Happy House Hunting: Local Prices On The Decline

Those living on Long Island or who have grown up here have generally always lived in the lap of luxury. After all we are right smack dab in between the glitz and glamour of Manhattan and the infamous, fame-filled East End (a.k.a.: The Hamptons). And, where else can you drop about a half a million dollars on a Levitt or Hicksville home?

But, it looks like life on Long Island may be getting easier; at least for some Nassau County home buyers.

According to officials, home prices in Nassau are noted as having dropped by about 4 percent or approximately $20,000 from last year, based on statistics from the Long Island Multiple Listing Service.

Suffolk County residential prices however, have seemingly “stabilized” at an average of $402,800, an amount just less than one percent above last year. And, Queens prices actually rose by 5.8 percent with the average price quoted at about $490,000.

Industry leaders say that even more important was the difference between the steady increase in inventory (approximately 50 percent annually) and the decline in actual sales. These figures were notes at 20 percent for Nassau and 24 percent for Suffolk.

Also, according to officials, the gross dollar volume of sales closed is currently 6.5 percent lower than it was a year ago, a decline, they suggest could have a domino effect on the economy.

Experts suggest that real estate has been a key economic force here on Long Island for the past 5 years, perhaps even the last decade, and the impact of the housing market could also mean a slowdown for the overall (local) economy, including spending and jobs.

Some professionals in fact predict an 8 percent price decrease in the next two or three years. Yet, other experts expect the impact to last only through the winter.

They note a “fearful” public combined with a change in market and the advent of the holiday season, all which will have an impact on the housing market. However, one the spring hits, some anticipate that inventories will come down, and we’ll begin to notice a stable and solid real estate market.

Still, some statistics suggest that that view may be too optimistic, as they suggest it would take about 13 months for the homes listed in Nassau and Suffolk Counties, as well as those up for sale in queens to sell at the current asking rate. The numbers also suggest that currently Nassau has an 11-month supply of homes as compared to about a 6 or 7-month supply two years ago.

And, that say experts, is because some areas have not yet seen (much of) a decline and prices may in fact be rising. And, they suggest that negotiations WILL be necessary.

Furthermore, they add, that in lieu of taking comparable sales and adding a premium, sellers must educate themselves on discounting the comparable homes sales they see.

The issue, according to industry experts, is that both buyers and sellers are following, what they term a “herd mentality”. At the peak of the boom, buyers paid top dollar just to get the house they want, and now the opposite is true. Still, experts suggest “caveat emptor” because there tend to be ideal deals that pop up regardless (of the market).