What You Need to Know About the Local Real Estate Market - Q3 2018

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1 School District Data Multi Multi $,00 INVENTORY OF FOR SALE** $47,000 $,000 $0,000 $,000 $678, $8,0 $680,000 Local Market Update 7 4 MEDIAN SALE PRICE,0, , AVERAGE DAYS ON MARKET 1, CLOSED SALES Multi Multi Quarterly Data At-a-Glance Fast Market Facts The Difference Between and Co-Ops Why Us? What You Need to Know About the Local Real Estate Market - Q 018 In Q, the market felt like it was settling down some. That s rather refreshing after the spring frenzy that saw sellers rushing to catch the season s peak prices and the frustration of buyers who were still searching for that perfect home. prices. Softening means that home values may not increase at the same rate we ve gotten accustomed to lately. But that s not the same as falling or decreasing prices, it just means slower appreciation. There are several reasons for the subtle market shifts we are experiencing. According to the laws of supply and demand, prices appreciate most when supply is lowest. While supply has not increased sufficiently to meet demand for the most desirable properties, it has risen in some market segments. Where it hasn t, prices continue to increase, pushing some buyers out of the market. We have also seen overly ambitious sellers at all price points who have chosen to list their homes at prices the market won t sustain. With buyers rejecting those overpriced properties, they are sitting on the market and ultimately selling at lower prices than if they d been priced correctly from the start. This gives the impression of a slower market which plays on the psyche of potential buyers and sellers. Additionally, there is the factor of rising interest rates which affect affordability and, here in Westchester, the uncertainty of how the tax law changes will affect property owners whose taxes exceed the new caps for deductions. On the international front, there is currently less money coming into the U.S. from China for the purchase of real estate, affecting major metro areas, slowing down the NYC market which does have a trickle up effect on Westchester. Current tariffs on Canadian lumber, unless re-negotiated, are making the cost of home building more expensive. Sales and prices remained strong. Some of the inventory issues that we experienced earlier in the spring and summer started to mitigate. While overall inventory is still in short supply, there is slightly more on the market now in the mid-range price points; perhaps because many buyers have now purchased, or because prices have been rising along with interest rates, moving some buyers out of the market. The abundance of high-end inventory is subsiding somewhat. Sellers whose overpriced listings were rejected by the market have either taken substantially lower offers in order to sell, or simply taken them off the market for now. Recent media reports about the housing market can be confusing, especially if you only read the headlines. Those have ranged anywhere from mixed results to predictions of a pause in the market. You ve probably heard the old adage that real estate is local, and it s so true. Even locally at the County level can differ from individual communities, neighborhoods or even streets. Overall trends are certainly important, but if you want to know how what s happening is impacting your personal property value or your ability to purchase a home, consult a reputable and knowledgeable real estate agent to help you decipher the data. We d like to provide some clarity here with regard to our local market, albeit on a general level. As things settle down, there is always the fear that the market is about to take a dramatic drop. With these fears have come rumblings of weakening buyer demand, higher inventory and falling home prices. Perhaps it s flashbacks to the housing crisis of over a decade ago, or some underlying belief that things can t be so good for so long. While we don t have a guaranteed crystal ball, we are not expecting anything dramatic like that to happen here in Westchester in the near future. What we may start to see are softening home prices. Softening prices are different than falling On the flip side of some of these concerns, there is historically low unemployment, steadily positive consumer confidence, and interest rates that, while higher than a couple of years ago, are still some of the lowest in memory. Westchester properties will always remain in high demand based on our proximity to NYC and fantastic quality of life. While we may see pullbacks or shifts at times, our housing market possesses innate strength and resilience. Prices are not decreasing, home sales are still strong, and Westchester s real estate market is just fine! 1

2 Homes Under Contract and Closed Sales* SCHOOL DISTRICT Ardsley Bedford Blind Brook Briarcliff Manor Bronxville Byram Hills Chappaqua Croton-Harmon Dobbs Ferry Eastchester Edgemont Elmsford Greenburgh Hartsdale (P.O.) Harrison Hastings Hendrick Hudson Irvington Katonah-Lewisboro Lakeland Mamaroneck** Mount Pleasant Mount Vernon New Rochelle North Salem Ossining Peekskill Pelham Pleasantville Pocantico Hills Port Chester Purchase (P.O.) Rye City Rye Neck Scarsdale Somers Tarrytown Tuckahoe Valhalla White Plains Yonkers Yorktown UNDER CONTRACT UNDER CONTRACT Previous qtr SOLD SOLD rd qtr 0 MEDIAN SALE PRICE $71,00 $747,00 $,000 $47,0 $,180,884 $1,,000 $6,0 $6,00 $86,000 $76,00 $1,1,000 $480,000 $4,000 $6,000 $1,,00 $86,000 $480,000 $1,060,000 $681,70 $,000 $1,,00 $6,0 $4,000 $70,000 $48,000 $47,000 $0,000 $1,0 $7,00 $1,47,00 $,000 $1,684,800 $1,787,00 $,000 $1,4,000 $4,70 $6,000 $84,000 $11,000 $708,000 $0,000 $44,00 MEDIAN SALE PRICE rd qtr 0 $7,6 $687,000 $06,000 $77,000 $,667,00 $1,080,000 $0,000 $6,00 $,000 $70,000 $1,08,00 $4,000 $,000 $67,000 $1,,000 $8,0 $4,70 $8,00 $6,70 $1,00 $1,0,000 $60,00 $,000 $71,000 $1,000 $44,00 $80,000 $,000 $8,000 $78,00 $06,000 $1,000,000 $1,,00 $1,100,000 $1,6,000 $48,70 $7,00 $70,000 $77,000 $680,000 $,000 $0,000 % CHANGE YEAROVER-YEAR -1.80% 8.74%.%.% -18.% 1.8%.4% 4.0% -6.81% -1.80%.1% -.0%.8% -7.% 1.0% 8.60% -.% 1.% 4.8% 0.8% 18.1% -6.18% 1.18% 0.70% -4.0%.% 8.7% -.8%.8%.% 4.74% 68.48% -8.4% -1.0% -1.84% 0.18% -4.18% 1.67% % 4.1% 6.1% -4.0% ACTIVE LISTINGS MEDIAN PRICE OF ACTIVE LISTINGS $7,0 $0,000 $84,70 $18,0 $1,8,000 $1,0,000 $07,0 $7,000 $787,000 $74,000 $1,08,00 $6,000 $84, $647,00 $1,8,000 $784, $14,0 $64,000 $67,00 $4,00 $1,11,00 $644, $46,00 $6,00 $600,000 $4,111 $1, $1,00,000 $74,48 $1,0,000 $4,000 $1,4,000 $1,,000 $87, $1,7,000 $4,00 $70,100 $,000 $8,000 $71,00 $4,000 $, * Data sourced from Hudson Gateway Multiple Listing Service and sorted by school district unless otherwise noted. **Includes Larchmont P.O.

3 Quarterly Home Sales Report - At a Glance.* How was the Westchester Market in the rd Quarter of 018? Overall Sales Down.% Total number of sales, inclusive of all main property types as shown in detail in this report, are down.% compared to the same quarter one year ago. Total sales are up 0% since Q of this year, a typical seasonal jump reflecting homes that went into contract in late spring or early summer and closed in the rd quarter. No categories saw an increase, but multi-family home sales saw the largest decline at.%, followed by co-ops down 7.8%, single-family homes down 4.%, and condos down 1.%. Low inventory of properties in the most desirable categories and price points continues to limit sales. Prices Flat Year-Over-Year The median single-family home sale price of $678,70 in the rd quarter of this year is relatively unchanged from $680,000 as seen in the rd quarter of 0, and down 4.% from $710,800 in the nd quarter of this year. -family sales historically see their strongest sale prices in the nd quarter. Multi-family properties saw a significant gain, up.6%, with a % increase for co-op prices, and a 1.8% gain for condos. Overall sales continue strong. Prices reflect seasonal fluctuations and are the product of the law of supply and demand. How much negotiating room was there? Inventory Down.% Overall inventory ends the quarter down.% from the same quarter of 0, and down just over % from the nd quarter of this year. These drops are far less dramatic than some we ve seen over the past several years. For the second consecutive quarter, we actually experienced a modest increase in single-family inventory, up.% over one year ago. Active co-op listings dropped 7% over last year s same quarter, as co-ops continue to be scooped up by entry level and downsizing buyers. With younger buyers continuing to enter the market, and prospective purchasers staying focused on lower taxes and more conveniences, there is improving strength in the sales of more modest or investment properties. % of List Price Received -family homes sold for 8.% of list price in the rd quarter of 018, unchanged from last quarter, and down ever so slightly from 8.7% one year ago. This statistic has not dropped below 7% in the past years, continuing the pattern of strength typically seen in a low-inventory market. Many of the most desirable properties are seeing multiple offers and selling at prices over asking, so those buyers have very little room to negotiate. * Per data provided by the Hudson Gateway Association of Realtors

4 Fast Market Facts, Year Over Year, Q 018, Westchester County.* AVERAGE DAYS ON MARKET 1, 1, CLOSED SALES Multi Multi ,0 $,00, INVENTORY OF FOR SALE** $47,000 $0,000 $,000 $,000 $8,0 $678,70 $680,000 MEDIAN SALE PRICE Multi Multi * Per data reported by the Hudson Gateway Association of Realtors. ** Average monthly inventory of homes for sale. 4

5 The Difference Between and Co-Ops, and Why It Matters Are you thinking of entering the ranks of homeownership with the purchase of a condominium or co-operative apartment, or perhaps downsizing from a larger home into something more manageable with less maintenance? If so, you should fully understand the differences between these two property types before you begin shopping. The type of property you purchase has several implications, from your tax benefits to your ability to rent the property should you decide to move again to available financing options. and common elements is held by an apartment corporation. Unit owners purchase shares of stock in the corporation and obtain a proprietary lease for the unit and a stock certificate representing the number of shares owned. It is technically the purchase of personal property rather than real property. As stockholders, unit owners elect a Board of Directors to oversee administration of the building. The by-laws of a co-op typically give the Directors the right to approve/ disapprove of prospective purchasers, in accordance with anti-discrimination laws, since all owners are financially vulnerable if other owners default. The by-laws may also limit a shareholder s ability to rent their unit because higher rental ratios can affect the tax status of the entire property; this can result in higher owner occupancy rates than condos. Unit owners pay monthly fees that cover maintenance and management costs, as well as the corporation s property taxes and the underlying mortgage on the building. The portion of the monthly fee that represents the property taxes and underlying mortgage interest is tax deductible for the unit owner. Even though co-ops are considered personal property, for income tax purposes the IRS allows co-op owners to also deduct the interest on a co-op purchase loan. Values per square foot for co-ops are generally less than for condos and settlement costs are often lower. However, the purchase of a co-op often requires a higher down payment (as established by the coop s by-laws or the lender) and the pool of potential lenders for a co-op loan may be smaller than for a condominium mortgage. CONDOMINIUM OWNERSHIP The owner of a condominium has a fee simple title, the same as for a single-family home, and deed to the individual condo unit as well as an undivided interest in the common elements of the property such as the land, walls, hallways, roof, pool, clubhouse, etc. A prospectus or offering plan defines the common elements and describes the individual units. The condominium bylaws define the operating rules and establish procedures for an elected Board of Managers to oversee operation of the condominium. A monthly association fee is paid by the condo owners to cover the expenses of maintaining and operating the common elements (not tax deductible). Real estate taxes on the unit are assessed to and paid directly by the unit owner (tax deductible). Mortgage interest on any purchase loan is also paid directly by the unit owner (tax deductible). Generally, a condominium owner may sell or rent their unit as they wish, although some condominiums do require that they re offered a right-of-firstrefusal before a sale is consummated. Condominium units exist in a variety of architectural styles, including buildings, attached, semi-attached and detached simplexes and duplexes. We'd be happy to answer any questions, and to help you determine which of these options may match your individual needs. COOPERATIVE OWNERSHIP In cooperative homeownership, the title to the land, building(s)

6 DUTCHESS COUNTY I-84 Route Taconic Pkwy Why Us? I-84 I-684 Mahopac Y C OUNT PUTNAM NTY R C OU HE S TE WE S TC Peekskill It is our sincere belief that we are only as good as how we represent each and every client and community that we serve. Our reputation is made and tested on a daily basis. It is with this keen awareness that we strive for success in the eyes of those we serve. South Salem Cortlandt Manor Katonah Route Cross River Mt. Kisco Hudson River Croton-onHudson Saw Mill River Pkwy We pride ourselves in being: Highly informed about the market Entrenched in our various communities Students of real estate who are always learning and teaching others Staunch protectors of the American dream and laws that protect that Among the most professional and ethical practitioners in our industry. What we take pride in are the things that benefit and make a world of difference to our clients. Our value proposition is different. Our caring and concern are genuine. The delivery and quality of our services are unmistakable. If you haven t already, we hope you will choose to experience all this for yourself so we can show you what we mean. If you are one of our loyal clients, we thank you for your patronage and trust. Westchester Real Estate, Inc. Regional Office & Relocation Center I-684 I-87 Briarcliff Manor D IEL RF I FA Pleasantville Armonk CO IC CT NE ON,C TY UN Pound Ridge Bedford Chappaqua Ossining Westchester Real Estate, Inc. is a truly unique affiliation of premier real estate companies serving the markets of Westchester & Putnam Counties as well as NYC. Our companies have conscientiously and diligently created their stellar reputations and success over years and sometimes decades. Our achievements are evidenced by the 0,000+ buyers, sellers, tenants & landlords who have chosen to work with us over the past decade, and by our consistent ranking among the top five companies in our marketplace. North Salem Somers Taconic Pkwy Yorktown UT Thornwood Hawthorne Tappan Zee Bridge Tarrytown Irvington RO C CO KLAN UN D TY Dobbs Ferry White Plains I-87 Rye Brook Hartsdale Ardsley Sprain Pkwy Hastings-onHudson Hutchinson Pkwy Scarsdale Harrison N Port Chester Rye Eastchester Mamaroneck Yonkers NEW JERSEY Bronxville Mt. Vernon Pelham Larchmont Long Island Sound New Rochelle BRONX NASSAU COUNTY QUEENS New York City BROOKLYN J. Philip Real Estate, LLC North State Road, Briarcliff Manor, NY 1010 (14) J. Philip Real Estate, LLC 1A Fifth Avenue, Pelham, NY 1080 (14) J. Philip Real Estate & J. Philip Commercial Group Route 6, Mahopac, NY 10 (84) 6-00 Mancini Realty 8 Route 0, Somers, NY 108 (14) Park Sterling Realty ½ Park Place, Bronxville, NY (14) Route 0, Suite, Somers, NY 108 (14) Info@HomesNY.com Peter J. Riolo Real Estate Main Street, Hastings-on-Hudson, NY (14) The Michael Shapot Team, Compass Real Estate NYC 0 Broadway, nd Floor New York, NY 100 (7)