February Sucked

I'd pretty much say that sums it up. Looking at the preliminary data from the Sullivan MLS for the 3 month period ending Feb. 29th, there were 98 single family home sales closed(down 18% from a year earlier). The average sales price of $185,445 was off 14% from a year earlier. The median sales price of $164,400 was off 9% from a year earlier, but does appear to be holding in the mid $160's. The fact that the median is holding while the average continues to slide seems to support what I've been seeing for months, that the buyers who are buying are moving into substantially lower price ranges.

On the activity side, February didn't hold out a bright light for the near term. February is usually a pretty busy month here in the second home market, with folks shopping for houses so they can be in for summer. I didn't see a lot of activity this February. On weekends, I typically had one appointment rather than 2 or even 3 the year before. True, the weather wasn't fabulous on some weekend days last month, but there were plenty of reasonably nice days is someone was really motivated to come up and buy a house. In general, the people I did go out with just didn't find the deals they were looking for (I wrote about that at length in the post below, "Expectation Fatigue""), and I went the whole month without making one deal.

Interestingly, I've gotten a lot of inquiries over the past month for 'super cheap' properties — under $100,000. I've been referring them to other agents, because its just not my market segment. I don't stay on top of inventory in that range, which are typically seasonal cottages, coop bungalows or handyman fixer-uppers. But over the next couple of months if the mid-market doesn't pick-up, I may start focusing on the budget end again. I feel a little bit like a salesman at an Acura dealership who had a great year last year, but the showroom is now empty and the people who are looking for a car are going to the Chevy dealership across the street. The problem, though, is that a lot of those Chevy shoppers still really want an Acura.

The one bright spot in this seems to be upper end lakefront homes. A house on the market at Tennanah Lake for $1.29M went into a deal this past month. A house closed on York Lake for $875,000, and a house listed for $850,000 on one of the secondary lakes at Black Lake Estates is in contract. In the category "private lakefront", demand still seems to be outstripping supply.

Comments

[CP]

the lack of comments is almost as telling as the lack of NYTimes Sunday Real Estate listings for 'Hudson Valley Houses". What used to be 16 column inches now fits in a small vertical one column box.

As David said - the sport of real estate is over.

[BR]

I have heard suggestions that there are particular pockets in the Catskills where market conditions have NOT deterioted. Can anyone comment whether such area(s) exist?

[TR]

...trolling?

;-)

[David Knudsen]

BR, when evaluating comments about an area being 'good' or 'not so good', its important to look at the time frame the person is commenting about, and what behavior they're talking about. My comments, as well as data that I report, tend to be very recent and timely. Any closings that have happened in the past month actually reflect buyer behavior from November and December. A slowdown will also not hit all areas simultaneously, nor with the same impsct. So its important to pay attention to trends. If, for example, some people start looking in Sullivan and find it too expensive they may shift to going further from the city, the say, Margaretville or Walton --- and so there may be a pickup there. But it may not have long term legs, if prices closer in moderate further.

[David Knudsen]

Chuck, your comment about the 'lack of comments' is prescient. I've been closely following various site statistics. Visits to this blog are down about 20%, and that drop off started about the 1st or 2nd week of February. I also scoured my Google statistics, looking specifically at how many times key phrases for Sullivan County real estate were searched (not how many click throughs or site visits I got from Google, but rather how many times a search term was entered in Google.) That's down about 10-15% from January. Visits to my main website and property searches are also down about 15-20%. All of those stats indicate a decrease in interest, and interest is the first step to action. Through both of the downturn 'scares' over the past 18 months (late summer/early fall 2006 with the predictions of doom and gloom in real estate, and late summer/early fall 2007 with the mortgage crisis), the search numbers held pretty steady. When the real estate downturn didn't materialize in this region in late 2006, there was a big pick-up in activity in early 2007. That didn't happen this year.

[TR]

This was realeased today at 10:00am.

Factual data such as we're now seeing (they're not making it up) certainly does nothing to close the psychological gap of bid and asking prices in Sullivan - or better - what the original offering price was and after (months and years on the market) what the property eventually sells for - which sometimes can be as wide as the Grand Canyon.

~TR

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B04CCFD50%2D12B5%2D4833%2D9396%2D49EA51230C53%7D

U.S. foreclosures hit another record high, MBA says

By Steve Kerch
Last update: 10:00 a.m. EST March 6, 2008Print RSS Disable Live Quotes

CHICAGO (MarketWatch) -- The percentage of mortgages that were in foreclosure hit a record high in the fourth quarter, while mortgage delinquencies rose to a 23-year high, the Mortgage Bankers Association said Thursday. A record 2.04% of U.S. mortgages were somewhere in the foreclosure process at the end of the year, while a record-high 0.83% of loans entered foreclosure in the fourth quarter, the trade group's quarterly survey found. More homeowners fell behind on payments as well, with 5.82% of loans past due in the quarter. That was the highest delinquency rate since 1983. MBA Chief Economist Doug Duncan said declining home prices were the driving force behind the foreclosure record.

[TR]

This was realeased today at 10:00am.

Factual data such as we're now seeing (they're not making it up) certainly does nothing to close the psychological gap of bid and asking prices in Sullivan - or better - what the original offering price was and after (months and years on the market) what the property eventually sells for - which sometimes can be as wide as the Grand Canyon.

~TR

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B04CCFD50%2D12B5%2D4833%2D9396%2D49EA51230C53%7D

U.S. foreclosures hit another record high, MBA says

By Steve Kerch
Last update: 10:00 a.m. EST March 6, 2008Print RSS Disable Live Quotes

CHICAGO (MarketWatch) -- The percentage of mortgages that were in foreclosure hit a record high in the fourth quarter, while mortgage delinquencies rose to a 23-year high, the Mortgage Bankers Association said Thursday. A record 2.04% of U.S. mortgages were somewhere in the foreclosure process at the end of the year, while a record-high 0.83% of loans entered foreclosure in the fourth quarter, the trade group's quarterly survey found. More homeowners fell behind on payments as well, with 5.82% of loans past due in the quarter. That was the highest delinquency rate since 1983. MBA Chief Economist Doug Duncan said declining home prices were the driving force behind the foreclosure record.