Merrick Real Estate '09: A Tough Sell

They're not giving homes away in Merrick, but at this rate, it wouldn't be a shock to see Oprah come to town exclaiming, "You get a house, and you get a house!"

The recession was felt all over in 2009, and that includes the local real estate market.  Home prices continued to fall, as did the number of people looking to buy, or in the very least, were allowed to.

Tim Castor is a broker with Prudential in Merrick.  He says that since the banking crisis hit, banks have altered their standards in terms of who qualifies for a mortgage.  This means a smaller pool of buyers for an increased number of homes on the market.

"The abundance of sellers combined with the dirth of buyers caused prices to drop 25 percent in the last three years," Castor says.

Castor says along with the bank standards, the fact that the birth rates of the last century were lowest in the 1970s and '80s has also decreased the buyer pool, as those people are now in their 20s and 30s, and would be the most likely to buy.

It all adds up to sellers not getting the prices for their homes they once did. Luxury homes have been affected the most, with few people these days wanting to be saddled with a high six-figure mortgage.

"Years ago you couldn't touch anything in Merrick for under $500,000," says Arlene Gregory, a broker with Century 21 in Merrick. "Today there are scattered homes in Merrick that can be had for under $300,000."

Gregory estimates that home prices were down 10 percent at the start of 2009, and then leveled off mid-year.  That's when first time home buyers began to receive an $8,000 tax credit, as per President Obama.  Now, Gregory says, entry priced homes are moving swiftly.

But will that trend last?  A wild card has been thrown into the equation--foreclosures--which while not as prominent locally or statewide as they are elsewhere, could still flood the market with homes that banks simply want to unload, for any price.

"Different towns are being affected much worse than here, but even here in Merrick there will be some short sales and foreclosures, specifically on the higher priced properties," Gregory says.  "Sometimes people can't make their ends meet."

As for the coming new year, much like the job market, the real estate outlook will improve only if the economy as a whole sees an upswing.

"If the dollar is dropping in value, if people don't have jobs, the real estate market won't somehow pick up on its own," Castor says.

His advice to sellers is to be reasonable in their asking price, and that buyers should act now, since interest rates may rise come 2010.

Arlene Gregory echoes those sentiments.

"The only thing that differentiates brokers from sellers...we don't say I need this price, we say this is what your house is worth," Gregory says. "We have statistics, we want to please the seller, but not at their expense."

The consensus is that Merrick is still a desirable place to live and raise a family.  Eileen Langer has been trying to sell her grandmother's home on Salem Road since August.  The original asking price has been reduced, but an offer is being considered right now.

"The market's tough right now," Langer says, "but I think we get a lot of bites on the house because of the neighborhood."

Perhaps Oprah won't have to pay a visit after all.