Local Housing Market Continues to Rise

Posted January 18, 2013

House prices climb in Southern Tier counties
By G. Jeffrey Aaron, The Star-Gazette (1/12/13)

Home sales and prices are poised to continue to rise throughout 2013 and extend the recovery that began last year, marking the end of a five-year slump brought on by the burst of the housing bubble.

Fueled by sales growth in the fourth quarter of 2011, home sales across New York state rebounded to finish only 3.9 percent behind 2010, a year when sales were inflated due to federal tax credit programs, the New York State Association of Realtors said. The statewide median sale price in 2011 remained stable through the year, building hope for an improving market in 2012.

But as the recovery continues into 2013, there are unique factors within each individual market — such as housing supply and demand, joblessness, consumer confidence and other economic factors — that could have a direct bearing on the strength and duration of the rebound.

“The fundamentals that we saw in 2012 are continuing, but there’s always concern about the great unknown,” said Sal Prividera, spokesman for the state Realtors’ association. “We avoided the fiscal cliff but things very important to homeowners in New York state are still on the table.”

For example, Prividera said the state association is against any changes to the mortgage interest tax deduction. He also said there needs to be a return to a lending market where qualified borrowers can get financing.

“People with good credit scores still have trouble getting loans, and I’d have to say there are some proposals to tighten up credit even more,” he said. “The positives now are mortgage rates that are at historic lows for those who can get qualified and available inventory.”

Starter house
Stacy Southard was one who qualified for the mortgage on what she calls her starter home — a three-bedroom house located on Elmira’s Southside.

Southard spent about a year taking virtual home tours online to get a feel for what was available in the area. At the same time, she saved money toward her down payment. When Southard felt she was ready, she kicked her search into high gear and closed on her house in August.

“I only looked for a few months,” she said. “I knew it was a good time, as far as interest rates go, because they were dropping. Friends of mine have rates that are a bit higher and it was nice to know I was able to get one that low.”

How low? 31/2 percent fixed.

Southard’s home was among the 1,191 houses in the area that changed hands last year. According to the Elmira-Corning Regional Association of Realtors statistics, the median sale price of those homes — $107,000 at the end of 2011 — closed out 2012 at $114,900. Sellers were also listing their homes at a higher price and buyers were paying closer to that price.

Outside factors
But in order to keep the market moving in the right direction, home sellers say a number of things have to happen. Employment across the area has to remain stable or improve. Interest rates, now at 50-year lows, have to stay there, and the flow of houses into the market has to remain at an even pace.

“It all goes back to supply and demand,” said Faye Guild-Nash, president of the Elmira-Corning Regional Association of Realtors. “I think the recovery will continue because we are not seeing large numbers of houses coming in the market all at once. It’s a steady flow.”

When buyers are active and the housing supply is limited — down in Chemung, Steuben and Schuyler counties by an average of 15 percent through the third quarter, according to state figures — buyers have fewer options and are willing to pay more for a house they’re interested in. Sellers will often have multiple buyers looking at the same house, Nash said, which can also push prices upward.

So far, home sellers say, the closing of Sikorsky’s facility in Big Flats at the end of 2012 and the loss of nearly 600 jobs isn’t having a negative impact on the local housing market.

“The jobs that have been lost will, hopefully, be regained,” said Art Ambrose, of Realty-USA.com. “It will balance out. Sikorsky is a huge hit, but other things will likely happen and the negative employment will be absorbed by other companies.”

Ambrose and Nash both said interest rates need to stay close to their current levels. Low rates make buying a house more affordable, and that rule applies to first-time buyers and homeowners looking to move up. But there are two sides to that coin, Ambrose said.

Interest rates that are consistently low could mean a buyer who feels rates will stay low for the immediate future will put off home-buying plans. But if the rates start to go up, that same buyer may accelerate plans to avoid an even higher rate in the future.

“We’ve been through a couple of tough years,” Ambrose said. “But real estate is cyclical, and usually, the inventory of homes is less in the winter months and increases in the second quarter because that’s when people put more homes on the market.

“But we’re reporting a lot of activity, which is abnormal given the time of the year we are in,” he said. “Things are busy now and this is abnormal. We are starting the year off in the robust way.”

(For original story, please visit http://www.stargazette.com/proart/20130112/news01/301120053/house-prices-climb-southern-tier-counties?odyssey=mod|dnmiss|umbrella|1&pagerestricted=1.)

Featured Events

View All Events

Site Sponsors

Become a Site Sponsor

Current Publication

Chemung County Chamber of Commerce

Mark Twain Country