. Easy four word phrase: Buy low, sell high. So let’s see, the Long Island real estate market is down nearly 40% from peak. Is that low enough?

Forget about that for one second and take this into account; the mortgage interest rate is under 5%…still! It’s like this gigantic carrot hanging out there, but potential buyers aren’t reaching for it and if they are, somewhere in the back of their heads, they’re thinking (or perhaps you’re thinking) not yet. It’s still not a good enough time to buy.

Take this theory into account:

What goes down, will eventually go up. When something hits the bottom, it normally doesn’t stay there indefinitely. The mortgage interest rate has no where left to go. It can’t go any lower.

But it could jump up one whole point in less than a month. Right now the rate is low.

I just helped a client buy his first home. He and his family will benefit from a low 4.875% rate for as long as they live in their home, up to 30 years. Think about that for a second. He will be able to deduct his mortgage interest from his taxes and he will benefit from the investment of real estate in a down market where he took the plunge and in his words, “…did the best thing for my family.”

The combination of my professional services and his willingness to listen and follow the my instructions of capitalizing on the mortgage interest rates of our lifetimes, has him in a new home at a great price and a mortgage payment that he can afford.

One of the greatest things to consider from this market is your buying power. Not every agent is going to cover this in their discussions with buyers, but I make sure I cover it with all of them. With rates so low, it’s always wise to remember that your dollar goes a lot further when rates are low. So instead of being able to buy a 3 bedroom/1 bath home, you can probably afford 4 bedrooms, 2 baths and a full basement with a garage!

If you’ve got questions about the rates and about homes for sale and how I can help you make the dream of home ownership a reality, call me today (631)831-9048.

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Everyone is wondering what to expect Long Island home values to do in the next year or two. With misleading headlines in May, leading people to think that prices are increasing and the market is bouncing back, I think many homeowners are going to be very disappointed.

First I want to say this, this is not a doom and gloom article about what’s going to happen to the market. This is information from leading experts and sources that look beyond the headline. It’s information for homeowners to view so they can be educated about what’s happening to Long Island home values.

I’d like to start by saying, from my own personal experience during the last few months, things were very “hot” during the months of April and May. From my phone logs and email contacts and showing activity on my listings, June had a cooling effect where activity from buyers seemed to decline. The June numbers will be out soon and I will be posting them here when they come out.

Here’s what the experts are saying about home values in general. First, this website link - http://www.npr.org/templates/story/story.php?storyId=111494514 - will take you to information broken down by county on foreclosures. Nassau and Suffolk counties are among the highest in the nation for foreclosure and distressed property activity. And remember, foreclosures bring down home values. So this is really point one, Long Island home values will suffer a drag from increased foreclosure and distressed property sales.

This next slide is from Case/Schiller and gives us a look at overall future home prices.

The dip in values to a bottom in May 2011 is a projected bottom, but what’s more significant is the time it’s going to take to get back to current values in 2010! By November 2013, according to Case/Schiller (experts in the field of real estate), we will be back to 2010 values…not 2005 values.

One thing this chart doesn’t take into account is mortgage interest rates and how they’ll impact home values. With the rate so low, buyer activity hasn’t fallen off a cliff. And on Long Island, with high taxes and still relatively high home prices, mortgage rates must remain low in order to keep Long Island home values stable.

A very interesting web link to check out is http://www.forbes.com/2010/06/04/migration-moving-wealthy-interactive-counties-map.html?preload=36103. Now we’ve all heard about the “brain drain” from Long Island and if you haven’t, it has to do with the youth on Long Island (people over 18 through 30) leaving Long Island to live in more affordable areas of the country.

When you bring up this link, allow the interactive map to load then click on Long Island. Red lines represent movement from an area and black lines represent movement to an area. What I noticed right away was that there weren’t too many black lines leading to Nassau and Suffolk county, but red lines (moving away) cover the map!

What does this have to do with Long Island home values? If there isn’t a high demand for people to move here, the buyer pool shrinks or remains stagnant. This is, in my opinion, Long Island’s great challenge - to keep people here and to entice more out of towners to move here! Now combine this “brain drain” with increased mortgage interest rates and what you have is a buyer pool that will not be able to purchase homes because they won’t be able to afford them…unless home sellers…drop their prices. This is clearly something home sellers want to avoid.

Housing analysts have recently grown gloomier about the outlook for home prices as sales slump, with a survey released by MacroMarkets LLC finding that 56% of 106 economists and analysts surveyed expecting home prices to decline this year, up from 40% a month ago.

With a growing number of experts in the field calling for further declines in prices, I’m one to say that if you’re thinking of selling your home, further delay may only hurt your chances of capitalizing on what’s left of home values on Long Island. And with mortgage rates so low, buyers are out there looking. They’re just waiting for the right house to buy.

Feel free to call me to schedule an appointment - (631) 831-9048.

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These video’s and slide pictures and graphs below feature information on the shadow inventory and how Long Island home values will be impacted. I hope this information about the real estate market helps you to determine what course of action to take if you’re considering putting your home on the market now.

Part I Shadow Inventory

Part II Shadow Inventory

Bank Foreclosure Shadow Inventory
This slide below reflects how much the banks are holding back. The banks have millions of homes to sell.

I want to point out that every time I talk about foreclosures, there is a story behind that home. If you’re behind on your mortgage, I urge you to contact me so we can discuss your options and as always, if you’ve watched this video and you want to talk about putting your home up for sale or purchasing a home, you can call me immediately at 631-831-9048.

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This is a 3 part video about Long Island home prices. Attention sellers! Stick with the video’s and the slides. I’m taking what experts are saying what the future holds for the real estate market.
Part I

Part II

Part III

My cell phone is 631-831-9048.

By Thomas McGiveron, LSA

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If you are struggling right now with paying your mortgage, you may be wondering what challenges exist when trying to get a short sale done in order to avoid foreclosure. Among many things, you of course may be in disbelief that this is happening to you and you may also be worried about things like where you’re going to live once you have to move out.

All things like this are tough to think about and I have spoken to enough homeowners, young and old, that have poured their feelings out to me over their situation. One thing I want to make clear though is, this challenge in your life is not just going away.

When I meet with homeowners who have lost their home to foreclosure (after the bank has foreclosed and the homeowners become “occupants”, no owners), I always ask them why they didn’t consider a short sale, even as a last resort. Almost all say that they just thought the problem would go away or that somehow, things would change.

When homeowners call me to discuss negotiating a short sale with their lender, I try to be the voice of sound mind. I try to present the facts and stick to them.

One of the facts about negotiating with your lender to sell your home for less than what you owe on the mortgage is, putting the package together. There are many challenges to getting a short sale done. And here’s the thing about that.

It’s tough enough for families to experience the scenario of losing their home. The last thing you want is to hire a real estate agent and an attorney who do not know what they’re doing when it comes to completing a short sale. They may sound very nice and listen very intently. The agent might even offer very kind words of encouragement and offer a warm smile.

Click here to read the rest of the article

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I don’t know about you, but I’m starting to get a little offended at what’s happened to Long Island in the last few years…as a Long Islander of course. I’ve decided to take “the battle” to the streets and created the Long Island Real Estate Market Fan Page on Facebook to start making Long Island great again!

Okay - What’s Facebook?

Now I’m sure if you’re on the internet more than one time in your life, you’ve heard of the website facebook.com. It is the “cleaner” version of myspace.com, and by that I mean, it’s just less advertisements and more connecting with friends, family and more importantly, topics of interest and information.

When I first learned about facebook, I only saw it for one thing, connecting online with…whomever. The more I learn about facebook, the more I see it’s a place to find any kind of information, company, service, product…just anything you can think of. It’s the social “google” if you will.

It’s All About Long Island…

Rather than type into a boring search engine, I can connect locally with a company or a local expert. And that is why I’ve decided to create the Long Island Real Estate Fan Page.

The more I can share with you and vise versa, about this great place to live, the better off we all are, as we educate people on how great it is to live on Long Island (despite high taxes!). And a note about those high taxes, I say it’s like anything else; You get what you pay for! If you want to live where the taxes are $600.00 a year, well then knock yourself out. I did and let me tell you, there’s no comparison! I’d rather pay $6,000 a year or more and live in the best place in the country.

From the climate, to the location to New York City, to the convenience of the ocean and magnificent waterways…Long Island is just a great place to live.

And when this economic “ice age” settles and we survive past 2012 (Nostradamus and Mayans eat your heart out!), Long Island will thrive!

Do we need government officials who believe in spending less and lowering taxes - you better believe it, but let’s get there one fan at a time. I urge you to join me on the Long Island Real Estate Market fan page.

One of the best things about the facebook platform is, the news and information is there when you want it. It’s not like receiving e-newsletters you don’t want or commercials you don’t want to see on Television. If you become a fan and bounce around on there once in a while, for any topic or fan page, it’s so easy and it’s free.

If you’ve read my web articles or gone through my websites, you know that I post pertinent information that can be valuable to the person who’s interested in real estate. That’s what I will be posting on the Long Island Real Estate Market fan page.

I’m also going to be posting things on there from all over the internet. I hope you do as well.

If you’ve got a cause you believe in and it’s local and important, bring it on and share it on Long Island Real Estate Market on facebook.

Again, that’s what’s so powerful about the facebook environment. It’s a community sharing local information from local people.

Now is this a “revolution” on the fan page…Yes it is!

We’ve got to come together and start making it clear that Long Island is better than Tennessee, Georgia, Utah, Colorado, etc. People are leaving here - young people - and we’ve got to help our community grow with youthfulness, not perish with age. That’s what this fan page is all about. I’ve posted the link enough. Just join and let’s start making Long Island great again!
(c) Copyright 2010 www.tommcgiveron.com
By Thomas McGiveron, LSA
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So you’re wondering what’s going to happen to mortgage rates. If you’re a buyer, you’re wondering that because you are trying to figure out how much the cost will rise for your monthly payment. If you’re a seller, you’re thinking about a lot of things and saying to yourself, “I should have sold 3 years ago”. But I digress.

When we look at information available to us, we see that mortgage rates are going to rise and we wonder, how that might impact the Long Island real estate market. Well just like any other market, when rates rise and demand remains lower than supply, prices must drop in order for someone to sell their home.

But let’s really look at the added costs of an increased mortgage rate.

Now this graph is packed with a lot of different information about mortgage rates.

The Impact On Buyers
Well first thing you must realize is that in order for you to buy a home and pay about the same price per month for that home as the rate goes up, you’ll notice that the price of the loan must go down significantly. Let’s say you’ve been looking for a while and you see a few houses or one in particular that you love. But for some reason, you’ve held back for reasons such as…well to put it bluntly, fear.

Let’s face it, this economy has many people a little uneasy about the future. So you hold back for whatever reason, you want to wait until you get married, you need to “save more for the down payment”, prices are still too high, taxes are too much, the dining room is too small, and on and on.

Well look at that graph and ask yourself this: Do you honestly believe that this house you’ve seen or these few houses that are “potentials” will be there 10% from now? What I’m saying you to ask yourself is, will this same house or houses be on the market for sale 5 months from now when rates are quite possibly 1 full percent higher than they are now? Maybe. But more than likely, if you’ve got your eye on a nice house that you really like or love, chances are so does someone else. And if they’re a little less afraid than you, guess what, they’re buying it.

Another thing for buyers to look at is simply the savings. Paying 6% on a loan as opposed to paying 5% on a mortgage rate is a no brainer. You will save more money. And again, this graph is based on prices dropping as the rate goes up. Just because the rates goes up, doesn’t mean that the home(s) you like has to sell (or can sell for that matter - given the likelihood that they have a mortgage to pay off).

The Impact On Sellers
The cold harsh reality of the market is that prices are going to continue to see-saw in a downward spiral. Every economic and real estate expert out there predict a further decline in prices. Here on Long Island, the simple curve of supply exceeding demand will absolutely keep prices from appreciating for the near future (6 to 18 months).

With the flow of homes off and back on the market and increases in foreclosures, this extra supply, as it comes in waves, will continue to keep prices from going up.

Now this graph adds an element that is not seller-friendly. Historically, a 6% mortgage rate is incredibly good. However, given the current economic situation, decreased consumer spending and high unemployment (currently over 7% on Long Island), a 6% rate might as well be 8 or 9% in a “normal economy”.

Buyers on Long Island, with the high taxes and cost of living that exceeds about 90% of the rest of the country, living here isn’t cheap and many buyers don’t have $80,000 to buy a modestly priced home of $300,000. Remember, the standard, “good loan” for a home is 20% down (on $300,000 that’s $60,000) and the other $20,000 is for the very high closing costs associated with buying on Long Island.

So looking at the graph, as the mortgage rate goes up, if you need to sell, you will absolutely be forced to drop your price as the rate goes up. There is no question about this. Why? Because the buying market won’t have buyers to purchase your home at a 6% mortgage rate at the current prices of today (April 2010). And please note, that I’m not even mentioning the home buyer tax credit that is expiring in 2 weeks that’s helping home values remain somewhat stable. Without that, prices will drop.

But there’s definitely hope in that if you hire the right agent, who uses cutting edge technology to market your home, buyers will check out your home more often than just having it sit idle on mls, overpriced. Oh by the way, that “right agent” - that’s me - click here and let’s get started!

So What About The Mortgage Rate Anyway?

Let’s look at what experts are saying.

From Moody’s Economy.com to Credit Suisse to Barclay’s Capital, we see that the experts are predicting increased mortgage rates. Why? Read my article on what’s happened in the last month with the Fed.

National speaker and residential real estate guru, Steve Harney, talks about how since 2006, April to July months have seen mortgage rate volatility.

So to close this discussion out, I think it’s particularly important for buyers and sellers to consider their options. Information like this is invaluable and I hope it helps you make the best decisions for you and your families. If you have any questions at all, I can always be reached at (631)831-9048.

By the way, if you missed the commission discount I’m offering for home sellers, please click here.

(c) Copyright, 2010 www.tommcgiveron.com
By Thomas McGiveron, Licensed Real Estate Salesperson
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