Lay of the land

We asked the region’s leading real estate professionals to share their insights on the most pressing questions on everyone’s minds.

imageHas the fed tax credit helped to get the market moving?
Absolutely yes. Transactions on Long Island have grown significantly over the last year and we have entered the first stage of the broader market recovering. New contracts to purchase homes are up over 20% from the start of 2009. The greatest increase in sales has been at the lower end of the market (under $500k) in that price range the tax credit has had a big influence.

Have prices hit rock bottom yet? If not, when will they?At the lower end of the market (under $500k), yes. Prices have totally stabilized and are inching upwards. On the upper end (Over $1.5m), prices are still softening but at a slower rate.

What do you foresee as the next peril in the real estate market?
The next or continued peril is the “Shadow Inventory” that will be coming to the market. Those properties are the short sales in the pipeline and foreclosed properties. Reports indicate that this inventory will grow over the next 24 months and will continue to soften prices. However they sell very quickly so transactions will continue to grow and stay robust.

Is now a good time to buy an investment property (second home, vacation property, etc.)?
The time to buy a vacation or second home is excellent. Firstly, the prices are down over 20% from just a few years ago and secondly, mortgage rates are still at historic lows and are projected to move higher by the fall. The time to buy is now.

What’s the biggest regret you’ve seen a buyer or seller have?
The recurring regret that many sellers have is that they turned offers down last year that were 5 to 10% higher then the offers they are receiving today.
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image Has the fed tax credit helped to get the market moving?
It had a greater impact elsewhere in the country, but bolstered buyer confidence here. As the first-time homebuyer’s market improved, so did the “move up” market, generating a positive effect on Long Island’s overall residential market.

Have prices hit rock bottom yet? If not, when will they?While there is no such thing as “rock bottom,” the answer is likely yes. Realistically priced properties are selling. For those with a good job and good credit, the coming months represent the time to buy before rates increase.

What do you foresee as the next peril in the real estate market?
Peril is too strong a word. However, we do see an increasing number of foreclosures, and a strong probability of increasing mortgage rates, which will “challenge” the market.

Is now a good time to buy an investment property (second home, vacation property, etc.)?
Yes. We have good prices, a great selection and very favorable mortgage money. The answer to the question is less about investment and more about quality of life to second homebuyers.

What’s the biggest regret you’ve seen a buyer or seller have?
Now is one of the best opportunities to buy! Some buyers still expect substantially lower prices, and will continue to let the “right” houses slip through their fingers.
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imageHas the fed tax credit helped to get the market moving?
In the entry level primary home housing market, which is not a huge part of our business in The Hamptons, it certainly is a factor for those people buying their first home enabling many to finally have a home of their own.

Have prices hit rock bottom yet? If not, when will they?
Just when you think you’ve seen the bottom of the market, it’s already too late and the prices have gone up again. It’s almost impossible to determine where the bottom is and it is always best to try and find those properties that seem to be a relatively good buy in relation to recently higher prices.

What do you foresee as the next peril in the real estate market?
Reality TV shows showing brokers and buyers emanating from The Hamptons!

Is now a good time to buy an investment property (second home, vacation property, etc.)?
Absolutely. With the perfect storm of conditions including increased inventory, lower prices coupled with more negotiability and relatively inexpensive mortgage money, there couldn’t be a better time to find that house you’ve been looking for.

What’s the biggest regret you’ve seen a buyer or seller have?
For certain buyers it’s thinking a property would be on the market forever and they would have more time to wait for a price drop and then seeing it sold out from under them without the benefit of additional inventory to compensate. For sellers, it’s missing an opportunity to snag a buyer because they had unrealistic expectations due to an over emotional involvement in their properties.