As Westchester County area home sellers are finding out, there are more buyers out there; that doesn't equate to happy endings. Here is an unscientific example of the pattern I am seeing:
- The house is listed for a price the sellers feel good about. Not great, good. Showings the first few weeks, then nothing.
- The price is lowered once 2-5%. A few calls and showings, no offers.
- The price is once again lowered 3% or more after no offers. Showings do not increase.
- Frustrated, the sellers are faced with the market changes of the past 90 days. What few sales in their category there were are dwarfed by enormous unsold inventory. They then lower the price to the next price point. If they were at 215k, they go to $199,900. If they were are $569,000, they get below 550k.
- An offer comes in at 90% of the new, lower asking price. Hoping to meet in the middle, the sellers make an aggressive counter offer. The buyer comes up a few thousand, leaving a large divide. The buyer agent informs the listing agent that the buyer has 2 other homes in mind.
- Here's the fork in the road: The sellers acquiesce and get sold, or buy their house back for the 10k or 20k difference in price and wait out another buyer as we enter the summer.
I see the same pattern all over the New York Metropolitan area. It is the same in Westchester as it is in Queens. Rockland, Putnam and Dutchess counties are all in the same boat. Large inventory gives buyers options, and they are are committed to not overpaying or being stuck in a house they can't sell if the creek runs high in a year or two. The nice people who took care of their home and hope to reap what they have sewn are competing with distress sales, bank owned REOs, short sales, and other under cutters. It is a battle they can't win.
Buyers are returning to the market for a variety of reasons- the pent up demand of 5 years of low sales, low rates, and media stories that the bust is past the bottom. But that doesn't mean they will do what buyers did 10 years ago to get their offer accepted. There are too many other options are out there, and caution still overshadows the marketplace.
It is all a byproduct of the lessons learned of the irrational exuberance of the boom era from before 2007. e are just beginning to dig out if we are in the beginning of a recovery, it is frail. A bird in the hand in this market is very, very valuable.