By
Charles McChesney, The Post-Standard
The Post-Standard
on November 13, 2012 at 6:30 AM
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Olga Doyle of John Arquette Properties has this three-bedroom home listing on Miles Avenue in DeWitt for less than $100,000.
More than four years into a buyers’ market in real estate, those looking for homes face a growing challenge: There are fewer homes for sale.
“It’s not so much a buyers’ market as it used to be,” said veteran real estate agent Jim Wheeler.
In September, the latest month for which statistics are available, 4,457 homes were listed by the Greater Syracuse Association of Realtors. That’s down 26.5 percent from a year earlier and down 25 percent from September 2010.
Since last November, every month has seen fewer homes listed for sale than there were a year earlier.
“I think a lot of people are just sitting on their property,” said Andrew Besemer, who has been selling real estate in Syracuse and the surrounding area for 13 years. Most people aren’t selling unless it’s because of a job transfer, divorce or death, he said.
That’s especially true of those who bought in the middle of the last decade. “Most of those people are underwater and sitting on their house.” Besemer said.
That lack of supply may be giving life to a bumpy increase in prices. The average price for a home sold in the Syracuse area in September was up 2.2 percent over a year earlier, the GSAR reported. In the first nine months of the year, GSAR reported price rises six times and declines three times.
The biggest decline, 6.8 percent, came in January. The biggest increase, 9.7 percent, came in July, when the average sale price rose to $159,331 from $145,230 the year before.
The Central New York market has a wide range of home prices. The most expensive on the market as of Nov. 7 was a 5,400-square-foot home on two acres in Manlius with an asking price of $2.5 million. The cheapest single-family home was a two-bedroom, one-bath place listed “as is” for $14,900. Because of that, the mix of homes sold in any given month can dramatically affect the average sale price.
A different measure, “percent of list price received,” which compares the price paid to that asked, shows the market holding steady. In September, buyers got 95.5 percent of their listing price. In July, it hit 96.5 percent.
For the 12 months from October 2011 to September 2012, the number averaged 95.2 percent, precisely the same as it averaged for all of 2011.
What is different is the national market.
In 2007 and 2008, house prices collapsed in Arizona, Nevada, Florida, some parts of California and in other overheated markets around the country. Millions of homes have been foreclosed on by lenders, and new buyers were able to purchase homes for far less than they had sold for just a few years earlier. The price drops were dramatic.
Some of those markets appear to be coming back. The Associated Press reported last week that Arizona home prices had risen 18.7 percent in the past year and Nevada home prices were up 13.1 percent.
Mortgages remain a concern for some borrowers. A challenge, Wheeler said, is getting loan appraisers to OK borrowers who are willing to pay a bit more for a home than similar houses have been selling for in the past few years. Until other house sales close at higher prices, they can’t be used for comparison, he said. Once they can be used as “comparables,” appraisals can rise. “We’re three to four months out from that happening,” he said.
Some areas saw mortgage rules grow lax a decade ago and draconian in the past few years.
“In my opinion, it never got that bad here,” said John Arquette, whose John Arquette Properties has offices in Fayetteville and Clay. He noted that when he got into the real estate business in 1982, borrowers needed a job and some savings for a down payment.
Today, he said, it’s the same way. (Things got less strict in the middle of the last decade, he said: “If you could fog a mirror they’d give you a loan.”)
“We have the same underwriting standards that were in place in 2005 or 2009, so it is not more difficult now to get approved for a mortgage,” said Karen Zarach, vice president at Solvay Bank. “There are fewer mortgage lenders in the market today than in 2005.
“We have continued to see a steady volume of activity through the last four years. The low interest rate environment has spurred refinancing activity in this market as consumers look for ways to stretch dollars in a tight economy,” she said.
Wheeler, Besemer and Arquette said mortgage rates remain near historic lows.
“Ownership is cheaper than rent,” Arquette said. He added that lumber prices have risen, pushing up the price of newly built homes. He said that upward pressure on new homes could “spill into the market” for existing homes.
While it may be less of a buyers’ market, sellers aren’t at all in a rush, Besemer said. Buyers remain very picky, demanding houses be ready to move into without a lot of fix up work, he said.
“Both parties work,” he said. “They don’t have the time — and if they do have it, that’s not how they want to use it.”
Price remains key, all three said. Wheeler said he spends a lot of time explaining to clients that if they ask what they think their home is worth — instead of what comparable homes are selling for — they risk being passed up by a buyer.
“Good, clean properties priced correctly sell within 60 days,” Besemer said.