If the Hudson Valley real estate market of the past couple years were developed into a TV show, it would be a soap opera. Last year, smack in the middle of the pandemic, it was bold and beautiful, with buyers snatching up homes at record prices and the young and the restless moving in from New York City and other boroughs. It almost seemed like another world, because of a serious lack of inventory. But we all were on a search for tomorrow, wondering if any Hudson Valley residents who hadn’t bought a home prior to 2020 would ever be able to afford it again.
Good news though. We spoke with a few realtors who have seen a guiding light in a very complicated market, leading us back to some normalcy. But like any soap opera there are always a few twists and turns along the way. So what is happening and what can we expect next?
“Once we hit June, we went from insane to just a normal busy market,” says Greg Berardi, owner and real estate broker of Berardi Realty in Kingston. “In my opinion, it’s completely understandable why the market started early and ended early this year. People have not been away on vacation for two years. The most interested buyers were pretty frustrated with the bidding wars and said they would be back to look again once the vacations were over.”
And they are coming back with purchasing confidence. “Buyers are feeling more confident and asking for sellers to negotiate more than they may have a year ago,” says Rebecca Agosta, a real estate agent with Berkshire Hathaway. “A hot property will only get a few offers now as opposed to a year ago when it would have gotten a dozen offers.”
Lisa Halter, principal broker/owner with Halter Associates Realty in Woodstock, sees a definite shift in buying habits. “We are definitely sensing a shift away from panic buying and into long-term lifestyle re- evaluations,” says Halter. “The days of purchasing sight unseen are probably over. I think buyers want to make the right choice and are taking a little longer to weigh all the pros and cons of a potential purchase.”
On the new build side, supply chain issues are still a thing, for both skilled contractors and materials. “Builders are booked solid, and there’s a considerable wait for lifestyle amenities like in-ground pools and spas, landscaping materials, and high-end appliances,” says Halter.
Overall, the Hudson Valley remains a hotbed of real estate activity, with markets seeing an even bigger spike in interest. “Greene County, where the ski areas are, will probably hold strong right through the winter,” says Berardi.
“The market in Athens, Coxsackie—including Sleepy Hollow Lake—are very hot right now,” says Vicki Wolpert, a licensed real estate associate broker with Keller Williams Hudson Valley North in Kingston. “Many young families are interested in Sleepy Hollow Lake because of the amenities. Coxsackie is doing well because of the development going on at the riverfront. Athens is always hot but not many homes come on the market, so it continues to go up in value.”
But buyers aren’t just looking for single-family homes. They are looking for investments. “Single- family homes or Airbnb homes are probably the most desirable along with 4-plus unit investment properties—and the bigger the investment property, the better and the more desirable.” says Berardi.
It seems like we have a new character that everyone is keeping their eyes on—the rental market. “Rental prices continue to rise as we see new people move into the area because of the growth in the Hudson Valley,” says John Quinn, licensed broker with Quinn Realty in Highland. “We are seeing a lot of professional people moving in, not only from New York City but from all over the country.”
Halter explains one recent change in the rental market: a lack of desire for short-term rental (STR) properties. “As town after town enacts restrictions on STRs, buyers seem to have grown wary of relying on that income to subsidize their purchase,” she says. “It’s also become a very competitive and oversaturated market, so it’s a lot harder to be assured of tenants than it was even a year or so ago.”
Steven Jones, a real estate agent with Keller Williams in Middletown, says that the long-term rental market is just as competitive as the housing market, with low inventory and high demand. “On average, it is now more expensive to rent than it is to buy,” he says. “For example, a place that cost you $1,600 a month to rent, that same size space could cost you $1,200 a month in the mortgage. This last year across the nation, the average home saw rapid appreciation. Renters lost out on an average of $52,000. So, with mortgage rates still historically low, and rentals scarce, more renters are starting to look into purchasing homes.”
Mortgage rates might still be low, but keep your eyes on that storyline because things might be changing. “Mortgage rates are projected to increase slightly over the next year to maybe as high as 3.25 to 3.5 by the end of the fourth quarter next year,” says Jones.
What the next year might have in store for us remains to be seen, but stay tuned because the drama of this show is gripping.