As the dearth of listing inventory persists for the North Fork real estate market, prices continue to drive higher as demand outstrips supply. According to Douglas Elliman’s Q4 2021 North Fork report, listing inventory dropped 40.4% from the corresponding quarter in 2020 and bidding wars made up 37.6% of market share; by year end, there were only 124 available listings on the North Fork.
Enter 2022 and the sizzling market remains mind-boggling. Daniel Gale reports an average sales price of $827,898, with 59 days on market and 100% expectation of paying asking price. Town & Country CEO Judi Desiderio doubles down on reporting this trend, confirming that as of January 2022, fewer than 60 homes were available for sale.
Tom McCloskey, licensed Associate Real Estate Broker with Douglas Elliman in Cutchogue, sees the market remaining strong through 2022 with many listings having multiple offers – with a disclaimer. “It’s not going to be the complete mayhem that we’ve experienced for the past 18 months,” explains McCloskey, “with buyers more than willing to pay more than the asking price. I’m now finding that some buyers are reading the newspaper and are concerned about rising interest rates as well as buying at the top of the market. I’m seeing more cautious buyers exhibiting some hesitancy to go over ask. There’s no panic buying.”
Rising interest rates may present another pivotal difference in the 2022 real estate market. Rising interest rates mean less buying power: every 1% interest rate hike translates to a 10% decrease in buying power. In response to a 7% in increasing inflation rate – a level not seen since the early 1980’s – Federal Reserve Board Chairman Jerome Powell indicated that the Fed would likely raise interest rates by March, which in concert with the reduction in the bond buying program, would keep inflation from becoming “entrenched.” However, Corcoran Licensed Associate Real Estate Broker Sheri Winter Parker thinks it’s premature to conclude that rising interest rates and inflation will have much of an impact on the North Fork real estate market. “It’s just too early to tell. We are going to have to wait and see what happens – it’s that kind of pattern right now.”
Where are the buyers coming from? Among so many other things, Covid-19 has changed the workplace forever. According to a recent Harvard Business Review study, remote, hybrid and flexible workplace options put into place by employers to weather the pandemic storm will likely remain in effect through much of 2022. The study concludes in part: …with hybrid and remote work as the norm, the geographic radius of the organizations that someone can work for also expands….even in a hybrid model where employees are expected to come into the office at least once a week. Employees are much more willing to take on a longer commute when they must do so less frequently.” This trend neatly dovetails and explains away much of the huge increase in the number of buyers seen on the North Fork over the past two years. No longer just a flight from the confines and close quarters of the NYC metro area during the pandemic, remote/hybrid work options allow buyers to move farther from the office without much regard for commuter timetables. “Generally speaking,” reports Tom McCloskey, “about 70% of my buyers are not from the area and not all are from New York City.”
And sellers? Some sellers are sitting on the sidelines, hesitant to list their properties because relocation options are limited. This is a great time to sell if you’re retiring or divesting a second home and already have another place to live. Other sellers are market shy, concerned that their properties are outdated and won’t sell easily. If that’s the case, here are a couple of quick fixes:
Paint. A little paint goes a long way. If you’ve got dark rooms, lighten them up. If you’re struggling with a color, white always works. For white paint ideas, visit
benjaminmoore.com or your local retailer.
Staging. Professional staging prepares a home for a potential buyer by redecorating, rearranging furniture, cleaning and other aesthetic strategies to present the home in the best possible light. Professional staging your house for sale is sure to help with getting a buyer to contract.
Don’t be put off by the cost by either painting or staging either, as these practices are proven “money multipliers” – meaning that you’ll see a multiple return on investment reflected in the sale price of the property. These sale tactics are important, especially given the general buyer appetite for renovation projects. “If a house needs work or otherwise does not look like a newly-renovated, modern farmhouse, there will be a huge disparity in price,” shares Tom McCloskey.
Sheri Winter Parker is seeing a lot of “creative options” – meaning developing new product, or redesigning, redeveloping and renovating existing homes and properties. “I’ve been working with renowned architect Thomas Juul Hansen to bring three beautiful new and exciting homes to market – hopefully by the end of 2022 and into 2023,” shares Ms. Parker. In the meantime, she’s seeing “off market” deals which are not listed or otherwise available to the general public. “Some sellers just don’t want to be public, citing privacy concerns like not wanting their neighbor to know that they’re selling.”