Sullivan County Real Estate

Nov. Existing Home Sales Data Points to Market Upturn

The National Association of Realtors just released the national and regional existing home sales data for November 2006. (Get .pdf here) The data, particularly for the northeast region, looks pretty good. The seasonally adjusted annual rate of sales rose 6.0% in November over October. The median sales price in the Northeast reversed its downward trend, pushing up 5% over October, and measuring just 2.2% below November 2005. The $269,000 median sales price in November was 7% below the peak reached in June, but just a hair below the $271,300 recorded for all of 2005. The data seems to support a prediction that I've been making for the last few months that the market will probably stabilize around 2005 levels (which was still a very good year), erasing some of the peaks earlier this year but unlikely to retreat further to 2005 levels. Of course, I don't have a crytal ball, and there are an awful lot of macro-economic factors that can impact real estate. Notably, if mortgage interest rates rise substantially that will have a direct impact on housing affordability and could translate into a slide in prices.

Merry Christmas and Happy Holidays - And the Dawn of a New Year

I'd like to extend my heartfelt thanks to everyone who has made this blog such a vibrant forum about Sullivan County. Its been exciting to see participation grow throughout the year, and the heartfelt opinions and emotions expressed here.

I feel that 2007 is going to be a great year for Sullivan County, and a tipping point in our redevelopment. All signs are pointing towards final approval for a casino at the Monticello Raceway early in the year, which could lead to shovels in the ground as early as next summer. Whether you're pro or anti-casino, its a huge step for the county. Final approval for Capelli's ambitious redevelopment of the Concord is also expected in the first quarter, with construction also expected to start by summer. Expectations are running high that Capelli will also announce that the first phase spa hotel will carry the Ritz Carlton name.

Hopefully the dam repair at Swinging Bridge, the jewel of Sullivan County's lakes, will be finished and the lake will be refilled by summer. We'e been without Swinging Bridge for two seasons now, and its a huge recreational draw.

Bethel Woods will be hosting its second season, and we're all eagerly awaiting the lineup. Rumors have been swirling around here for months about some major announcements from Bethel Woods in the New Year. We'll just have to wait and see. If both the casino and the new Concord break ground, that could be the impetus for the Gerry Foundation to roll out Phase II for Bethel Woods.

On a less high profile and glamorous note, government officials are working together to solve the flooding issues that have affected many parts of Sullivan County. 2007 could finally see a comprehensive plan to deal with our rivers and that could be a real boon to our northern hamlets, Roscoe and Livingston Manor.

2007 could also be the year we start taking land use planning and conservation seriously. This year many of our townships were broadsided by dozens of development proposals, many of which technically fit within outdated planning rules originally designed for minor subdivisions or cutting off a piece of land here and there. Throughout the county, townships are reviewing comprehensive plans and are starting to look at more progressive approaches to land use and development.

In 2007, hopefully the death knell will be sounded for the NYRI (New York Regional Interconnect) powerline project. The spectre of this project is casting a dark shadow over wide swaths of land in the western part of the county, and it needs to be put to rest once and for all.

On the real estate side, I hope we can settle down into a predictable market early in 2007. The last 6 months of 2006 have been marked by uncertainty and caution on the buyer side, and continuing La-La land unreality on the seller side. Market transitions are always tough, as buyers and sellers adjust to new dynamics, and the last 6 months have been no exception.

Overall, I'm very optimistic for 2007 and think it will be a very happy New Year for Sullivan County.

Merry Christmas, Happy Holidays and a Happy New Year to all.

Casino Gets Interior Dept. Nod

The NY Times reported today that the U.S. Dept. of the Interior has approced the environmental plan for the Mohawk / Empire Resorts casino at the Monticello Raceway. (Story) The approval was a major hurdle for the $600 million project, and moves the casino one big step closer to reality. Gov. Pataki is expected to issue his concurrence with the finding before he leaves office. There is one more major step before construction can actually begin, and that's for the Mohawks and New York State to amend their compact and revenue sharing agreements. That task will fall to incoming governor Elliot Spitzer, who is also a supporter of casinos in the Catskills.

Hey, Folks, We're Not Long Island

Lately, whenever I talk to a prospective buyer from Long Island, they inevitably comment that the real estate market on Long Island is in the pits, that houses aren't selling and that prices are going down, down, down. And they extrapolate that all real estate markets are the same, and that the same dynamics affecting Long Island are also in play here in the Catskills.

I'd venture, though, that many people there --- as well as here, to be honest --- base their view on anecdotal reports and glances at sensational news headlines that trumpet the collapse of the real estate world as we know it! Regionally, the data just doesn't support a real estate collapse. Even in suburban areas around NYC, sale prices have only dropped a few percentage points from their peaks after a few years of double digit annual increases. Everyone has a friend, relative or acquaintance who's had their house on the market for months without a bite. But the question is "At what asking price?" If your house is priced 20% above what it would have sold for a year ago and it isn't moving, that isn't a sign of a real estate market collapse. It just means that seller price expectations have gotten out of line with reality.

In the last few years we all became accustomed to a roaring seller's market and that became the new reality. But the truth is that in 'regular' real estate markets, houses sell in weeks and months, not in days. There aren't multiple bidders lining up with deposit checks at open houses. Price performance is at or slightly better than inflation, not 30% or more a year.

A return to sanity is not the same thing as a market collapse. The news media, though, don't sell newspapers or keep viewers tuning in with stories about a return to normalcy. They get viewers and readers with headline stories about "Real estate hits the skids. Prices drop for the 3rd month in a row." Yes, that may be true. But prices slipping in the 2% or 3% range isn't the same thing as prices dropping 20% or 30%. Now that would be news, but that doesn't seem to be happening. But if you're a seller banking on a 25% year over year increase, I suppose the current pullback in appreciation does seem like the sky is falling. And here in Sullivan County, we're not seeing that modest price slippage at all.

Swinging Bridge Refill Delayed

The water in the Swinging Bridge Reservoir is a little bit like the old song, "Charlie on the MTA" --- when will it ever return, when will it ever return. Hopes were high earlier this fall when Mirant indicated that the dam would be buttoned up by the end of November and the refill would begin. But that isn't going to happen. According to a story in today's Times Herald Record, the finishing touches on the dam repair are running 4 to 6 weeks behind schedule, and the coming of the cold weather may delay any refilling until spring. So it may not be until next summer until we know whether Swinging Bridge will actually return to its previous levels.

Niche Development - ATV Owners and Dog Lovers

Niche development focused around leisure pursuits is nothing new. Golfers and skiers have had developments targeted to them for decades. And places like Masthope and Hemlock Farms in PA have been marketed as year round, multi-activity destinations for families. There are 2 niche markets I'm seeing, though, that developers have not identified or targeted.

One is ATV (all-terrain-vehicle) afficionados. I get a few calls a month from people looking for a place where they can ATV with their families that's sufficiently remote so they don't piss off the neighbors. At the moderate, affordbale end of the market, in the $250,000 range, they're looking at a house with around 5 acres --- which isn't quite enough to get noise separation from neighbors and keep the peace. For a house on 30 or 40 acres with plenty of ATV-ing elbow room, they're looking at either spending upwards of $400,000 in Sullivan County, or going up another half an hour or hour into Delaware County.

Sometimes I think about keeping a card file of everyone who calls me about a place to ATV and putting them all together. What about a small development on 75 acres, with 10 individual 3 to 5 acre parcels surrounding a 25 acre ATV playground?  The ATV lovers who surround the ATV area aren't going to have noise issues, and they could form a noise buffer for other adjacent neighbors. Maybe 75 acres isn't the magic number, but you get the idea. Of course, there are insurance and other issues that would need to be worked out. But there is definitely demand amoung this group for a weekend second home getaway where they can pursue their hobby without hassle.

The other group that needs a welcoming place to go is dog lovers. A lot of second home searching, believe it or not, is dog-driven. A lot of dog owners in the city want a place for Bowser to be able to run and play. They often want a house with a pond, not for themselves but for their dogs to swim in. But a house with a good pond can be pricey. And then there are dog owners in the city who don't necesarily want to buy something, but would like a great dog-friendly B&B or resort within a few hours of NYC. How about a dog-oriented development, with a big central shared dog park with a pond, small houses available for purchase (or rent) and a big dog-friendly B&B for overnight guests?

There are certainly other niche markets, but these two are ones that just aren't served, and I hear from people with these interests over and over again. I expect to get flamed from some people that I've even suggested an ATV-oriented development, but the fact is that ATV-ers exist and its probably better to group them together with a sufficient sound buffer than to have them scattered about on their own 5 acre mini-pieces driving their neighbors nuts.

November Sullivan Sales Data Posted

Hey, everybody, its that time of the month again. My December Current Market Conditions Report for Sullivan County (which includes November's sales data) is up. Please check it out, and then come on back here and post your thoughts.