DIY Network's "Blog Cabin" is Coming to Sullivan

The Do-It-Yourself Network (on cable) has a cool show, Blog Cabin, where they either build or renovate a house for the tv show, and the audience votes on choices as the project progresses on the Blog Cabin website. Think of it as "American Idol" for houses, where the 'contestants' are countertops, faucets and paint colors.

The next Blog Cabin series is slated for Bethel. DIY has bought a dated ranch house on Happy Ave. in Bethel, with a view of Bethel Woods, and over the course of this coming season plans to transform it from a frog into a prince. The plans for the renovation are already up on their website, http://www.diynetwork.com/blog-cabin/index.html. This will be a fun project to follow, and should be great publicity for Sullivan County.

Comments

[ar]

I think the big news here is that a house was sold in Sullivan County! According to the web site, they bought it for the project. How much did they pay -- somebody out there has access to the sale price. I'm betting they paid a premium because it had to fit the particular needs of their show/blog. Maybe it even skewed the median.

[Mike in Barryville]

Morning Dave,

Good blog.

Dave, I think you're decieving yorself with you prices for 2010.

A house near Eldred just sold for $115,000.

A good deal for the buyer - 4 BR / 1 Bath on an acre. Wood floors, fireplace, finished basement, 1 car garage.

Four years ago, that house would have fetched near 200k. Maybe more.

Besides the lakefront house being offered on Bodine Lake in the same region for 149k (which sold for 355k about three years ago) - prospective purchasers should really get a handle on how weak this market currently is.

Also look at the pending sales data - a forward looking indicator - it's the lowest number that I can recall since those are deals that probably will not close until April/May 2010.

We're heading lower this year.

Good for buyers.

As far as most seller's, many are in fantasy land with their offering prices. If they're fortunate to have a job, they have two choices - ride out the storm, enjoy their house in the country and come to the conclusion that their property is now worth about 35% less than what they paid for it in 2005 - 2008 - or bite the bullet and look at the current sold data and adjust their offering prices accordingly.

Mike in Barryville

[David Knudsen]

ar, what a ridiculous comment, "The big news here is that a house sold in Sullivan County." Houses are selling here, fewer to be sure than a couple of years ago, and certainly for lower prices. And whether they paid too much for the house or not, because they needed a house that fit their needs, is irrelevant to the way I calculate median and average prices. That's the reason I always use 3 month data, so there are a sufficient number of sales so that any single sale doesn't have an inordinate impact on the aggregate.

Mike, yes sales are down. But one reason the 'pending' sales number has been coming down in the MLS is that the MLS eliminated one of the two 'pending' statuses. Previously there was "pending", which meant there was an accepted offer but contracts not yet signed, and "Contract signed." The MLS eliminated the transitional "pending" status, and has also been working to clear out old "pendings" and "contract signed" statuses that were never closed out.

I don't think I'm deceiving myself about prices. I'm actually pretty bearish. You can't just look at one sale and draw a conclusion about a trend. I said in this month's market conditions report that I thought we were heading to a median in the low $120's, but the curious counterpoint to that is that the average seems to be holding at around $160K.

The fact is that generally the only properties that are selling are those that are perceived as great values by buyers. We've been in that market dynamic for the past year, and I don't see that changing.

[JB]

Dave,
I would be interested to know whether there are any efforts to development business which would support people moving into the county. Hard to afford a home when there is no job/infrastructure. Thanks for a great and informative blog.

[rod]

in the end, ar's comments are mostly ridiculous - but they must serve some therapeutic value in lieu of his lighter pockets. Although, he does seem to be getting more hysterical and table-pounding.

I think the big news here is a blog (blog cabin) that had 320,000 visitors last week can actually carry on a positive, design oriented dialogue without interruption from nonsense. Reading other blogs, I'm constantly surprised at how this blog - even though the editor is both fair and amusing - can't serve up a topic without the world-is-enders taking over. Like I said, it must be therapeutic for the posters - since they do nothing but repeat the same thing for 4 years, although at least they gave up on the whole economy is coming to an end. Those posts were certainly ridiculous, in retrospect.

Good job David. It's always fun to see your knowledge of the marketplace mechanisms at work as well as your ability to push a conversation past the noise of nonsense.

[michael]

Right-o.

By the way, in Sillyvan County, I only calculate the median and not the average.

Why?

Because like you've been saying all along - all you need is one house that sells - say over 400k -to throw the average off and it skews it.

Plus, the volume of closings have fallen off so it skews it even more.

Use the median - it reflects a truer closing price.

Average:

{Add up the total closing price} / divide by the {total amount of sales} = Average Price

Median:

{List the closing prices of all the houses in a given period i.e.; 35k, 67k, 88k, etc... and then find out what the total amount of closings in that given period were - i.e.; 31 closings}

Your median price would be the 16th house closing price out of the total of 31 homes. 1 - 15 down and 17 -30 up - with 16 in the center.

Mike on Route 97 in BARRYVILLE.

[Nick]

Come on now Mike. Any smart person, like David here, knows that median and average are both approximations that each give their own kind of data. By watching them both move you can get a better sense of a market.

And there's not only those two variables. There's total number of sales, time on market, etc. David comments on all of these, which is because he's not a simpleton and knows it's kind of complicated to generalize about a diverse market, so you can look at different facets of it.

For example, compare Manhattan and Washington DC sales prices.

Manhattan's median is $850k, with an average of $1.39MM.
DC's median is 397k, with an average of 512k

So the markets look very different, but the relationship between the two is quite similar actually - Manhattan's median is 61% of average, DC is 58% of average.

But compare, say, Portland Oregon, with a median of 247 and an average of 290. That relationship way different, median is 85% of average. They're a LOT closer.

Why? Well because home prices don't follow a standard bell-curve gaussian distribution in every market. Many have a multipolar or bipolar distribution, etc. In the cases above, DC and Manhattan have a similar percentage because both are dense important cities that have a market for extremely high priced real estate. So the average is substantially higher as there's a notable very high end market. I assume here that Portland Oregon is a more "even" city, with probably fewer very poor neighborhoods, and without large numbers of super high end multi-million dollar properties as well. It probably is a more even distribution.

So let's pick a random second home area for fun. How about Eagle County, Colorado. Home of Vail and Aspen. And also some actual towns normal people live in. November median was $500k, average was $981k.

Whoa. That's a spread. Go figure... as you can deduce real easily it's a bifurcated market. There's rich out of towners and locals. In those stats you see that 41% of sales were below 500k. But 13% were above $2MM. And one zip code had an average sales price of over $6MM. Welcome to Aspen.

Sullivan County ain't Aspen. But it's not that different. I lived in Colorado for many years, most of the central mountains and Western Slope is pretty damm run down. Grand Junction and Port Jervis have a LOT in common, for example. Up and over the passes from glittery areas are brown expanses of trailer parks and meth-lab style architecture. But if you want a nice condo in Vail, Aspen, or Silverthorne, that's not really relevant to you, in the sense that if you want that it isn't cheap. It's a common attribute of vacation destinations.

So what's the point of all this? Oh right. Median and average are both important numbers. As is highest sale price, number of sales, all that stuff. And this is ESPECIALLY true in a thin market where a substantial portion of the money being spent in the area is not earned in the area. I could just envision you going on and on about the run down parts of Eagle County on one of their blogs, how some 3br house is listed at $200k and it's all a big house of cards. Oh they have gas drilling too by the way.

But if you're ignoring the other side of the coin, which is the tremendous amount of wealth drawn to the area, you're just biased.

Sort of like if you ignore the fact that Sullivan County is a short drive from the most expensive real estate market in the country, and it's not moving anywhere. Count Monticello and ignore Chapin Estate if you want. Count ranch houses in Gypsum and not estates looking down over Aspen.

Whatever works for you, but it ain't reality. Reality is sometimes more complex and subtle then a single median number.

[rod]

Mike in Barryville - appears those continuing ed classes are paying off.

[David Knudsen]

I don't think Mike quite deserves the big slam here. His point got me thinking about something. We — me, Nick, Mike, Rod, and even our friend, ar, are looking at the aggregate — which are these median and average market basket numbers — and trying to draw conclusions about the specific, namely, the price or value of individual properties. I don't think we can make that leap so easily. First, the median is being pulled down by the dirt cheap, often totally crap, foreclosure properties that are flying off the shelves. I'm not even talking about the $144K property on Bodine Lake, but the houses selling for $15,000 to $40,000. And then we have virtually total stagnation at the top of the market, with nothing selling. What that means for those Chapin houses, I don't know. But high end houses could be poised for an even bigger percentage hit from their market peaks than moderate to low end houses. The median id down 37% from the peak, but does that mean a farmhouse that would have sold for $300,000 in 2007 should now sell for $189,000, or should a Chapin house that would have gone for $2 million at peak now trade for $1.25M? Maybe, maybe not. Demand for that modest farmhouse in a mid price range is arguably stronger than for a top end property, so the market clearing price for the farmhouse might be $220K or $230K, while maybe the Chapin house would have trouble finding a buyer at $1 million. And when you get into the "value" range of the second home market, those affordable cabins and little houses on a few private acres, one that might have sold for in 2007 for $175,000 might still fetch $140K or even $150K today — because the demand profile is stronger at lower price points.

[mike]

***QUOTE of the WEEK***

Nick - you're entitled to a free car wash at the Citgo Station on NY Route 17B near Smallwood.

Good until the end of March.

===========================================================
***THE QUOTE***

"Sullivan County ain't Aspen. But it's not that different."

===========================================================

God, Dave, I wish there was boldface for times like these.

Mike in Barryville.

[rod]

That's what I love about you David. Always making sure no one gets hurt.

I don't think anyone who has been around much thinks the median or average is actually what the going price is for homes up here for the 2nd home buyer. If they do, they will waste a lot of some realtor's time looking to find it.

The median and averages have never meant to be the definition of what you can buy a house for - during the price run up, the median maybe went to $200k, but you couldn't buy ANYTHING for less than than $350k. Now the median may be $120k, but you can't buy anything interesting for anywhere close to that.

Did someone say Deja vu? Different year, same blog thread.

The median and averages are trend indicators at best - Sullivan County's real estate market is so wildly niche, that to extrapolate much other than momentum to these signals is a waste of time.

[Private Capitalist]

Rod et al,

There is no reason to tell a story about end of the world economic news b/c the fundaments already do that for us. If you want to know where the good ol US of A is heading, maybe you should find out what private capital is saying. If you know someone who is involved with private capital, say Westwood Capital, maybe you would be included with the inside scoop. But no, you know what yahoo finance tells you and what Obama tells you. The American Sheeple don't know that public capital is propping a deleveraging housing market. Private capital is not interested in your architectural designs.

[ar]

Dave, just for the record, I'm not writing "Mike's" notes under another name. There really are people other than me who haven't drunk the Kool Aid. "Not that different" from Aspen. And you call my comments ridiculous. At least it's comforting to know that "maybe" that $300,000 house bought in in 2007 is now worth $230,000 rather than $189,000. Phew! For a second, I thought the market had collapsed.

[Nick]

You know, just after I hit post on that, I thought to myself, you know... I have about a 100% chance guess that he'll ignore my systematic, logical, fact-based unraveling of his emotional biased rant based argument, and dwell on the idea of comparing Aspen to Sullivan county and that one line. I might have writtin that as "Sullivan county ain't Eagle County" but the point is obvious.

I was thinking, no he won't, that would just make him look like more of a biased moron, but, well, the rest is history.

I could answer a couple ways, but the first one would be, um, have you ever actually been to Aspen, and Eagle County in general? And I don't mean flown into EGE or otherwise gone straight to downtown Aspen, or taken a ski trip to Vail. Have you actually travelled around that area at all? Gone to places where tourists don't go?

(hint: as I mentioned, I ACTUALLY LIVED out there for years, you know like in real life, I know the area really well...)

Ever stopped for something to eat in Red Cliff and noticed it's like 70% spanish speakers and tons of check cashing and ways to send money south? Have you seen the trailer parks full of mostly mexican and latin american workers, crammed together in pretty dismal conditions? You don't think those sheets at the St. Regis hotel Aspen change themselves do they? Have you seen the ranch houses also crammed with people like the lift ops and other dropout type kids that man the resorts? The lower to mid-income ranch house neighborhoods where people like mechanics, or oil company geologists, or park rangers live with their families? Did you know that there's a major drywall factory in Eagle County, up and over the hill from Aspen? It's really hard to figure out where it is so I'll save you some trouble, that town is called Gypsum. Do you have an idea of concentration of extractive industries there (timber, minerals, gas, etc) and how that relates to the local economy?

Or is that all news to you? Surprise, surprise.

In actual fact the central mountains of Colorado are incredibly bi-polar in their distribution of wealth, and real estate. There's rich hollywood and business types on the nicest mountains with the best views, and there's a huge amount of locals who are lower middle class or downright poor, because as nice as the resorts are, that ain't enough. And the rich people push the locals out of the best real estate, leaving pockets of what looks oddly like urban blight in an otherwise sparsely populated area.

Sound familiar? Yeah Aspen and Vail are doing better then the racetrack or Concord's or whatever. But then again, that's a big area, and there's only so many ski resorts, and only so many months of high season. And there are probably ignorant message board posters there as well. I'm sure you'd get along fine if you decided to take a visit.

As to the topic that started this, median vs. average, it still stands. The market does not conform to a gaussian distribution or bell curve (google it). It has concentrations and haves and have-nots in close proximity. Like most sparsely populated regions that draw some portion of well-off tourists from somewhere else. Like, say, Eagle County. Heh.

There's a special place in the world for that unique combination of smug and ignorant.

Nick in Brooklyn and Bethel, depending on the day.

OK, that rant's over.

I will take you up on that free tank of gas offer though, could use it...

And to David, yes, aside from descending into message board flame idiocy later, sure the first response from Mike does have some good points, about the relationship between some current sales prices and what they might have gone for before. And I'll take his prediction of further losses as being sincere. I don't claim to know myself. I'm sure I'm pegged as emotionally biased as I have bought in SC, but I'm not the type to delude myself on stuff like that. I've bought enough crappy used cars to learn how to admit when you misjudged something a little and move on. I personally don't think the area is done for. I believe that Sullivan's problems are not unique and highly localized. The area for a century, or three, has always lived in the shadow of NYC. And as I live in the city I know the same mentality is prevailing here. People are just frozen solid financially. Those with good jobs are feeling nervous. Many have lost jobs but the vast majority that haven't are living in fear. That's hellish on things like nearby second home markets. Same thing in the Hamptons. But the forces that create this problem are not local to SC, they're basically global. It's a global economic downturn, and when confidence and spending are restored, things will level out again. They'll level out lower, bubble pricing doesn't come back, and tightened lending standards and so on will make it highly unlikely that it'll bounce back hard. Some will be underwater for years. Maybe even me, I dunno. But I still see these comments as short term thinking.

If you're a current shopper, perhaps short term thinking is a good thing. If you're a current owner, whatever. As long as living in NYC is a hellish concrete treeless existence, and NYC is a pretty well-off area, natural woods and lakes 80-90 miles away will generate some interest. No point being delusional. I've been coming to the area for 25+ years. I swear Port Jervis looks like it was preserved under glass and utterly unchanged in all that time. It didn't bounce back from whatever killed it. Monticello too. Then again, there's Milford.

But like I said, whatever. There are always permanent bulls and permanent bears, and they always get smug when it's their turn. It's as predictable as summer. But economics is cyclical, and the perma-bulls lives usually consist of being smug in periods of general bad news, insecure in periods when things are growing and doing well, and wake up 10 years later never having built or done much of anything enterprising, since it's always been the wrong time, either an "unsustainable bubble" or an "inevitable downturn that shows no signs of ending."

I'll be shoveling 36" of snow off my steps and hoping like crazy I don't have serious tree problems when I get up there in a couple hours. And I'll be having friends up for BBQ and beer and hanging out in probably 8 weeks.

I don't mind the former and I'm looking forward to the latter. How you feeling about life? And in all seriousness, if you're not a perma-bear then prove it. Give me a counterfactual. Tell me of a realistic scenario you can see *possibly* happening where SC would have strong upward movement. I can certainly see situations where things get worse and worse. I can describe a downward spiral where blight leads to bad development leads to poor zoning/planning decisons and I get totally hosed and the area just gets worse and worse. I'm not a blind optimist.

Are you a blind pessimist? If not, tell me what you think an alternate scenario would be if your prediction is actually wrong, show some brainpower.

[rohmann]

I see our friend from CF just purchased a 6.7 acre lot in Tusten for 34k.

Like we've been saying for the past few months, the days of wooded builable vacantlots in the 50k to 60k range are long gone.

CF, please don't dispute this since in a previous post you did.

4k to 5k an acre.

Ralphie

[Snowed-out]

he also bought 32 acres for a whopping 185k, so not too smart.

[joe]

Nick writes:

"...I will take you up on that free tank of gas offer though, could use it..."

-----

Nick, I believe it was a 'car wash' - possibly to remove the rose colored tinge on your vehicle's windshield?

:-)

...joe

[pa]

Some of you are displaying cabin fever.
It's safe to say that it was a hell of a run. What seemed like ridiculous dire predictions four years back is coming to pass. That does NOT give me any solace. It's just the reality of it. Sadly we are still a long ways from the bottom.

[ar]

Ok, Nick, I'm going to take a crack at the question buried in your latest self-referential avalanche. What would it take for SC to achieve sustainable "upward movement," as you call it? (And sustainable is critical -- the mini-boom of 2004-2007 in which you paid top dollar for your house was a once in a lifetime illusion.) The answer is that SC would have to attract a far greater portion of the demographic that has made household names of second-home towns in the Hudson Valley and the Hamptons. Think Rhinebeck -- places that don't produce that confused look you get when you tell people you have a place in Bethel. That demographic is Manhattan finance, high-end business (serious media [not funky wannabes], sophisticated international enterprises), medicine, high-end law). That demographic has bestowed obvious economic benefits on those places. Face it, the locals in those places just don't look as beaten down as they do up here. As Dave is always pointing out, housing prices are far less in SC than they are in competing second-home locales. But he never asks: Why? Isn't the answer greater demand, which is a consequence of greater desireability? Some people, me included, believed that SC could move "upward" without the same demographic profile as those other places. We were wrong. Selling a dozen houses a year to Williamsburg hipsters who think it's uncool to shop in the towns won't do it. There aren't enough successful garmentos from Long Island and Jersey to work a transformation. If the response is "we don't want to be like those other places," fine, but you know the consequences: already ridiculous property taxes will keep increasing to squeeze a thin and diminishing tax base; house prices will stagnate or fall further; that Let Us Now Praise Famous Men look to the local populace will endure. Why hasn't SC attracted the demographic that has made the Hudson Valley communities so vibrant? I don't know, but if it hasn't happened over a period of decades, it doesn't seem likely to happen ever.

[my two cents]

Good post ar.

"Why hasn't SC attracted the demographic that has made the Hudson Valley communities so vibrant?"

Here is a couple of reason:

1. Public transportation to NYC - MetroNorth - for those that do not (or don't want to) drive.

2. Historic base of the mid-Hudson / Berkshires to build on with regards to architecture and villages that date back to the 1700's along stage routes which became NY 9 and NY 22 --- with that museums, restaurants, buildings of historical significance --- and more importantly -- a desire by many locals to preserve and value what are the attributes of their region.

Most folks came up to Sullivan County as 'summer country boarders' from the city during the turn of the century by rail - Erie Railroad - from Jersey City.

There was no vehicular road linking Port Jervis to Hanock until the mid 1930's under FDR's administration. (NY Route 97).

Take a look at some of the beautiful establishments in the Western part of Sullivan from 1870 through 1930 where the Erie Railroad was.

The Western Sullivan hamlets were built around the railroad in the 1840's -- and not the other way around.

Where to look? Go to ebay and look at some of the turn of the century postal cards.

Anyway, when the railroad pulled out of these towns for the last time in the 1960's -- that led to some of the decay which towns in Ulster and Dutchess did not witness.

Also, by then, the children of those parents who frequented the Borscht Belt hotels in the 1950's and 1960's were looking at digs in the Hamptons, Cape Cod and the Jersey Shore.

It goes on.

But, what Dave (and others) saw in the mid 2000's --- and, unfortunately, what other hipsters, bought into during the same time period (courtesy of New York Magazine, Metropolitan Home, The New York Times, etc.) will never come back -- at least for a few generations.

My two cents.

[Nest Dweller]

"he also bought 32 acres for a whopping 185k, so not too smart."

Uhm, that's $5781.25 an acre. Depending on the quality of the land - and CF is relatively picky about where they build - I'd say that's a relative bargain.

As for the rest of you: yes, there was housing bubble. Yes, we all knew it would eventually burst. Yes, some people got stung. Yes, the market currently sucks. But it isn't the end of the world, for God's sake. Lighten up!

[David Knudsen]

two cents, good post. But I don't quite agree with the conclusion. Sullivan just needs to get back to its knitting, namely being better priced and offering a better value than the Hudson Valley, Columbia County and the Berkshires. The Hudson Valley is more expensive, and has been all along, on the way up, and now also on the way down. If a farmhouse on 5 acres outside of Saugerties or Rhinebeck costs $350,000, and a similar farmhouse outside of Jeffersonville or Livingston Manor costs $225,000, Sullivan can win that one — among buyers that can only spend $225,000. Sure, they can find something for $225,000 over in the Hudson Valley, but probably with less land or a less appealing house style. Those are the trade offs that buyers will ultimately decide to make. And it may take a couple of years for that value difference to become entrenched in the buyer mind set.

[MrK]

Nest Dweller, You seem the hipster mentality.... "wow, that's cheap..I'll take 2"
Thankfully, there is less and less dumb money chasing smart money out there.
Unfortunately, realtors prefer dumb emotional money over smart money.

[Nest Dweller]

MrK:

I gotta admit, I burst out laughing that anyone would think I'm a "hipster." Trust me, I'm so radically UN-hip that I practically need a pelvis transplant.

All I was saying was that one person was saying that CF got a deal at $5300/acre and someone else said he was not smart for buying at $5800/acre. Frankly, for what CF offers, if he's getting the type a property he likes to build on for $5800, then he's getting a deal. Not just "cheap", but a good value. You don't need to be "hip" to understand that.

My other comment was that the downturn on the real estate in not one of the signs of the apocalypse. Some people are taking this way, way too seriously. It's just money, people. There are other things to life.

I know... how "hip" of me.

[Nick Baily]

Thanks AR, and self-referential avalanches are my trademark. Just like Yahoo-Finance-message-board-stock-bashing-style is yours. We all have to have a "personal brand" don't we?

http://www.nytimes.com/2010/02/27/us/27iht-currents.html?sq=personal%20branding&st=cse&scp=1&pagewanted=print

Heh. And since it's obviously all about me please note I didn't buy between 2004-2007. I bought late 2008. The market had already crashed. It may have fallen further since, but I'm not a total nimrod, and my case is oddball anyways, bought an spectacular but damaged house with a renovation loan, my wife's an architect and did the reno/update plans and called in favors to get to-the-trade prices on everything. So my math is complicated and difficult to generalize from anyways.

But I appreciate your half hearted attempt at a response, though about 70% of your scenario for upward movement was further ranting about why it could never happen, it must be noted. But yes, you've identified in the broadest terms what the counterfactual is. Let's all be rational. I see your argument, and those on your "side' roughly as follows:

1. Sullivan has never been high end, it's always been the least desirable of the NYC radius second home markets, and that whatever has made it less "cool" or desirable before, has no reason to go away.

2. There was a bubble of major proportions but the long term trend has been down, not up, and recent boosters ignore/miss this trend, measured in decades.

3. Going forward, the most important forces that affect the market will tend to make it worse, not better, and these are:
- Tax base erosion, higher taxes for weekenders, less demand, more taxes, in a death spiral
- Continued erosion of the local economy, more run down stuff, more blight, even less to attract the "kool kids" looking for charm.
- The "wrong kind" of development, like gas drilling, or ill-conceived casino type projects that might be a real turn-off for second home buyers.

...am I fairly characterizing your point of view? If not fill in the missing bullet points.

Those are all valid arguments, if you'd step out of bashing mode for a second. And unlike you, I can definitely see the other side and look at those and say "Hey, you might be right, there are some strong arguments there." I don't agree with your overall prediction, but the difference between bias and pragmatism is that I don't think it's all black and white. Of course things could go one way or the other.

But I have my own points, where I see things a bit differently. To respond:

1. You say "The answer is that SC would have to attract a far greater portion of the demographic that has made household names of second-home towns in the Hudson Valley and the Hamptons. Think Rhinebeck -- places that don't produce that confused look you get when you tell people you have a place in Bethel."

Few things:

First off, the people I talk to don't know what Rhinebeck is either. They've heard of "The Hamptons" but when I had a rental in Amagansett for years most of my friends said "what's that?" until I said it was in the Hamptons. Say Water Mill or Sagoponack and it's the same thing. They don't know Rhinebeck, or Kingston, or anything. And actually the blank stares are easy to avoid. I say "where the original Woodstock festival was, ever see the movie?" and then they know exactly what I'm talking about. Try that with New Paltz.

Anyways, most people don't have an opinion at all. Remember every year there's a new generation that shows up from DC or LA or Shaker Heights to make it in NYC, without years of preconception. Old timers still want to tell me about abandoned buildings and heroin addicts in the East Village tenements. The next generation smiles and nods and edges away, they don't care. I'm old-timer enough to still be astounded at Williamsburg being upscale at all. So what? Despite the downturn another block gets renovated every couple months.

You say "household names" but these hypothetical people know basically very little. New York has a LOT of people, the vast majority don't know *anything* about any of these places.

If you ask people about surrounding weekend home areas they could usually name four: Hamptons, Jersey Shore, Hudson Valley, and the Catskills. And the latter two actually would be a stretch, most would probably name three, the third being a generic "upstate." I reject your "household" name premise outright. People just don't know these areas at all until they start looking, or until a friend invites them. Same as it ever was.

But back to your point, you say SC would have to "attract a far greater portion of the demographic." Are you sure? Why is it a "market share" equation? What if the demographic just gets a lot bigger and SC keeps the same percentage of it? NYC's population keeps getting bigger, growth slipped after 9/11 and again after the financial meltdown but trend is clearly solidly up. The trend for my generation and the one younger is to have grown up in the suburbs, with a higher propensity to live center city. That's the classic recipe for weekend home interest as people grow up and settle down a bit but remain the city to raise a family.

2. You say "Why hasn't SC attracted the demographic that has made the Hudson Valley communities so vibrant? I don't know, but if it hasn't happened over a period of decades, it doesn't seem likely to happen ever."

The second sentence is just a base logical fallacy. If things haven't happened then they never will. Do you realize how much you echo the clearly ignorant logic of the bubble people you think are so stupid? The ones who said "real estate has never fallen more than X far and more than Y fast, so if it hasn't happened over a period of decades it doesn't seem likely to happen ever." How did that mentality work out for Lehman Brothers. LTCM had the exact same logic.

Things stay the same... until they don't. That you can bank on.

As to the former -- why hasn't SC attracted the demographic? Rephrase this one. The question is why hasn't it attracted *ENOUGH* of the demographic. Clearly there are upper middle class and college educated NYC'ers buying up here. Some of 'em. Not enough it seems. Well first start off with the two reasons why Sullivan HAS attracted that demographic, to the extent that it has. I see three very simple giant reasons:

A. It's under 2 hours away.
B. It's still very affordable.
C. It has lakes and woods and "nature" which many people want.

Easy enough. Those are really big reasons. Seriously, they matter a LOT. But what's the problem then. Two cents above hits on it pretty well. I'd see them as follows.

D. Lack of train service. This isn't likely to change any time soon. They are talking about connecting the Port Jervis line via the Tappan Zee, who knows. But Secaucus and new Hudson Tunnel plan will kill the need to change trains, that's imminent. Could that line run up to Barryville, or Calicoon? Well the tracks are sitting right there, not too complicated. But wouldn't bet on this, and driving works pretty well. That said, if for some reason there was fast passenger rail service to SC it would be astonishing though, it would snap heads how fast things would change. Life is long. My dad got bombed by the Nazis during the blitz, he's still around and bought his own place in SC a couple years ago. Careful of that short term thinking. Unless yer old. But yes we should call this a "permanent" problem, I'm not insane.

E. Lack of services. This is less important than D but easiest to change. I see this as the single biggest issue. There's a shortage of good restaurants and good markets and similar. This is a real problem. Will it change? Classic chicken/egg problem but sure, it could. I knew Smith Street, Brooklyn when you kind of needed to speak spanish to order food. I watched it become one of NYC's restaurant meccas. Why there? Aha, Look at my A, B, C -- it was very close to Manhattan plus burgeoning surrounding neighborhoods. Had the right landscape (low-rise, every structure a storefront the size of a small restaurant), and it was cheap. The chefs came running. Only takes a few to light the fire.

F. Blight. This is also real important. The run down feeling I have to guess is the single biggest issue. I know among the "people" I talk to, who don't know much intricacy of weekend home buying as mentioned, basically divide things kind of into "redneck/rural/sticks" and "country/quaint" and there's a lot of snobbishness. Can this change? But of course -- have y'all seen Milford? I remember when that place was rust belt mess. It was pretty recently. Monticello may be too big with too many housing projects for that treatment. But the main street area wouldn't take much, the structures are there. Liberty? Tough, but possible. How about the corridors leading into Bethel Woods? I'd say that's actually inevitable in the near future.

G. Lack of "quaint little areas" that city people find appealing. This is kind of an amalgamation and summary of the last couple. That's what's missing in the simple short term analysis. That's what the northern Hudson Valley towns have that Sullivan is lacking. Milford has it now. Beacon has had it for a while.

But which of these are dependent variables and which are driving forces?

I would argue that A, B, and C are governing. To conclude another "avalanche" of verbiage, the logic walks through these steps.

* New York City has a high concentration of wealth and continues to grow. The downturn is global, not unique to Sullivan, and cyclical, meaning it will end. At some point. It always does.

* There are only so many areas in a 100 mile radius of the city for simple weekend getaway purchases. Most of this circle is chock full of stuff already,

* Sullivan County has the base level attributes that make it desirable (sufficient woods, parks, rivers, nature), and its proximity to the city can't be changed/challenged.

* Sullivan County, when compared to other areas in this radius with these attributes is by far the most inexpensive.

** Therefore, I conclude, that like so many areas before it, the chicken and egg problems will follow the natural path they always do in every area that gentrifies. First the pioneers set up shop (PS these are the "Williamsbug Hipsters" and write them off at your peril, they can be pretty enterprising, have you seen Williamsburg?) followed by the "me-too" types who want to be on the front edge of something happening and are constrained financially enough to make some compromises, and then come the lifestyle changing "drop-outs" like chefs, bakery owners, cafe owners, and whatnot, who set up shop. Then the yuppies all flock to the undiscovered gem.

When this happens there's usually a few core large scale institutions that alight as magnets (DIA:Beacon, Mass MoCa, Bethel Woods), and there's usually one or two towns that go first and fully gentrify, while surrounding areas take a long time to catch up.

Not only is it plausible, it seems almost inevitable. For the same reason those Park Slope brownstones aren't $50k any more. There WAS a time RECENTLY when people thought moving to *anywhere* in Brooklyn was literally insane. I *still* get clueless people saying that, unaware that Brooklyn Heights costs a LOT more than the East Village. Unaware it's one stop into Brooklyn, and a lot closer to well, everything, than the Upper West Side.

And well, there may be a time one day when someone says how the HELL did you manage to buy a nice, large, historic house on over 20 acres under 90 miles from Manhattan? There's only so many places you can do that. I'll say I ignored the bashers. Like everyone in the universe that bought in when an area was still pretty iffy.

And if I'm wrong? I still have the land, and I'm getting to be a pretty good shot with some practice this winter, so at least I can pick off the crackheads and gas drillers you think will be overrunning my lawn, for some cheap entertainment.

:D

Happy Monday....

[CF]

I also bought a 5 acre lot for $44k not so long ago - so I think the conclusion is unclear.

Not all sellers are as motivated - not all land is the same. timing is important. as is the motives of a buyer.

There's not much good out there at $35k, regardless. But even if there was, it is still a 45% increase to what you needed to pay in 2003. Not a bad return.

[mike]

"There's not much good out there at $35k, regardless. But even if there was, it is still a 45% increase to what you needed to pay in 2003. Not a bad return"

-------

I don't know where he gets his figures.

Buys a lot in 2010 for 34k and change. Back in 2003 it went for 25k. Pay taxes of about 1.2k for the past six years. Add the 7k onto your cost basis of 25k and you're at 32k - less whatever legal fess, real estate fees along with survey and engineering.

I say you break even if you held land in Sully since 2003. You lost if you bought after that.

Mike S. in Barryville

[CF]

And also, I can vouch for Nest Dweller's unhip qualities.

[Nest Dweller]

"And also, I can vouch for Nest Dweller's unhip qualities."

Ouch. :) On that note, I'm gonna go have a nice cup of coffee (note: not a double low-fat macchiato) and revel in the fact that said cup is half full.

[Nick]

Come on Mike, $50 per thousand in taxes on a *SELLING* price of $25k, no adjustment for equalization/assessed at all?

Is vacant land taxed at a dramatically higher rate than everything else? If so sincere apologies for my ignorance.

If not, buying for 25k and selling for 34k represents about a 30% price increase in a plot of real estate.

We're entitled to our own opinions, not our own facts. Thanks for playing but it's growing beyond tiresome. You seem reasonably smart... what's the point here?