Sullivan County Real Estate

Real Estate "Sales" — Do They Work?

Last evening, the listing agent for the property at left called to tell me that the builders of this new construction home at Timber Lake (non-lakefront with lake rights), listed at $429,000, are holding a Labor Day weekend sale, dropping the price for Labor Day weekend only to $409,000. I've gotten a few similar calls over the past couple of months, offering time-limited "buy it now" sale prices, but usually for a multi-parcel or multi-home developer closeout. For example, last weekend the Highlands at Bethel had a "blowout" sale on unsold 5 acre lots. This is the first time I've heard about a time-limited sale on a single property, although a few houses have tried the auction approach.

This house at Timber is quite nice, 1,700 sq. ft. 4 bedroom, 2 bath with a fireplace on a nice wooded parcel with lake rights to Timber Lake. The $400K+ market if finicky, though, and tough to crack for houses without an on-property water feature (stream, pond or lake) or larger acreage. Access to Timber Lake, though, is certainly a benefit, and a similar-sized lakefront house would likely start somewhere in the $500's. At $409,000, it will be interesting to see if its moved into that sweet spot, price wise, where buyers see it as an exceptional value.

The other question is whether time-limited sales work for single-unit real estate. Developers have used sales effectively in some areas to move a large amount of inventory, or at least the highly publicized sales create buzz and interest that may result in down-line sales. The key for those, though, is publicity. Multi-unit developer sales usually have a lot of advertising run-up. However, even though the sellers put time limits on the "sale", I always feel that if a buyer came in with a good offer a week later, they'd take it. Real estate isn't quite the same type of sale as cars, where sales like GM's Employee Pricing have a drop dead date (although GM has been known to extend it.)

I applaud these sellers for trying the sales route. If nothing else, it indicates they are motivated to move the property. That indication of motivation is crucial to have a property gain share of mind among brokers and agents.

If you're interested in this property, I'd love to work with you on it — but myself and my colleagues at Catskills Buyer Agency are already booked for this Labor Day weekend. So if you want to see the house this weekend, you may want to contact the listing agent directly, Nancy Fredericks at McKean Real Estate in Barryville, 845-557-8338.

The End of Summer

The calendar still says "August", but everywhere there are signs that summer is drawing down. Over the past week, nighttime temps have dipped into the 40's, getting me to pull out an extra blanket and even turn on a dash of heat. (Its cooler earlier than I remember.) I've also taken to wearing long pants again, something I steadfastly try to avoid between Memorial Day and Labor Day. A sweatshirt or sweater is again de rigeur for outdoor dining.

There are other signs that summer is coming to an end. Home grown tomatoes are finally turning red, and friends are struggling to find uses for their annual huge harvests of zucchinis. Most friends this week also have their houses filled with house guests for the last fling of summer. In Monticello, both Wal Mart and Staples were packed this week with city folks stocking up on school supplies for their kids returning to school. (Remind me never to go shopping the last week of August!)

The end of summer is always bittersweet. The chill in the air is a reminder of winter to come, and of all the well-intentioned chores that never got done, like restaining the deck or building some new raised garden beds. I'm always amazed at how fast summer sweeps by, like a chocolate truffle — luscious while it lasts but only two bites long.

Of course, fall is lovely here, but different. Its quieter, we move back indoors, walking replaces swimming, and before you know it, the leaves have turned and blown off the trees. City folks, even if they keep their houses open, shift their lives back to the city, coming up less and less. In November and December, there will be a flurry of 'house closing' parties, when second homers begin shutting their houses for the winter — and clear their cupboards and refrigerators of half-used jars of capers, jams and wasabi paste. There's a rhythm to the seasons here that you just don't feel the same way in the city, and it always seems most poignant as the end of summer slips into fall.

Two New Businesses

If you've strolled down Main Street in Callicoon, you may have passed the freshly renovated digs of the Callicoon Wine Merchant (25 Lower Main Street.) They've been open all summer, sans wine, selling a delightful range of artisan cheeses, olives and other accompaniments while they awaited their wine license. Well, they finally got the approval to sell wine, and have now stocked the store with a great selection of wines. Its a wonderful little store. Please drop by and support them. (Mon., Wed., Thurs. 10-6; Friday and Saturday 10-7, closed Tuesday. Phone: 845-887-3016.)

Another more hidden gem is the Korean Arts Village, at the site of the Island Glen golf course on Route 17B between the Bethel Woods turnoff and Fosterdale. I went there last night with 5 friends for dinner. Now, I'm not a big Korean food afficionado, but it won me over. And my friends, who are, all raved about it. The Korean Arts Village is really geared more towards to Koreans than us occidentals, and in fact, was established more as a summer camp / retreat for second generation Koreans to bring their children to experience traditional Korean culture. Our waiter didn't speak much English, and the signage and website (www.koreanartsvillage.com) are mostly in Korean — but there is an English menu.

The food is plentiful and delicious, and the view from the outside deck over the golf course and pond to the hills beyond is stunning. We all commented that we didn't feel like we were in Sullivan County at all, and in fact, felt like we were back in our "Lonely Planet" days, in the hill country of northern Thailand.

Catskill Citizens Drilling Update

I received an email this morning from the Catskill Citizens for Safe Energy (www.catskillcitizens.org) with a .pdf update about a recent meeting between 8 environmental organizations and the DEC in Albany, as well as an overview of the gas leasing presentation held this past week in Lake Huntington. The .pdf isn't on their website yet, so I uploaded it to my main website so you can download it. (Click here to get the .pdf.) If you're following the gas drilling issue, you may want to read it over. There's some good info.

Good Buyers, No Houses

I just did a preliminary run of the August sales figures, and it looks like August is going to be as lackluster as the past few months. So what's up, given that a lot of agents (including myself) are reporting that they're busier and seeing a pickup? The problem, I think, is that we don't have the houses that buyers want, and are spending considerable time chasing phantom inventory that doesn't actually lead to sales.

I'm working with 4 clients right now who are looking in a range from $400,000 to the low $500's. They're good buyers with reasonable expectations. They're not 'bottom feeding bargain hunters' looking for that elusive foreclosure deal. They're all looking for something slightly different, so not competing for the same house. One is looking for a nice lakefront house on a non-motor lake, another wants a smaller contemporary in a cool private setting, the third is looking for a BIG house with privacy for large family get togethers, and the last is shopping for a mid-sized renovated farmhouse in a rolling farmland setting. None of these buyers have unreasonable expectations and would buy something tomorrow if they found something they like.

But I'm having trouble finding them houses. We go out on trip after trip to look at houses, but nothing screams 'Buy Me!' Most of the houses we see have one or more significant downsides — quirky designs or layouts, unfinished renovations or dated interiors. The common element among these clients is that they don't want to do a lot of work, and for what they're looking for at the price they're willing to pay, they shouldn't have to.

This situation isn't unique to me and my clients. I often get calls from other agents asking me if I know of something for one of their customers. (Because I cover a wide area of the county, and talk regularly with dozens of agents, I'm often aware of properties that aren't multiple listed, or have seen properties that are outside of another agent's geographic comfort zone.) Yesterday, an agent friend with a lakefront customer up to $600,000 called to ask if I knew of any medium-sized lakefront contemporaries in that price range. I didn't. We traded notes about the handful of houses in that range we'd both already shown, and pretty much agreed on their limitations and drawbacks. We both lamented that there were so few good houses in this key segment, and ticked off a list of lakes that have no available houses whatsoever on them.

I've had similar conversations with other agents about other key property categories — particularly renovated farmhouses under $500,000, river properties and privately set contemporaries. Given the frequency and similarity of these calls, and the speed at which good houses in these categories are snapped up when they come to market, there are definitely buyers out there. But there aren't the houses for them to buy.

NY Times: Bright Spot in A Bad Economy

Interesting article in the NY Times "Escapes" section today — Bright Spot in a Bad Economy: Renting Out (Your Second Home). Basically, the author is saying that vacation home rentals are becoming more and more popular. The reasons? Better value than staying at luxury hotels, and in a down economy, more vacationers are turning to close-by drive away destinations rather than exotic (and more costly) fly-away vacations. That's definitely been the case here in Sullivan County, where everyone I know who put their vacation home up for rent, for just a few weeks or the whole summer, has been fully booked and turning customers away. Now, that isn't a reason to go out and buy a second home as an investment for summer rental. The rental season here is just too short (summer/fall only, and we don't have a winter ski rental season), and the numbers don't add up as purely an investment. Another driver of rental demand this summer has also likely been potential buyers deciding to rent rather than buy until they have more confidence in the market — and if the market stabilizes over the next year and buyer confidence strengthens, that may temper rental demand somewhat.

Fits and Starts

I wrote last week that I was "slammed busy" last weekend and that other agents were commenting that they were also quite busy. This week has unexpectedly been much quieter. This "fits and starts" roller coaster has been going on for a couple of months now. A couple of busy weeks followed by a couple of slow weeks then another busy spurt. (None of my appointments from the last two weekends resulted in accepted offers.) But then there's traditionally a slowdown here during the second half of August (families going on the last end-of-summer fling and also getting kids ready for school), and we only have two weekends to go before Labor Day. Does anyone else feel this summer went by really quickly, or am I just getting older?

Houses Not Coming To Market?

A common theme among a lot of real estate commentators and writers is advice to sellers to wait to put your property on the market if you don't have to sell now. In that advice is an inherent belief that the market is bottoming and will improve next year. That seems to jive with what I've been feeling here, that there haven't been that many great properties coming to market this summer. But I wondered if that was actually true. So I took a look at 2 property categories that I regularly track, lakefront homes and non-lakefront homes on 10+ acres.

From Jan. 1 to July 31, 2007, there were 80 lakefront homes listed for sale during that period, with a median asking price of $430,000. (Note: this is not a 'snapshot' of the number of lakefront homes on the market, but only of lakefront homes with a listing date between 1/1/08 and 7/31/07. Carryover listings from 2006 that were active during that period were not included.) Between Jan. 1 and July 31, 2008, there were also 80 lakefront homes listed for sale during that period, with a median asking price of $495,000. Even though the same "total inventory and carryover issue" applies, if the theory about sellers holding property off the market is true, I would expect that the number of new lakefront home listings would be a fraction of the previous year.

In the non-lakefront homes on 10+ acres category, there is a similar inventory picture. Between Jan. 1 2007 and Juy 31, 2007, there were 104 new listing with a median asking price of $399,000. For the same period this year, there were 102 new listings (with an almost equivilent median asking price of $404,950.)

So inventory is coming to market, but the problem we're facing is the one we've tended to face historically. There may be lots of inventory, but there isn't lots of good inventory. There are currently (snapshot here) 84 lakefront homes listed for sale here, and I've seen most of them. Probably only about half don't involve some significant compromise (poor condition, seasonal-only use, lakefront access separate from house, road between the house and lake or road noise from a nearby major highway.) Of the remainder, only a fraction of those are particularly well priced and able to elicit the coveted "Great value" moniker from potential buyers.

Current Market Conditions Up with July Data

I finally finished the August Current Market Conditions report (with July's closing data.) Some real interesting stuff this month that I'm still pondering. Sales plateaued (hey, that's Realtor-talk for 'flat') at 105 for the previous 3 month period, about equal with the June number but up from the miserable, why-don't-I-just-slit-my-wrists 86 sales for the 3 months ending in April. The median price, though, rose again for the 2nd month --- and I expect August's price numbers to climb higher, based on sales in contract but not yet closed. And buyer activity seemed to pick-up starting in mid to late July. The cloud moving over these brightening skies? Mortgage rates are way up.

Check out this month's Market Conditions Report and come on back here and add your comments. I have a feeling the back and forth this month will be pretty lively!

Slammed Busy

Regular readers may be wondering where this month's Current Market Conditions report is. Well, its coming. But for the last week, I've been slammed busy. The pickup started in mid to late July, with a steady stream of email and phone inquiries about property. This weekend, for the first time in months, I'm fully booked with appointments, and people are already starting to book ahead for the next few weekends in August. I'm hearing very similar reports from other agents I'm talking with. It sure helps that the economic news seems to be getting better. The stock market has been shooting up, oil prices have been plummeting, and the dollar is even gaining ground against the Euro.