Upstate House

After the high-stakes drama of the pandemic and its immediate aftermath, real estate around the Hudson Valley is showing small signs of a healthy leveling trend. Inventory isn’t quite as tight, bidding battles tend to involve three or four players rather than eight or nine, and prices are increasing a bit more slowly—although Pattern for Progress points out in its first quarter market report that those prices have been steadily outpacing inflation for seven years now, leaving many a first-time homebuyer and moderate-income family priced out. It’s still hot out there, but when you’ve been gasping in 110 degree temps, even a 90-degree day can feel like a bit of a relief.

There’s still a lot of competition for move-in-ready homes, says DeWayne Powell, a Chatham-based agent for William Pitt and Sotheby’s International who sells across the entire region. “Competition for fully renovated or new houses is still very stiff, and people are picky about what they consider move-in-ready,” he says. “Not everyone has the stomach to take on a renovation project that might take months or years. For houses that aren’t move-in-ready, the seller is a lot less able to dictate the terms than they might have been a couple of years ago.”

Powell sees a lot of second-home seekers, and he says they’re coming with an air of deliberate decision, not a panicky urge to flee the city, and a clear sense of where they want to be. “A lot of people are very particular about a given location; say they’ve been weekending in a particular place and feel comfortable there. If they’re determined to be in Columbia County, they are unlikely to consider Greene or the Berkshires, even if every other detail fits and even if the property tax is lower.”

Don’t Bypass “Nearby” Towns

If you’re looking and on a budget, realtor Sandi Park, a broker with Coldwell Banker and Hudson Valley Nest, says it can be to your advantage to be flexible about location and be willing to consider the towns that don’t generate a lot of press in the travel blogs but may still offer considerable advantage, including easy access to the same attractions or their own nascent cultural scenes. “Everybody talks about Newburgh, but almost no one is talking about Middletown,” she says. “I was there the other day and there’s an area of North Street that’s vibing early Beacon. Cute tea shop, a place where you can make your own candles, cute little restaurants. Then there are what I call the ‘nearbys,’ places that don’t have as much of their own buzz going on but offer easy access to everything that does. Highland, for example; there’s not a ton going on there, but you’re 10 minutes from Poughkeepsie in one direction and New Paltz in the other. On the other side of the river, Hyde Park and Pleasant Valley have some of that same energy going on.”

Park, who publishes her own newsletter The Brick, on the Hudson Valley real estate scene, says that besides the move-in-ready trend hitting hard, houses that can be considered first-floor primary, in which the main bed and bath don’t require climbing stairs, are highly sought after. “People are thinking ahead and they want a home where they can age in place, and those first-floor primaries are less than five percent of our overall inventory right now, which is a problem,” she says. “Quite a bit of the inventory problem can be traced to restrictive planning and zoning. People are no longer looking for that vast McMansion on five acres, but when they look to scale down, there’s not a lot they can afford in this market that fits their needs.”

Have Financials in Order

Tim Ayers, a Kingston-based agent with Berardi Realty, says the tight inventory situation still calls for patience and having one’s finances and needs figured out, in order to be able to move quickly when the right deal shows up. “Inventory is loosening up a little, which is good, but that said, we have a lot of people who want to be here and not enough houses. On the higher end of the price range, we’re seeing a little more softening, but finding a decent house in Ulster County for, say, $400,000 is a huge challenge these days.” Those who succeed in finding their niche, he says, tend to be well-prepared. “People who are willing to come out and look at 10 to 15 different properties develop a feel for the market and what’s attainable,” he says. “And of course, have your financial qualifications set, because once you find what you’re looking for, there’s not a lot of time to waste. Anything that’s underpriced is still going into bidding wars or highest and best offer.”

Ayers is a big fan of the concept of accessory dwelling units (ADUs) to help alleviate the pressure, since they can offer a solution to the downsizing problem that keeps older homeowners locked in place, not wanting to leave the area but short on affordable options if they do sell. Park agrees, and says more people are looking at housing hacks that make it possible to share space or generate some income to offset prices and tax rates. “Up-and-downs, where the shared space is on one level and beds and baths can be both above and below that, are in high demand,” she says. “And I think multifamily places have the possibility to emerge as an overlooked solution. I’m seeing a little more interest in that.”

Anything overpriced, all three realtors agree, is likely to sit on the market until the sellers come to terms with reality. Ditto, says Park, for historic properties with so- so updates. “If the materials are subpar or there’s badly done molding, people are noticing that these days,” she says. “People are no longer going into deals blindly, and one result is that despite the overall price increases continuing, some things that sold for outrageous amounts during the frenzy are now back on the market for less than the last buyer paid.”