Hold…or Fold??
February 7th, 2009 category: Real Estate News, Sellers
There is no question but that the real estate market is correcting. While this has occurred in past markets (that “cyclical” thing is the truth) the degree to which values are declining makes this market urgent for sellers, and here’s why:
Banks have stopped up the foreclosure process by providing government mandated time extensions to homeowners. Many of these homeowners, in the absence of an alternative that makes sense, continue to miss payments. Eventually, their homes will hit the market as “bank owned.” As is.
At a price significantly below what would have been an expected (hoped for) price.
This discounted property (there are homes that would fit into the 400k range now, being offered in the low, low 300’s/high 200’s as bank owned) is now a comparable property for the “regular” home seller, either in “available” comps, or if closed, closed comps. They’re part of the real estate landscape, and we are at the beginning of bank owned presence. One look at Florida and California tells the story, with 50% valuation drops.
Whether or not NY will become hard hit is irrelevant if it’s being hit (which it is). If lis pendens are any indication, we just got on the ride; Long Island is already a harbinger of bank properties. The Wall Street news doesn’t bode well for a community with a large second home presence.
With appraisers feeling an industry wide sting for having been a part of a many faceted problem that was inclusive to varying degrees of all real estate participants, any expectation that an appraiser is going to fudge a bit is out of the question. If anything, valuations will likely fall on the other side of a hoped for amount.
The more distressed properties that close, the lower the values go- this includes short sales, which are being attempted in abundance on the east end of Long Island. Once closed, a seller has a new “comp” to contend with.
If you need to sell your home, the advice from this contingent is to get it marketed as soon as possible. Don’t hold off to “fix it up” at this point- and if you are going to make improvements, do it speedily. As distressed properties increase, and those closed figures impact the VALUE of your house, time is not on your side yet.
If you’re a gambler, it’s time to look at the odds of coming out ahead in the near future, and make decisions based on facts.
If you don’t need to sell your house, look forward to a few additional east end summers…I can think of worse things!
To search available homes for sale on the North Fork / East End Long Island or condos on the North Fork of Long Island, click “north fork homes”, enter your area of interest and any parameters, and click “go”- properties for sale include Riverhead, Aquebogue, Baiting Hollow, Calverton, Jamesport, Laurel, Mattituck, Cutchogue, Peconic, Southold, Greenport, East Marion, Orient, and Orient Point, NY.
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