REGION — High prices, low inventory, bidding wars: There’s been a scramble to buy properties in our bucolic area for the past year or two, and according to local real estate brokers, …
REGION — High prices, low inventory, bidding wars: There’s been a scramble to buy properties in our bucolic area for the past year or two, and according to local real estate brokers, there won’t be much happening to change that tune.
The Upper Delaware area has always been a favorite vacation spot. But when the COVID-19 pandemic hit, our fresh air, wide-open spaces and low density soon became hot commodities, real estate agents said.
“It’s been a sellers’ market since 2018, but the pandemic greatly increased that,” said Dawn Curreri, broker/owner of Eagle Valley Realty in Narrowsburg. “People still want to escape from the city, with its tight quarters and little or no yards—they want to come to the country.”
Debbie Jagel, broker/owner of Cabins and Canoes Real Estate in Forestburgh, agreed. “People are worried about keeping themselves safe. It sparked their realization that they could live where they wanted and work from home. The pandemic was the striking of that match.”
Statistics bear that out. According to OneKey MLS, the median sales price of a home in Sullivan County in January 2018 was just under $120,000. It climbed steadily through mid-2020 to $160,000. By mid-2021, it was scraping a quarter-million dollars.
Curreri expounded on that. “In June 2021, the closed median sales price in Sullivan County was $248,500. In July 2021, the closed median sales price in Sullivan County was $275,000, an increase of 10.7 percent.”
Agents across the area concurred that the market has been on fire.
“Sales were very good here during COVID 2020 and into 2021,” explained Joy Romano at Malek Properties. “I have sold homes with just a video. Some buyers were buying or making offers just by watching the video. A buyer didn’t even enter the home until after closing, in one case.”
Along with the hot market, bidding wars became more commonplace, brokers said.
“I’ve worked in real estate 35 years, and this is probably the most aggressive market I’ve seen in terms of buying,” said Bill Cole with Milford, PA-based Davis R. Chant Realtors. “In March and April, not only were there bidding wars, but prices were bid up over the asking price. I’ve seen bidding wars before, but not to that degree. At the end of March and beginning of April, I had a property that went on the market on a Friday afternoon: By Sunday, there were six offers and it sold for over its listing price.”
He added that low interest rates helped fuel the fire.
Romano said the market opened the eyes of some weekenders who ended up selling their homes in the city and moving up here permanently. And other city residents who cannot afford to buy up here are renting for the time being, she said.
That’s had an effect on rental inventory, as well.
“Rentals have gone up in price, particularly because of the lack of available homes for rent,” said Carol Malek, broker/owner of Malek Properties. “I would say most [rent prices] have gone up by about 15-20 percent. In some cases, landlords have asked for 50 percent more; however, they are displacing the tenants who are there because the local tenant population cannot afford that kind of increase.”
The hot market was unusual for this sleepy area, some agents said.
“I’m from Chicago, and it felt like I was in Chicago,” Jagel said. “This week alone, I had seven sales. This was the first time 20- and 30-somethings got into the mindset of ‘We could buy for less than renting in the city.’ Up here, that generated numbers that realtors weren’t used to. The average market time here was three to four years. Nationally, it is six months. Now, up here, we’re closer to that.”
The pandemic had a ripple effect. “People came here to live in their second homes, so they took properties off the market,” Malek said. “Many homes were rented at premium prices during 2020; as people could work from home and attend school from home, they lengthened their stays even in short term rentals. Some people stayed for months in places that were typically weekend rentals. There were fewer people able to list their homes, because of the virus and the inability to move to other locations.”
Home inventory continues to be relatively small. So what happens when you’re looking for a house in a particular area and just can’t find what you want?
You start from the ground up.
“Land is selling well—that’s what happens in a hot market,” Cole noted, “and now land inventory is relatively small.”
For some homeowners, however, the hot market reignited dormant ideas to sell.
“Some of the listings that were sitting on the shelf, this year was the time to dust them off and get rid of them,” said Callicoon Real Estate broker/owner Rosie DeCristofaro. “People are willing to part with a lot more money than we had ever seen before. I’ve sold properties for a half-million dollars that, a year and a half ago, I’d had doubts we could get $275,000 for them.”
That doesn’t mean buyers are snapping up any old house, DeCristofaro stressed. “The millennial crowd has certain tastes, and that taste comes with a price tag. I have two millennials at home who think I live in a cluttered home. Their taste runs to: No cabinets in the kitchen, just shelving… and meanwhile I’m thinking, aren’t those dishes going to get dusty?”
Another important factor is one that’s on the federal agenda as much as it is the local one: Rural broadband.
“High-speed internet is almost a given, like any other utility such as sewer and water,” Cole said. “People need internet now so kids can attend school, but they also need it to shop and do their banking online.”
“With what we have up here, the distance from the city and the distance between homes, the pandemic made people realize and made employers realize: why rent floors and floors of office space when everyone can just work from home?” DeCristofaro said. “We need to work harder to get broadband to the rural areas. Clients need the ability to work and go to school from home.”
And what should potential buyers do?
“Some of the first-time buyers who are being priced out of the market and do not need to move now might be better off waiting,” Malek said. “We know that foreclosures will enter the marketplace again and therefore there will be more competition that may force prices to come down. Interest rates are expected to go up too eventually, so that should also have an impact.”
So what does the future hold? Brokers are hesitant to predict.
“It seems like it may be evening out, as far as a buyers’ or sellers’ market, but that can change at any moment with what is going on,” Romano said.
“It’s as hot today as it was last year; not everybody bought houses last year,” Jagel said. “Now, this pandemic is amping up again. There’s no springtime market—we live in a resort area. We are full-time continually working.”
Will the market correct itself, and will prices stabilize? Definitely, said the agents.
“Based on my experience, there’s always going to be a correction,” Cole said. “Anytime you have this unbridled growth, it inevitably leads to a correction.”
“It remains a strong market now, and prices have increased, so we are suggesting that if you want to sell your home, now is a great time—the interest rates are still low and people have money,” Malek said. “The buyers are a little pickier now than they were in 2020, and they can be as more things come to the market. There is not that ‘frenzy’ or ‘fear factor’ anymore, but people still want a place in the country.”
“Although I believe this is a paradigm shift, not a bubble, I think there will be a correction,” DeCristofaro concluded. “But overall, the Catskills have made a comeback.”