Curt Darragh

Foreclosure!

• 1,188 sq. ft., 1 bath, 3 bdrm 2 story "Raised Ranch" - MLS® $199,000

Lagrangeville, Dutchess County - **Foreclosure**

Handyman special! Great opportunity to bring this wonderful Raised Ranch style home back to life. Offers a two-tier deck, aboveground pool, attached two-car garage and a basement ready to be finished. Needs lots of work, tree damaged the roof. Sold as-is.

Property information

Here is the latest market stats for Dutchess County NY:

As you can see the market has taken a strong decline. Sales are down, selling prices are down, days on market is up. The statistics were similar for July as well. Most of this can be accounted for due to the First Time Home Buyer Credit which expired earlier in the year. It altered the natural supply and demand. Unfortunately it appears as if the banks have begun adding more REO inventory to the market due to the high default rates. This will keep this artificially bad market moving in a downward direction. I expect prices to continue to decline well into 2011.

With rates still at all time lows, I expect the next six months to provide great buying opportunities for first time home buyers as well as move up buyers.

Congress has passed a bill extending the Homebuyer Tax Credit closing deadline to September 30, 2010.
The extension applies only to transactions that had ratified contracts in place as of April 30, 2010, and have not yet closed. There will be no gap between June 30 and the date the President signs the bill into law.

The question is will this matter... the answer? Not really. Yes this will help those buyers that met the April 30th deadline but are having a difficult time closing. This is a good thing. But since a buyer already had to be in contract, this will not stimulate any future purchasing.

In my opinion the home buyer credit did nothing to stimulate the real estate market. Did sales increase during the program? Yes, the numbers will support that. But it did it artifically, there was no change in the market itself, therefore the rules of supply and demand will take over once the deadline has expired and we will see the market drop even lower than expected. Why... because we took the demand in the market and artificially moved it it forward, but the demand did not change. Therefore the home buyers credit will create a vacuum and the real estate market(s) will free fall until they come back in line with the natural demand in the market.

The moral of the story... Hang on kids, this bumpy ride isn't over yet!

Statistics... funny thing about numbers, if you're not careful it's very easy to mis-understand them! Earlier in the year I made a post stating we may be nearing the bottom of this down market. The average number of sales was only down 2.3% compared to the year before and the average sales price was actually up .10% for the same period (compared to the -26.9% in December).

We had been seeing a 24% decline (approx.) in average sales prices for months then it went up .10% in January '09. How come?

Did the new president cause the market to EXPLODE? Nope!
Did all those tax dollars spent to save the banks (TARP) finally trickle down? Nope!

Simple math, that's what happened. The average selling price in Dutchess County, NY is $372,413.00 (as of January 09). But we had something we don't often see take place, we had one home sell for $6,000,000. Yes, that's 6 MILLION DOLLARS! As you can imagine that skewed the average sales price. The reality is we are seeing signs this declining market is finally slowing. The number of homes for sale declined (less supply), the number of purchase offers is up (more demand) and the days on market is holding. All good signs, but in the end, the average sales price is still decreasing about -24% (year over year). So we're not out of the storm yet, but the sun appears to be peaking its head through. Lets hope the spring market brings a turn in prices.

February 2009 Sales Statistics

market statistics provided by Mid-Hudson MLS

After months of doule digit decreases in average sales prices, increases in inventory and days on the market we finally see some stabilization. Below are our current statistics

As you can see, closed sales is only down 2.3% which is a significant difference compared to the 26% last month. Now this may be a blip in the statistics, we'll need to see next months figures to know for sure but its a nice start!