Picture it: the Hudson Valley. A home goes on the market. There aren’t that many for sale, so buyers jump and bids pour in, and plenty are over the asking price. The home sells very quickly. The losing buyers scramble to the next home, hoping to finally beat out the other competitors…er, buyers, and close the deal on a home. No, this isn’t a sitcom description of the real estate market during the pandemic, and it certainly isn’t 2020. Several Hudson Valley real estate agents say this is still happening today.
“There is only a 3.2 month’s supply of homes, meaning that if nothing new came on the market, there would be no houses to sell in 3.2 months,” says Lindsay Stevens of Stevens Real Estate in New Paltz. “But while the market has been cutthroat for so long, we’re seeing buyers not having to compete the way they were six months ago. There are not as many buyers in the market, thanks to lack of supply and higher interest rates.”
Ellie Savoy, associate real estate broker at Houlihan Lawrence in LaGrange, still sees multiple offers on homes under $400,000, but there are also fewer homes under $400,000 to bid on. “The market is leveling off a bit in some respects, but we need more inventory, so homeowners need to make a decision to move, and interest rates need to come down,” says Savoy.
Donna Hardisty, owner/broker of Sam’s Realty in Beacon, has been in the real estate business since she was 15 and was a receptionist for her father, the Sam of Sam’s Realty. So like all of the realtors interviewed for this article, she has seen and survived many of its ups and downs. She describes today’s market as “difficult.”
“It’s difficult to find homes on the market, and many buyers don’t have enough cash to put as a down payment,” says Hardisty. “Unfortunately, because of the interest rates, there are also many people who don’t want to sell. First-time homebuyers may want to go into a larger home, but their current interest rate is four percent and they don’t want to buy a bigger home because they don’t want a seven-percent mortgage.”
Stevens says that fear is also driving the narrative. “Your mom, dad, and uncle are telling you, ‘Oh my god, the rates are so high! but it’s still historically low in terms of interest rates,” she says. “(In 1981) they were 18 percent. Remember that buyers were overpaying by $200,000 a year ago. And now they aren’t doing that, but the interest rate is slightly higher. So secure the home you want, love it, and get that rate to come down once the interest rate comes down later.”
“When the buyer sells their home, they can’t find a place to move in the rental market and the rents are really high,” says Dawn Passante, associate broker with Coldwell Banker Village Green Realty in New Paltz. “And, if they want to buy a home, there is such little inventory and they are having difficulty getting a mortgage because of the interest rates.”
While some sellers downsize and move into Hudson Valley apartments, which are also hard to find, Savoy says that some are moving south to the Carolinas or Florida. Interestingly, she says that buyers are still coming in from New York City, but also from California. “People who work in New York City can work part-time from home and don’t mind the commute when they have to go in, so they are looking for homes up here,” says Savoy. “Californians are coming to the Hudson Valley because it has great appeal. We get four seasons here and the film industry is here now, so the Hudson Valley is desirable.”
Stevens says the good news is that while buyers are still immersed in bidding wars, negotiating is back on the table. “Some buyers are able to negotiate terms, do inspections, and come back with repair requests,” says Stevens. “A few of our agents have had listings where the buyer is now the only offer, and some price reductions are happening.”
There are other positive signs that things are changing. According to the June 2023 New York State Housing Market Report, the average number of days that a house is staying on the market is 62. “Last June, it was 45 days and this June, it’s 53, so it’s a bit extended,” says Stevens. “The average price point also went from $405,000 to $390,000, so there’s a bit of stabilization in the rising housing costs.”
Although homes are still moving very quickly, Passante explains that the ones over a million dollars are sitting just a little bit longer. “In Ulster County, any home that’s under $600,000 is the price that is the most active market and then it slows as you go higher,” says Passante. “When we were listing houses for a $1 to $2 million in Gardiner and New Paltz, they were selling like hotcakes. Those were the city buyers buying their second homes. Now it’s more local buyers trying to find a home.”
Looking long-term to solving the inventory shortage problem, Passante is hoping that builders step up. “They haven’t because their expenses are so high,” she says. “There’s also a need for more single-level homes. Seniors are retiring and want to downsize and get rid of their big houses. Those mega-mansions aren’t as popular as they used to be. People want to downsize their utility bills and their space. I feel like the new generation is simpler and not asking for much. They just want to be able to live.”
In six months, it will be cold and possibly snowy, but Savoy says there will still be a high demand for homes. “Pre-COVID, winter was a slower time, but when somebody looks in the winter, they’re a serious buyer,” she says.
“Sellers don’t like to list their home in the winter unless they have to, because they don’t want to move in the middle of a snowstorm,” says Passante. “The weather’s bad for showings and it gets dark early.”
Overall, there has been a very small amount of positive change in the real estate market since we last checked in with local realtors, but a little is better than none.