Sullivan County Real Estate

New Pastry Shop Opens in Jeffersonville — Yum!!!

I LOVE pastry! (The horizontal expansion I've experienced over the years is not due to a love of celery.) So I'm thrilled that a a new pastry shop/bakery, the Brandenburger Pastry Barn has opened in Jeffersonville. I still love the Flour Power Bakery in Livingston Manor, but now I have sweet tooth satisfaction much closer. So I can justify stops to the new Pastry Barn as good for the environment, saving all that gas it would take me to drive north to the Manor.

I wasn't able to stop by for the grand opening this past Sunday, when they were handing out free samples of their tasty treats. (Boo, hoo. I was working.) But friends who did stop by reported that it's quite wonderful. The Brandenburger Pastry Barn is open Tuesdays through Fridays from 6AM to 4:30PM, and on Saturdays and Sundays from 8AM to 4PM. The address is 4923 Main Street, Jeffersonville, next to Global Home. Coffee is available to go with your pastries, but seating to indulge on site is limited to just two tables. 

Sullivan Asking Prices Climbing

March is typically when inventory starts recharging here, after the midwinter low point. The reason is two fold. Some sellers take their houses off the market during the winter, because they don't want to keep them plowed out for showings, and put them back on the market in the spring. And new sellers often bring their houses to market in the spring in anticipation of the summer buying season.

The seasonal uptick is as predictable as the swallows returning to Capistrano, and this year is no exception. There have been 128 new or retread single family listings added to the Sullivan MLS over the past 30 days. So there have been a lot of new listings to ponder. What's notable in many cases sellers are stuck in the la-la land of another era regarding their asking prices. I've seen a handful of retreads come back to market with higher asking prices than when they were last on market in the late fall, and quite a few that still have asking prices the same as their last couple of trips to market.

Since early February, when the average asking price for single family homes listed in the Sullivan MLS hit a 7 year low of $251,649, the average asking price has risen 2.3% to $257,525 (which is 7.9% below the average asking price in March 2010.) The current average asking price is down 17% from the peak of $310,378 in June 2007. But since 2007, the average sales price has dropped roughly 35%. Some of the drop in the average sales price can be attributed to what's been selling. Sales of larger and more expensive upper end properties have been soft, and fewer of those sales push the average down. I don't have the statistical skills to adjust for that. But for the sake of argument, let's say that on an apples to apples basis that sales prices have dropped 25% to 30%. That still leaves a big gap between the drop in actual sales prices and the far more modest drop in seller price expectations as reflected in the average asking price.

I've been hoping we'd see a continuing drop in the average asking price, as it indicates that sellers are adjusting to the current realities of the market. I hear from listing agents across the spectrum here that pricing discussions with sellers are very tough, and that many just won't follow an agent's pricing recommendation.

The conundrum facing listing agents is whether to take the listing at the price the seller wants rather than the price they recommend, or not. (This has been debated a number of times on this blog.) But there's very little downside for an agent who takes an overpriced listing. For most agents, it takes only a few hours to take and post a basic listing in the MLS. It only costs them about ten bucks to post it in one MLS, maybe twenty if they list it in more than one MLS. Very few agents spend a lot of time photographing a house well or creating a virtual tour.

So for a half day's work, a couple of gallons of gas and twenty bucks, why not take the listing? The upside is that the seller may get religion after the house has languished on the market for six or nine months, and reduce the price. And every listing gives a listing agent one more marketing point on Realtor.com or other real estate websites where a potential buyer may see the listing and click or call through to the agent, which is also an opportunity to show or sell them something else.

This business is listing-centric, and the common wisdom is that the more listings you have — good or bad, overpriced or not — the bigger net you cast to snare buyers. Personally, I don't think that's "working smart." But the reality is that in Sullivan, as in most markets in the country, there are far too many Realtors for the amount of business. If an agent isn't busy selling, they might as well take listings.

There are, by the way, some agents here who do turn down listings. They tend to be the more successful agents who are actually busy. They're also the agents who spend considerably more time listing the property. They'll take two or three hours to photograph a house, with good cameras and lights. They'll spend time reviewing comps, and collect deeds and surveys so they have a complete listing package available. If they think a property isn't sellable at the price, they don't want to expend the time and effort. But these agents are  few and far between.

The listing landscape would likely be very different if it was more costly to carry a listing. In New York City, listing agents tend to be very tough with sellers on pricing. Why? In the city, it's almost de rigeur that properties have to be advertised on the NY Times Real Estate website. That costs agents from $70 to $140 per property per month. That's a chunk of change, and agents are very hesitant to fork that out for a condo, coop or house that's significantly overpriced and unlikely to lead to a sale.

Here, the cost to carry a listing is close to nil, particularly since very few houses are advertised in print any more. If it cost agents even $25 or $50 a month to carry a listing here, there would probably be a lot more "tough love" with sellers.

Feb. National Existing Home Sales Data Released

Yesterday, the National Association of Realtors (NAR) released its existing home sales data for February. After three months of rising sales numbers, February's sales tally fell of a cliff, with the seasonally adjusted annual rate of sales falling 9.6% from January. In the northeast, the seasonally adjusted annual rate was down 7.2% from January, and off 8.3% from a year earlier.

On the price front, the national median sales price was down 5.2% from February 2010, and in the northeast, the year-over-year figure was down 9.5%. NAR noted in its summary that 39% of sales nationalwide were either foreclosures or shortsales. Sales appear to be strongest in areas where a large number of foreclosures have driven prices down. For example, in Miami sales were up 46% year over year, while prices fell 18%! All-cash sales nationwide hit a record 33%. This points to a significant percentage of sales are from investors swooping in to pick up distress inventory in desireable high foreclosure markets.

What's notable in looking over the data for the past year is that while some months show moves up in volume and/or price, those spurts of momentum aren't sustained. It's like a buoy bobbing up and down on a wave. Without that sustained momentum, buyers don't have confidence that the market hasn't hit bottom. As a result, if they're motivated to buy, they want to minimize their risk by focusing on the best priced properties within the category of what they're looking for. They're not stretching and aren't willing to take risks, which is a big reason we're seeing such lackluster sales here at higher price points.

Those Oh, So Special Houses

Over the past 10 years I've had the pleasure of selling dozens of very nice houses, and the privilege of selling a handful of truly special ones — those houses that have a soul that goes beyond charm or a setting that takes your breath away. Much to the surprise of shoppers, these houses are exceedingly rare. like 12 point bucks. I seldom see more than 3 or 4 on the market a year, and sometimes less. I get truly excited when I have a client to show them to. When one of these houses is sold by another broker (like a house perched above the Callicoon Creek that closed last week), I feel a tinge of disappointment. Not so much because I didn't make the sale and commission, but because I don't have the house to show anymore.

I've sold about 150 houses here over the years, but I can count on two hands the ones that fit the "Oh, So Special" category. There was a Craftsman bungalow overlooking Hollow Creek, a Victorian-era hunting lodge in Mongaup Valley, a tiny mid-century ranch with it's own private lake south of Livingston Manor, a riverfront cottage on the Delaware River north of Callicoon, a log home at Amber Lake with spectacular views (the header photo on my website is from the deck), an original lakefront log cabin on Lake Muskoday, a modern home perched on the top of a hill off of Stewart Road and two farmhouses, one in the Beechwoods and one on East Hill between Jeffersonville and Youngsville. I also remember some of the ones that got away, like a stone house off of Debruce Road east of Livingston Manor, a Craftsman lodge on Old Brook Road, the old winter clubhouse at Merriewold and an original summer cottage in Mamakating Park near Masten Lake.

These houses aren't necessarily the most expensive houses I've sold, and seldom the largest. The most expensive were two that sold in the $600's. Most were in the $300's and one was in the $200's. None, though, was in the "super bargain" category. There were other houses with similar specs, in terms of size and acreage, available for less, but without that special something that made these places unique. The buyers of these houses all appreciated that specialness.

Nirvana for me would be to have a dozen of these houses on the market at any given time to show. But usually there are only a couple. In today's market, buyers are intensely budget focussed and often overlook these unique properties because they're never bargain priced, even though they are priced less than they would have been at the market peak.

One property I particularly like at the moment is a "compound" (main house and guest house) at Merriewold. The Merriewold Club is this really unique lake community in Forestburgh Township that was formed in the late 1800's. Early 20th century notables like John Moody and Agnes Demille had their summer homes here, as did Neil Sedaka during the heydey of the Catskills. The place just oozes charm, and I can't think of anyplace else I'd rather be on a summer evening than having a beer with friends on the deck of the summer clubhouse there overlooking the lake.

Merriewold harkens back to an earlier, gentler era. Residents have use of a 60 acre lake, a nine hole golf course, clay tennis courts, and hundreds of acres for hiking and cross country skiiing. While Merriewold is certainly special, it isn't cheap. This property, for example, which isn't lakefront, is on the market for $459,000. Second home shoppers looking to spend in the $400's can find something similar sized that is lakefront elsewhere for the same amount. But it won't have the "soul" of this house, or of Merriewold. (Click here to see a full listing for this property with additional photos.)

When dealing with these special properties, pricing is always a challenge. If someone is hell bent on landing a bargain, there's no point in even entering into a dialogue. They don't get it. An anaology would be deciding on a sweet treat to buy. I can go to Shoprite and buy a whole pudding cake for $3, or can go to a fine chocolate maker like Jacque Torres and buy a single truffle for the same $3. I tend to be someone who would go for the truffle. In today's market, there are a lot of pudding cake buyers, but not a lot of truffle appreciators.

One last point. The number of truly special houses on the market is quite small. I want to emphasize that unique houses that may carry a premium are not the same thing as less special properties that are simply overpriced. There are a lot of sellers today that think they're selling a truffle, but really they're selling a fancy pudding cake.

Current Market Conditions Posted with February Data

I just posted the March Current Market Conditions Report for Sullivan County Real Estate with sales data through February. Sales volume remains soft, although prices for the latest 3 month period are on par with the same period a year earlier.

Note that this month I've made a change in the data methodology. Previously, I only pulled sales data from the Sullivan County Multiple Listing System. Starting this month I am also bringing in data from the neighboring Greater Hudson Valley MLS for sales in that system in Sullivan County. I've made this change because the percentage of sales only handled through the GHVMLS, and not also included in the Sullivan MLS, has been increasing. I've made this change to provide a more accurate picture. I've compiled the sales data from the two systems going back 15 months, to enable year over year comparisons. But note that archived reports prior to this month only include data from the Sullivan MLS.

Please check out the latest Market Conditions Report and then drop on back and leave your comments on what you see happening in the real estate market here in Sullivan County.