Blogger: Stability and Normalcy in Store for 2012 North Fork Real Estate

What does the future of real estate hold in store for the upcoming year? Is this going to be a boom year or a down market? Where is the balance between a sellers or buyers market? Will prices drop or will they increase?

As you speak to buyers and sellers, you hear the intent in the answers they want to hear biased on their side of the fence. The prediction is the North Fork real estate market will trend towards stability and normalcy.

"What does that mean, and how do you know?" you might ask. Here is a breakdown of seven local trends in real estate:

• Median Sold Price: The median price of the homes that have sold each year provides a statistical valuation of the consumers confidence. This statistic is derived from the prices the buyers are paying for the houses. As the years move forward, you can review these numbers and see where the real estate market is trending. The home buyers in the past years are looking for value. That will continue through 2012.

The median home price of all of the sales in 2007 at the peak was $525.000. The last two years of 2010 and 2011 as the market corrected, this adjusted to $440,000. It is good to see the stability. This is reassuring for both the buyers and sellers. It creates a financial base to work from as they decide if this is the right time for them to buy or sell.

• Total Homes Sold: During the downturn, the numbers of homes sold have slowed. Buyers have come to the North Fork looking to purchase homes based on the communities. They find the real estate taxes are lower than the areas they currently reside and see the value in the cost of living. They wonder if this is the right time to make a purchase. This is the change in thinking that has started to normalize the local market. They are purchasing homes that they want and need.

• Investors: There are fewer buyers purchasing homes based on conversations within their social circles. During the boom you would hear a fair amount of the decisions to purchase was based on investment appreciation. They bought an asset with the thoughts it would be sold in a few years at a profit. Now you hear more purchasers are buying homes that they will all enjoy for years to come. They also express the thoughts that they feel they will be worth more in the next 10 years and that is comforting to them. It shows the confidence and stability in investing in this asset class. The small segment of buyers who were flipping houses in this market has decreased and that is partially reflected in the lower sales volume. They are still buying out here but there are less of them.

• Retirement: Many couples are looking for homes to use during their retirement years. This area has many attributes that draw home buyers with this use in mind. The area is close to family and friends that live within the tri-state area. It is also offers a slower pace of life. The entertainment offerings are valued. With the North Fork vineyards, they have vista's to relax and enjoy the fruits of the region within a social environment. The local dining options offer local harvests from the farm stands and fresh seafood from andThe economy has started to stabilize enough that the thoughts of retiring in the coming years has started to make financial sense. You can see that in the increase in home sales in this segment of the market over the past two years. It appears that trend will continue.

• Vacation: The second home buyer comprises one of the largest percentages of home purchasers in the region. This segment has stayed active and it appears that will continue into 2012. Over the years they have changed their criteria. Smaller homes and lower price points have become the new trend for these buyers. They look for location and nearby amenities. The appeal to the region is the three-hour travel time from their homes to a relaxing vacation region.

• New Construction: The new construction offerings and sales have decreased the most out of all of the buyer segments.The decrease in total sales is largely attributed to this change in the real estate market. The Southold Town land preservation laws have reduced the opportunities to convert farm land into new housing neighborhoods. The builders are no longer creating new neighborhoods with many offerings of similar homes. Now the boutique builder is active and they are building a limited quantity and high quality home.

• Local: The adjustments in the housing prices has been a boon for the local home buyers! It is rewarding to see the recovery of this segment of the market over the past few years. As the pricing has become more affordable and the low-interest rates on mortgages, this has helped the local buyers enter home ownership. This will continue into 2012. The real estate market on the North Fork exhibited a trend to quality and stability during uncertain times. People are going to look for value in their sales and purchases in the future. The real estate industry on the North Fork has responded to this trend appropriately. Knowledge, answers and services have all seen dramatic improvements over the past couple of years to the benefit of everyone! It is reassuring to know that will not change for 2012!