- Well, we have received market reports from almost every major corporate firm Out East telling us and folks in the business what everyone knows: the real estate market is down nationally and that trend has reached the East End.
Last week we reported Suffolk Research's overview on the same topic. That's what they do. Good stuff to know when pricing for a client or judging for investment opportunities, but then what?
Not sure real estate firms' time and money may be better spent thinking out of the box to put buyers and sellers together, and advertising and promoting the business is about sales, yes? But then what do I know?
But first, news you may not know: Jan MacKin has joined Town and Country Real Estate in East Hampton. A long-time resident, MacKin knows the area.
Notes From Prudential Douglas Elliman Market Overview:
• "The just-released Fourth Quarter 2008 Prudential Douglas Elliman Hamptons and North Fork Market Overview reveals that like most of the New York region, the Hamptons and North Fork real estate market was characterized by a decline in the level of sales activity and lower price indicators.
• "The credit crunch, Wall Street employment, and the national recession have all played a role in the slow down. The number of sales for each quarter has reflected a decline as compared to the same period in the preceding year for at least four consecutive years. Median sales prices posted its third consecutive year over year quarterly decline. However, the luxury market outperformed the overall market with a year over year increase in quarterly median sales price, which has occurred in three of the past four quarters."
• Median sales price declined 13.8 percent to $690,000 from the prior year quarter result of $800,000 while average sales price declined 0.8 percent to $1,474,771 from the prior year quarter result of $1,487,161. The number of sales dropped 40.8 percent this quarter to 363 units as compared to the 613 units sold in the prior year quarter.
• Days on market were 150 days this quarter, more than two weeks faster than the prior year quarter result of 166 days and listing discounts were 15.4 percent, up sharply from 8.1 percent in the prior year quarter while listing inventory increased 19 percent to 2,079 units from the prior year quarter.
The Hamptons Market
• Median sales price was $875,000 this quarter, down 7.9 percent from last year at this time and average sales price was $1,810,722, up 1.9 percent from the prior year quarter. The 257 sales represent 41.3 percent fewer transactions than the same period last year.
The North Fork Market
• The median sales price was $500,000 this quarter, down 13.9 percent from last year at this time and the average sales price was $660,249, down 13.1 percent from the prior year quarter. The 106 sales represent 39.4 percent fewer than the same period last year.
The Luxury Market
[Highest 10 percent of all Hamptons/North Fork condo and one through three family sales].
• Median sales price of a luxury property this quarter was $4,660,000, up 8.4 percent from last year at this time while the average sales price this quarter was $6,857,781, down 7 percent from last year at this time.
The Condo Market
• Median sales price of a luxury property this quarter was $368,970, down 36 percent from last year at this time while the average sales price this quarter was $479,836 down 35.7 percent from last year at this time.
Then comes The Corcoran Report
with a letter from Pamela Liebman, chief executive officer: "By now it is well established that the American economy has entered a serious recession, fueled in large part by the slowdown in housing and the on-going credit crisis. Residential real estate sales activity in 2008 demonstrated that the East End is not immune to the phenomenon that has swept the nation and much of the developed world.
"As the number of sales declined sharply, motivated sellers responded by dropping their asking prices, driving the median price down in almost all categories. How much more are prices going to come down?" While it's impossible to know what the future holds, the full extent of the price decreases that began to be recorded last year are colored by their timing. But with so few transactions in the pipeline, downward pressure on prices will continue until a sense of urgency is restored for buyers.
"In the last few weeks, intelligent buyers have taken the opportunity to snap up fantastic real estate at a comfortable savings. Speculative activity is certainly on the wane."
"Inventory has been steadily increasing during the course of the recent economic downturn."
"Sales volume - As a result of macroeconomic influences, sales activity was down significantly in the first quarter of 2008, resulting in increased sales volume overall in the fourth quarter, primarily in lower end sales."
In any case, East End real estate is a very strange business and getting stranger.