Selling a home is like riding a rollercoaster—there are ups and downs but it can be an incredible ride ending with a major payoff. But the first step is getting on the ride. Long Island’s market is proving to be a thriller as homes are selling faster lately—many spending 12 fewer days on the market than last year. Despite this, the number of available properties for sale is dwindling, indicating potential sellers are hesitant to dive in.
Laura Rittenberg, president of Coldwell Banker Residential Brokerage Long Island and Queens said the numbers could be deceiving. She indicated, “There is not a sufficient number of homes coming on the market to keep up with the buyer demand and that makes the pool smaller.” According to Multiple Listing Service Long Island (MLSLI), 6,026 fewer homes were listed Island-wide (including Queens) in June 2013 than the previous year.
Matthew Arnold, associate broker at Netter Real Estate in West Islip, said seller anxiety could also be a contributing cause of the limited stock. “Sellers worry about everything going smoothly, they’re anxious about the transition of moving to a new home [while selling their old one],” he said. “We incubate people for sometimes a year or two years before they list.”
Another fear keeping sellers at bay is that they might wind up selling their home at a loss. “People are uncertain because they think if they hold out, they’ll get a better price,” Rittenberg said.
But as rising interest rates reduce buyers’ purchasing power, “the buyer pool will start to go down,” she said. In the last year, she said the average home price appreciated between three and four percent. It’s a good sign, but the increase doesn’t necessarily indicate an ongoing trend and homeowners shouldn’t hold out in the hopes of larger profit—especially with buyers losing footing.
If there’s one thing that could strengthen sellers’ resolve, it’s competition among buyers. As fewer homes hit the market, bidding wars ensue, sometimes resulting in final sale prices higher than the asking price. “If [a buyer] finds a property they love, they have to keep in mind that a lot of people are also looking at it and there’s going to be a lot of competition,” Rittenberg said.
Bellmore resident Katelyn Corliss and her husband saw this firsthand when they started looking to buy their first home. “The first house we put an offer on was a cape in Lindenhurst,” Corliss said. “It needed a lot of updating, so we came in about $15,000 less than asking price. The sellers accepted a higher offer.”
Thus as purchasing power slips, the sellers are holding more and more of the cards. Enjoy the ride.