February 22, 2011
Today's Real Estate Forecast
By Joe Monaco
Real estate in the news today has been dominated by the insights and findings of the S&P Case -Shiller index of 20 large metropolitan areas across the nation. The Case-Shiller index, a unique and comprehensive analysis of the real estate market, has become a single favorite of most major media sources and companies.
Just as real estate differs from location to location, and is as local and different as the weather forecast from Yorktown to mid-town, so is the spin on the subject matter we get from the media. My review of this most recent Case-Shiller index from various sources ranged from doom and gloom to hope and positive signs of recovery.
The collective data of the S&P Case -Shiller index of 20 large metropolitan areas puts a dark cloud over our nation's real estate market, this most recent report is based on data comparing November to December 2010 pricing. One month, by no means is a trend in real estate, but the negative media and perception of a declining market instills a strong fear in today's real estate buyers.
Real estate is a local market and business. Buyers and sellers need to obtain and understand local data and not be swayed by wide geographic analysis.
The following data clearly illustrates the variances in local and regional markets from Las Vegas to Westchester County, New York.
In Las Vegas, it has been reported prices are down nine percent from last January. Half of all homes sold were cash purchases and a staggering three quarters of a percent were vacant. This market has been mostly driven by investors buying short sales and foreclosures sold by lenders at discount prices.
In the greater Yorktown area of Northern Westchester, our market was flat in unit sales and prices in 2010 from 2009. Unit sales dropped to 459 from 467 and the average sales price declined $1,076. from $417,219 to $416,143. 2010 market performance in Yorktown provides strong promise that the market is stabilizing, a necessary prelude to recovery.
In lower Westchester, the market experienced a rebound in 2010 in both unit sales and prices, propelled by lower property values from the market highs of just a few years ago and proximity to Manhattan. Some locales had a 40% increase in unit sales and a 15% increase in the average sales price in year over year comparisons.
Meanwhile, Westchester County total sales data, year over year, are pointing to a path of recovery. Unit sales were up by 5% and the average selling price increased nearly ten percent to $851,124 from $775,756 in 2009.
As you can see, the market performance is local and can vary significantly as indicated by comparing just Northern Westchester with lower Westchester. Many factors are involved in evaluating market conditions and the value of residential real estate, most specifically and important is local market data.
Although, many political and economic factors are involved in forecasting real estate's future, real jobs, consumer confidence and financing are the factors that influence consumer real estate decisions.
Today, the American dream of homeownership is alive and well in Westchester County. Now's the time to buy, I truly believe it, so much so that I assisted two of my daughters who have purchased homes in the last six to nine months.