bonnie koff logo

Warning

JUser: :_load: Unable to load user with ID: 549

2009 Westchester End of Year Review

After enduring three years of a declining real estate market, 2009 brought a much needed break for the hard hit real estate sector. Driven largely in part by the economic stimulus that helped the housing market emerge from the recession, it leaves many of us wondering what is next for real estate. Will housing prices rebound? Will the new extended and expanded tax credit be just what the doctor ordered? Will the luxury market recover similarly to the entry level?

How would you say the housing market faired in 2009?
Did it live up to your expectations or falter?
Although it was a challenging year, I believe that it ended up being a year of stability. It was a year of transition in many of our markets. We bounced along a rough bottom but at the same time, we are really prepared for a modest and consistent improvement. The second half of 2009 was when we finally saw a jumpstart. I think that really stems from consumer confidence. At the end of the day, what drives affordability is confidence. Does a buyer feel confident in his/her employment and finances? If so, then buying a home is typically a good option. Another way that the government is reinforcing the viability of buying a home is by offering the tax credit.

Do you feel the tax credit was an important factor in the market turnaround?

Undoubtedly, the tax credit was an important factor in our market's turnaround. We didn't really know this for sure until we started looking at the number of closed escrows in September, October and November. The number of properties that went under contract increased as we grew closer to November 30th, the original expiration date for that tax credit. It was a very clear indication that once potential buyers realized they might miss out on the $8,000, tax credit if they did not move quickly, many buyers got off the fence and began to act. The number of property showings was up. The number of properties that were sold was up. Then, we saw the extension of the tax credit and we saw yet another market adjustment. I wouldn't say that the market has been slowing, but there has been a softening of the frenzy. I think as buyers near the new expiration date of April 30, 2010 that they will once again begin to act.

Do you think the extended and expanded tax credit will solidify our market recovery?

Certainly the increased activity that we've had in the lower end market has been good; but in and of itself it probably will not create a market-wide recovery. To have a market- wide recovery, we have to be able to engage the move-up buyer. We have to remind the move-up buyer that now may be the best time in our history to step up to the higher priced homes. The new tax credit that provides existing home owners with a $6,500 tax credit is certainly helpful but many buyers need more than just a tax credit. They need to have the courage to step up in today's market. Those who do, may reap the best benefits. The fact is, you probably have never gotten as much value, thanks to interest rates and given what you're earning, as you have in today's market. Six months to a year from now, we probably won't be able to say the same. We are certainly recognizing that the tax credit is a great thing. But it isn't compelling enough if a potential buyer isn't confident in his/her finances or future employment. For those who are confident, the tax credit should serve as a clear and convincing message that now may be a great time to move-up.

Why is it such a great time to move-up?

It's all about the power of leverage. The fact is that in most markets, inventory is very low in the low priced home range. So buyers in that market are often competing against other buyers for the same home making it more of a seller's market. However, it is a buyer's market in the mid-level and upper end markets so you truly get the best of both worlds when you choose to move-up. There is a lot of talk about the impact of inflation. Do you think people should be concerned about it?

Certainly people need to be aware that inflation is very likely. The government has devoted a great deal of money to stimulate our economy and in order to strengthen our dollar over time, inflation will be likely. With inflation comes higher interest rates and ultimately less buying power for a home buyer. But it all goes back to maximizing your opportunities now, in today's market. For those who have made a fortune in their lifetime, they were always looking at the opportunity, today. In order to do so, you must sell where the market segment is strong and buy where the market segment is weak. Today that opportunity resides with the move-up buyer.

Another important fact to note is how advantageous interest rates are right now. Some buyers are able to qualify for 30-year fixed mortgages at under 5%.

Do you think we've hit bottom?

I think in many communities we probably have hit bottom. We are seeing statistical evidence of it in the average sale price and in the number of homes sold. Interestingly (and I think this may be contrary to what most people believe), the communities that may have hit bottom are not necessarily those that were hardest hit by foreclosures. The communities that are strongest today are those that are clearly most desirable. When the market gets soft, the people who in previous markets couldn't afford their first choice market had to settle for their second or third choices. But thanks to the opportunities in today's market, they are better able to buy into their first choice communities and neighborhoods. It goes back to supply and demand. Those communities that have good schools, good local economies, diverse activities and, overall, are just considered more desirable places to live, are once again driving demand.

What do you recommend to today's home buyer?

"Buyers need to understand right now that the market is a little schizophrenic. You know it is probably the time to buy and you also know that the market has been challenged. But you may see that in certain markets, we've had lower prices and decreasing numbers of available homes for sale. In that type of area, you might expect to get a lower price than a year ago. But you also need to realize that the market is picking up and that in many markets, we've probably hit bottom. For example, if you want to be where the best schools, best hiking trails and best parks are, that will probably be where the best recoveries are likely to occur. To properly ride the wave, you should find the houses where people want to be. The problem is that if you wait a year, you're probably going to run up against a lot of challenges: increased interest rates, increased buyer demand, and lower available housing inventory. The combination of those factors is what is creating more urgency in the more desirable markets today."

What do you anticipate for real estate in 2010?

What we're going to see in 2010 is probably the more desirable neighborhoods seeing a modest increase in sales price and a decrease in the number of homes on the market. I predict that we are going to see an overall stabilization in the marketplace. We are probably going to see on the whole a slight increase of the average sales price of homes. We're probably going to see a stabilization of the market. We probably won't ever return to the sales levels of 2005 and 2006 because so many of those sales were artificially created. Fortunately, I believe that we are now on the right path toward modest, sustainable growth.

When will the market begin its turnaround? What about the luxury market?

We should see a turnaround of the housing market in 2010. I believe the luxury market will be the last market to turnaround. It was the last market to experience a turn down and it will probably be the last market to experience an upturn. As business and the economy strengthen, we'll once again see a more robust luxury market.

The bottom line is there is a lot to be confident about in relation to the housing market: the tax credit; attractive interest rates; buyer demand in the entry level market; opportunities in the move-up buyer market; and sustainable growth. It all adds up to what we anticipate to be a very productive 2010.

If you would like more information about the opportunities that are available in today's housing market, This email address is being protected from spambots. You need JavaScript enabled to view it..

Mortgage News Daily

  • MBS RECAP: Might as Well Hit This Weekend With Some Hope

    Posted To: MBS Commentary

    By today, it became clear that bonds were fully locked into a sideways consolidation in a range defined by the highs seen on Wed/Thu and the lows marked by the 3.06% technical levels. Of the past 3 sideways days, today was the least volatile and most lenders saw fit to offer just slightly stronger rate sheets despite 'unchanged' levels in bond markets. Consolidations like this can happen simply because markets are catching their breath after a strong move or because they're settling down ahead of the next event that might cause a strong move. If we're dealing with the latter, the event in question is likely to be Wednesday's Fed events (announcement, press conference and updated rate hike outlook). Of those three, it's the(t "dots" he dot plot that conveys...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Best Day of a Rotten Week For Mortgage Rates

    Posted To: Mortgage Rate Watch

    Mortgage rates actually fell today, on average--something they haven't been able to say all week, or indeed at nearly any time during the past 4 weeks. Yesterday, in particular, was the worst day for rates since 2011 for most lenders, with anything less than an ideal loan scenario garnering 30yr fixed quotes of 4.875% to 5.0%. With all of the above in mind, today's token improvement isn't necessarily exciting, but at least it's better than the alternative. Much of this week's rapid rise was seen in the first half of the week. Starting on Wednesday afternoon, markets began settling into a more sideways pattern, apparently getting in position for more volatility in the coming week. If there's an event that's likely to serve as the catalyst for that volatility, it's the Fed Announcement on Wednesday...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Many Enlist, but Flood Coverage Still Falls Short

    Posted To: MND NewsWire

    Even as flood water continue to sit in living rooms and kitchens across a large swath of North Carolina it is clear that most of those homes are not insured against the damage. Mary Williams Walsh, writing in the New York Times, says that in North Carolina and South Carolina, which suffered less widespread damage, only about 335,000 homes in total have flood insurance. The Urban Institute (UI) reports that the number of policies homeowners purchased through the National Flood Insurance Program (NIP) has declined over the last ten years and the total is now just over 5 million nationwide. There are also some private insurance policies, but nowhere near enough to cover the affected homes. Sarah Strochak, Jun Zhu, and Laurie Goodman used data from the Census Bureau's 2017 American Housing Survey...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • MBS Day Ahead: Pain and Belief Radiating Across The Rate Spectrum

    Posted To: MBS Commentary

    More often than not, when I use the word "believe" (or belief), it's in some vague and positive context. For instance, something like "bond buyers are starting to believe again." That won't be the case today--at least not as far as the positive context is concerned. Today I want to talk about the beliefs that have radiated up from the short end of the yield curve over the past few years. They're like an infection that started in the toe but spread to more vital organs surprisingly quickly. The "yield curve" is just a fancy way of referring to the spectrum of time associated with various loans. The loans in this case are those taken out by the US government (via the Treasury Department) to finance all of its various spending. For instance, there are...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Investor Products; Mortgage Fraud Paper; Wells, PUF, BMO Harris Personnel Changes

    Posted To: Pipeline Press

    When I spent an hour interviewing Angelo Mozilo on stage last week for the American Pacific Mortgage Summit, one of the issues we discussed was the competitive environment for lenders, and the evolution of the mortgage loan originator. Angelo, who is very much in command of his game, is a strong believer in the strength of the relationship that originators have with their clients, and the future that originators have in the lending industry. Lenders always have their eyes on the horizon, watching the changing competitive environment, and along those lines I penned a piece for the STRATMOR Group titled “The Rise of the Credit Unions.” Fraud, Legal Chatter, Warnings Jonathan Foxx published, entitled “Mortgage Fraud Challenges: How to Catch a Crook.” “Tracking down...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • MBS RECAP: Not a Win, But At Least It's Not a Loss

    Posted To: MBS Commentary

    After a series of demoralizing losses, it feels like some small victory for bonds to simply remain sideways today. That wasn't necessarily a given early this morning. In fact, yields hit new intraday highs for the week--the highest levels since May. Move down the curve just a bit and 5yr yields are at the highest levels since 2008--just another victim of the relentless move toward higher short-term rates. All that to say that the biggest risks to the long-term rate outlook have yet to subside. Rather, today simply suggests we may finally be leveling off before making the next big decision--something that seems likely to follow next week's Fed Announcement and updated rate hike outlook. As for specific market movers today, attempting to pin the tail on any particular donkey is a fool's...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Mortgage Rates Trying to Stop The Bleeding

    Posted To: Mortgage Rate Watch

    Mortgage rates were mostly able to hold steady today, although they technically moved just a bit higher and that technically leaves them at the highest levels in 7 years. But hey! Let's focus on the positives... In terms of day-over-day changes, today was the best day of the week so far! To get an idea of where we are and why we're there, check out the last two days of commentary--always easily accessible here . As for today, it stands at least some chance to serve as the early stage of a ceiling for rates. Whether that proves to be true and how long such a ceiling lasts remains to be seen. In any event, next week's Fed announcement (Wednesday) has the greatest potential to kick off the next set of bigger moves. If volatility dies down between now and then, it would at least be better than...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Existing Home Sales Level Out After Long Decline

    Posted To: MND NewsWire

    It was a disappointment, but at least it wasn't a loss. Existing home sales, which were expected to increase in August after four straight months of declines instead remained unchanged from July. In fact, almost the entire report on August's existing home sales can be summarized by the word, "flat." Said sales of single-family homes, townhouses, condos, and cooperative apartments were at the seasonally adjusted rate of 5.34 million, identical to the July rate. Sales in July had fallen 1.5 percent below those from a year earlier, and that too was unchanged in the August to August comparisons. Existing home sales were selling at an annual rate of 5.42 million in August of last year. Econoday said the analysts it polls were expecting at least a modest increase after months of lagging sales analysts...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • Vendor Mgt. and POS Products; Upcoming Events; Ask a Lender's Sunset?

    Posted To: Pipeline Press

    This Saturday is the autumn equinox – season-wise, we know what is on the way. “Rob, we, like everyone else, are watching the approaching winter, and higher rates, and wondering if there are ways to improve our financial picture without laying people off or cutting LO comp. Heard of anything?” This is going to sound like a paid ad, but it is not. I refer folks to Riivos (ex-Alight). It’s a cloud-based application for mortgage companies, regardless of size, that “integrates with your core systems (G/L, LOS, payroll, etc.) to show where your BPs are going, what actions you can take to improve profitability, and insight into how those decisions ripple through the company and increase P&L.” They specialize in “what if” scenarios. IMHO, and my...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

  • MBS Day Ahead: Long-Term Trend is a Cheap Trick. Here's The Reality For Rates

    Posted To: MBS Commentary

    One of the themes we often revisit in times of trouble is the long-term bull market in bonds. This traces back to the 80's and provides a shockingly linear set of lower highs and lower lows in 10yr yields. Most recently, we've seen yields rise back to the upper boundary of the long-term trend. There's still a chance they could hold ground here, but any further weakness means an official breakout. One other reason to hold out hope is that yields are also at the top of a shorter-term uptrend (teal lines). This could offer some technical support of its own, but it should be noted that the current version of that uptrend is much less linear than the one seen from 2002-2007. Incidentally, I think all of this "big picture trend" business is just a cheap trick (one I've often...(read more)

    Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Residential Real Estate Sales

Westchester County, NY

 
Westchester Top 5 Real Estate

2009-2010 Top 5

Top Real Estate Agent Award

Westchester Magazine Top Realtor

2010-2011 Westchester Top Realtor

Westchester Magazine Top Realtor Award

For more information about fair housing practices, please visit the HUD website.


Bonnie Koff  |  Licensed Associate Real Estate Broker  |  William Raveis Legends Realty Group  | Tarrytown Office 
914-332-6300  |  37 Main Street, Tarrytown, New York 10591  |  Email