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CNY Real Estate Cools Off

Property prices are not climbing as quickly as they had been; inventory remains limited

By Deborah Jeanne Sergeant

For a variety of reasons, the hot real estate market has cooled from its previous selling frenzy. 

Beginning in 2020, sellers typically received several offers on their home upon listing it. Buyers agreed to “as is” terms to hasten closing the deal and sellers could close quickly, with their homes spending few days on the market. 

That urgency to buy began to slow in the past several months, and property prices are not climbing as quickly as they had been.

“The median sale price is on an upward trend,” said Amber Spain-Mosher, New York state licensed real estate salesperson with RE/MAX Masters in Skaneateles.

She noted that the median sales price was just below $140,000 for homes in Central New York in 2019. That has ballooned to well over $180,000 by June of 2022, not including new construction; however, the rate of growth has slowed.

A smaller inventory of available homes is partly responsible for the price hike. Spain-Mosher said that 1,343 homes were for sale in October of 2020, but that number slipped to 928 by October 2021 and 858 by October 2022; a trend which she said is significant.

On an individual sale, the average property sale price has decreased, partly because of fewer offers submitted by potential buyers, according to Spain-Mosher, and also because the greater number of days that homes are spending on the market. 

Real estate agents “are slowly starting to see an increasing number of days on market, fewer multiple-offer situations where many people are submitting offers on one property — a bidding war.

“We’ve also started seeing price reductions, which have been almost nonexistent over the past few years,” she added.

She views sellers as the slowest party to respond to changes in a market. Of course, they want to get the most that they can for their properties — as much as neighbors who cashed in on the booming housing market months ago. But that ship may have sailed.

“Buyers’ mindsets are changing,” Spain-Mosher said. “They are more cautious, likely driven by increasing interest rates and a desire to not settle because they don’t want to have to move again soon. The buying process right now is exhausting for many buyers who are often spending months looking for a home and making several offers on properties before getting one accepted.”

In recent years, Spain-Mosher has seen buyers waiving inspections to make their offers more attractive. Those days may be over, as agents are starting to see buyers make one offer on a home lower than the list price with that inspection contingency.

“Sellers are negotiating or accepting the offers because they don’t have others,” Spain-Mosher said.

Despite the slow-down, sellers should still do well selling property this winter.

“It still is a sellers’ market,” said Thomas K. Elleman Sr., real estate agent with Howard Hanna in Manlius. “I don’t think the prices are as crazy as they were, but many houses still sell right away if priced right. It’s a sellers’ market in the winter as buyers still need housing.”

He encourages sellers to spruce up the small issues of presentation, such as minor repairs, landscaping and fresh paint. However, investing in costly home repairs and improvements may not pay off unless they are necessary such as replacing a bad roof.

Judy Winslow, licensed real estate broker for Hunt Real Estate ERA in Manlius, feels no concern about rising interest rates slowing the market further.

“Homes are still selling; it’s the American dream to buy your own home,” she said. “I bought a home in the ‘70s with 12% interest. People are always going to buy houses.”

Whether moving for a job, upsizing for a family, or downsizing at retirement, people have many unavoidable reasons to move.

Winslow thinks that the using the right networking strategies can help people sell their homes as the market slows, along with using creativity to set up deals that are fair and accessible to buyers.

From her side of the desk, she also works hard to follow up with sellers who a year or two ago mentioned to her they may consider selling their homes. Oftentimes, all it takes is the right timing and another house is available on the market.

“I think it’s still a sellers’ market, but not as strong as it has been,” said Faye Beckwith, real estate agent and co-owner of Freedom Real Estate in Hannibal. “It’s still low inventory. We’re experiencing the traditional seasonal slowdown. That happens this time of year. Most buyers understand they can’t get into a new home before the holidays. Our time from contract to closing has increased significantly.”

Typically, it takes about 60 days from sale to closing. Beckwith said that legal backlogs have held up some sales, as have whether the seller needs time to move out or if the buyer requires financing.

“Prices are stabilizing,” Beckwith said. “Seller expectations are high because of the last couple of years. We’ve seen major in fluctuation in property sales. With interest rates rising, buyers can’t afford the same amount they could even three to four months ago.”

Like Winslow, she remembers much higher interest rates decades ago — even 18% to 20%. And, that did not stop buyers from purchasing homes. But she has noticed that fewer people are making large down payments on their purchases and that many require the maximum mortgage for the purchase.

Despite this, “we’re very busy,” Beckwith said. “Inventory is still low and the good ones are getting snatched up. We’ve had a number of inquiries of people who are interested in building as we have a number of land listings but it’s becoming cost and time prohibitive. Some builders are booked for two or three years out. We also know a builder who has recently retired.”