Fall 2009 Real Estate Newletter


   Fall, 2009 Newsletter

 Gay E. Rosen, ABR,CBR, CRS, GRI, SRES

Licensed Real Estate Associate Broker

                                                            Where are we NOW?

My January, 2009 newsletter centered upon “Looking into the Crystal Ball for 2009” and it has, indeed, been a very interesting year to say the least. The year started off being very quiet, and the spring real estate season which traditionally starts in late January and ends in June, actually commenced several months later than January and was quite active in certain  price ranges even in July and August. I think people were either waiting for those (sometimes) non-existent bonuses in order to purchase, which affected the higher priced sales, or they were simply waiting for the prices to depreciate further for homes in the $500‘s and $600‘s. Buyers have also taken advantage of the first-time home buyers tax credit which will expire on December 1st of this year, and FHA loans have also helped  inspire some sales. The higher priced homes have suffered most.

 There was an interesting article the other week in the August 16th, Sunday Times (“ In the Grip of Indecision“ by Laura M. Holson). It basically stated that some buyers are now discussing real estate with their psychologists and psychiatrists. Should they buy now and regret it later when the home prices perhaps plummet even more?  (hey, appreciate the current prices and just enjoy).Or, in the case of the sellers, they realize that they purchased at the height of the market, should they sell for less than they paid for the home, or should they hold onto the property hoping it will increase in value?  “If they don’t sell, they don’t regret the loss”.  In the case of the buyers,  my first thought was this is something we, as Realtors, have been advising our customers and clients alike for years.  Real estate is still the best long term investment someone can make. For several  reasons:

I liken it to purchasing a designer suit (gentlemen please humor me and think about a car!). Firstly,  when you are shopping to purchase, you see a suit you “love“, and there is a nice discount. The size, color are all available to you , and you take the plunge and enjoy it immensely. Or, conversely, you do not buy it, and then, 2 months later, that same suit is priced even lower. However, the size is one size too small (so you tell yourself you will breathe in more or exercise/diet more to compensate), and the color wasn’t the one you had set your heart on. You buy it because it is a great deal, but you end up not wearing that suit as much as it simply wasn’t the right fit for you in the first place. The same with a home. If you are looking for the best buy out there then you will probably regret buying it once you are  within the home if it isn‘t exactly what you had wanted in the first place. The first things about the home that plagued you will always be there.. And it will lessen your enjoyment, and after working long and  hard each and every day, you need to come home, relax, and to look forward to going home. As they say, ‘home is where the heart is.” So, if, in the long run, just hypothetically speaking, you do end up paying a few thousand dollars more BUT you love the home, then you will simply enjoy the home as it is the ‘right fit.’ for you. Remember that home prices will eventually start increasing.. Not at the same pace it was  a few years ago, but if you plan on living in your new home for the next 5-7 years (the usual time span for home-owners), then you should realize a profit even if just a small one, plus you will have happy memories of having enjoyed your home, the one you wanted in the first place. Also, if you wait until the home you really like is priced where you want it to be, chances are that other buyers have also been tracking that same property and you will find yourself  in competition with them.

 There are so many articles to read.. Which article to take direction from? Every given day of the week, you will find an article stating  “Existing Home Sales rise 5.1 Percent” (Associated Press 2009),  or “The Depths of Mortgage Debt ( August 30th, NYT Bob Tedeschi)   or  “After a Bumpy Ride, back to Square One”   (Floyd Norris, 8/29/09 NYT)  “July new U.S. Homes Sales up  9.6%“ ( Alan Zibel, AP Real Estate Writer 8/29/09) or “ Declining U.S Home Prices….” (The Fundamental Analyst 7/1/09)……  It is confusing to both  prospective buyers and sellers alike. What to believe? How to react or act? I think a key word is filterWe all need to filter facts from fiction and think on a local basis. Many articles are written on a broader nation-wide basis , and so just as I had written in August, 2008, I believe we must first all start looking at the documented sales prices in the country as a whole, and obviously to be aware of what is happening in the country and our economy as a whole, but with regard to purchasing a home, we should look closer to home, and to look at those facts that we have available to us. After all, Detroit might be selling homes at 1997 prices, but we are only at 2002/2003  prices! Be positive!

 So, with that thought in mind, the US home prices as measured by the Case-Shiller Home Price Index, indicate that home sales continued their decline in April of this year – although at a slower pace. Good news. The latest data, released on August 25th, 2009 indicated that Home Price Indices, the leading measure of U.S. home prices, the National Home Price Index improved in the second quarter of 2009. There was a decline of 19.1% in the 1st quarter of the year, and the 10-City and 20-City Composites recorded annual declines of 15.1% and 15.4% respectively. These are also improvements from their recent respective record losses of -19.4% and -19.1%. Okay, forget all of these numbers…I am not looking to confuse –  what does it mean to you?

 I have enclosed some graphs. Some are from the Council of Foreign Relations  (an online non-partisan resource for “everyone in these turbulent times who wants to learn more about the complex international issues challenging policymakers and citizens alike” ) . The graphs are a comparison from the the World War 11 recession compared to the recession we are now encountering. The parallels are very interesting. We can’t discuss how other nations are impacting the U.S., or the price of oil or how the U.S./China Relationship will affect our future in this newsletter, and so I am only addressing current home price and sale considerations. The second set of stats are local market overviews. Yes, property sale prices are down, and yes, they would appear to be at 2002/2003  sale prices. However, based on the most recent  Case-Shiller Home Price Index,  there is some hope in sight. 

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     I will also state that the buyers are out there…Like birds on a fence, waiting for that delectable morsel to appear.. Home sellers should be the proverbial worm!  Buyers are waiting for the home that offers value, more so than the other homes available in the same or even slightly higher price range. I have seen it happen, time and time again, that as soon as a home is priced ‘well’ (competitively), the buyers rush forward, and it can bring forth multiple bids, helping the client realize the price they had wanted (or close to it) in the first place. I have an excellent video on “Pricing your home “ by David Knox which I share with clients who are on the fence about pricing. The video is well versed, to the point, and spoken in easy to understand facts and figures. It is important to listen to your agent when preparing a home, be it de-cluttering, painting a little or sprucing up the home.


One has to realize that if the home is priced and staged well, then the buyers will come as they do not want to ‘lose’ that home..  If it is priced high, then they will wait until it is lowered…

 When I represent a buyer, I look to the recent sales on the street, within the community, and then we bid accordingly. I do not refer to those articles suggesting they bid 25% less, 30% less. They are irrelevant for the property might well be reduced to sell already. No, I suggest that the buyers forget everything they have read, and then look towards the sold prices on the street where their desired property is located,  the condition, and then to the zip code and elementary school . This is what the appraiser will be looking at. He/she  will also be looking at how many months that home has been on the market, and will adjust the value accordingly…An acceptable offer in today’s market is basically a palatable price that is acceptable to both buyer and seller. Once again, price is important. There was an interesting article in the NYT on appraisers on August 19th, 2009. Banks and lending institutions are paying less for the appraisal service, and therefore hire appraisers from far away who have no knowledge of your area, and of course, many times, their lack of knowledge is reflected in the appraisal to the buyer’s detriment. I met recently with a Long Island appraiser who had never been to New Rochelle, and I shared several long telephone conversations with him discussing the various homes that had sold in relation to the property he was appraising. This is quite the norm now.

 For the sellers upon pricing a home, I have enclosed a cute cartoon from the NYT the other week…. It might make you flinch but there is definitely joy from the home-owner when their property is sold. But what a shame if they do lose that $300,000 as in the cartoon… if the home had been priced well in the first place or commensurate with the market place, then there wouldn’t be that loss or even think of it as a loss but rather a realistic listing price.. However, as in the case of homes priced well over a million, there haven’t been many sales… so how does one price a home in the first place when similar properties have not even sold? Should they hold fast with their desired price or lower it?  I think it all depends on your personal situation. If you have time on your hands, then you can certainly wait a certain amount of time, but if property prices are lowering (as they have been), then  pay heed. .… I can recall a lovely home in the neighborhood being on the market for over 2 years and it sold at a wonderful price of nearly $2.5 Million as ‘they waited for their price” It was also several years ago and those days are over.  That house would have been devalued every month it remained on the market by an appraiser if it were sold today. I have heard 1% for every month.

 Absorption rates are a key point of discussion with sellers. An absorption rate is  not specific and property features, condition and price will do more to sell any property as opposed to a mathematical formula, but it is a general indication of where the market is. An absorption rate is determined by looking at how many homes have sold the preceding month and  how many homes are available for sale. For instance if 12 homes sold in the last 12 months = one a month, and there are 10 homes on the market then there is a 10 month absorption rate. If there is a 5 – 7 month  or less absorption rate, then it is indicative of a seller’s market, and if it is over 7 months then it is indicative of a buyer’s market. A seller is better off competitively pricing a home to be ahead of the market  as opposed to chasing the market and languishing .

 I hear agents and sellers alike complain that there just aren’t any buyers around. That is not true. The attendance I see at open houses dispels that myth along with other facts. It should be noted that the buyer’s pool remains relatively constant. However, fewer buyers will actually buy nowadays unless the property is positioned well in the market place. It will take the right house and the right price to get them involved. I know that I am being repetitive, but this is important. No appointments usually means that the house is priced too high. Or, a  great quantity of appointments and no bids still means the property is priced too high.

 Interest rates are still wonderful. Conforming rates are about 5.25%, and Jumbo rates are about 6.25%. I can recall purchasing my home with a loan of 8.25% (which I refinanced a year later to 6.8%) but I can also recall people paying 13%….The current rates are good, and together with home prices being lower, it is indeed a wonderful time in which to purchase. For home owners wishing to sell, choose the right agent, one who will keep you informed of the market, and one who has a marketing plan. It is easy to list a property, but homes need to be marketed well.

 Home owners sell for many reasons, upgrading their home, downsizing, relocating, divorce or for monetary reasons and should not be discouraged on the process. There is some encouraging news (and facts) out there. Choosing the right agent to represent you who will endeavor to make the transition an easy one is important, and always choose someone with the right qualifications. As a Certified Residential Specialist (only 30,000 + agents in the U.S) and as both a Certified Buyers Representative and an Accredited Buyers Representative, as well as a Senior Residential Specialist (only 20,000 + agents within the U.S.) I am here for all of your real estate needs.

Lastly, look at your property taxes. My heart goes out to the many home-owners who have been overpaying in their tax assessments for many years without realizing it. If you are seeking to sell your home, high taxes could also hold back prospective buyers.

Selling and buying is  a process, but I can make the process easier. Having lived in New Rochelle for over 30 years, if you would like to have more information about absorption rates for your area,  please feel free to contact me with any of your real estate questions or needs.


 Gay E. Rosen

ABR – Accredited Buyer’s Representative

CBR -Certified Buyer’s Representative

CRS -Certified Residential Specialist

GRI – Graduate Realtor Institute

SRES – Senior Residential Specialist

Licensed Real Estate Broker


Houlihan Lawrence

2070 Boston Post Road

Larchmont New York, 10538

Exclusive Affiliate of Christie’s Great Estates


(914) 833-0420 Ext. 307

(914) 907-2645


#1 Realtor New Rochelle Brokerage 2008

#1 Realtor New Rochelle 2008 (per the MLS)



About Gay E. Rosen

Gay E. Rosen is a Top Realtor in the Larchmont and New Rochelle (Lower Westchester) area. She is diligent, caring, driven and thorough (with a sense of humor).Utilize her expertise. Call her!
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