Local Home Sale Prices Show No Signs of Going Up

Despite a cautiously optimistic third-quarter report from the Westchester Putnam Association of Realtors, Inc., which tentatively projected the county housing market's 2011 year-end performance to be on a "mildly improving trend line" from the lows of 2009, local home sale prices are going anywhere but up.

In the Katonah-Lewisboro school district, the median sale price of a single family home dropped from $750,500 in 2008 to $627,000 at the end of 2011's third quarter, according to year-to-date data from the Westchester-Putnam Multiple Listing Service.

In Bedford Central, a similar downward trend presents: The median price declined to $772,500 in 2011 from $858,500 in 2008.

So why are prices down?

"Consumer confidence is at an all-time low and the inventory has accumulated," said Hope Mazzola, an associate broker at William Ravies real estate office in Katonah, in an interview with Patch. "There's a lot more to choose from now, which drives prices down and lowers buyer motivation."

Mazzola said part of the reason for the logjam of homes on the market is more stringent bank requirements—though loans are out there, in order to obtain them buyers now have to have assets and higher credit scores to qualify for a mortgage.

Nelson Salazar, a broker at Coldwell Banker in Katonah, said another factor in today's down market is deflating prices from the early 2000s.

"You saw the Northeast home prices shoot up then and the market was flooded with mortgages. In 2010 we saw a temporary improvement due to the federal first-time home-buyer credit, but it was nowhere near those artificial prices and not even at 2008 levels," he told Patch.

A side-by-side comparison of the sales volume in both school districts shows Bedford Central rebounding a bit better. Total year-to-date sales has remained steady since 2008, with total units sold at 153 single-family homes at the end of the third quarter in 2011, up from 136 in 2010 and total dollar volume at about $172 million.

In Katonah-Lewisboro, sales declined to 111 single family homes in 2011 from a high of 123 in 2008; when comparing the same years in total sales volume, there's a 24 percent drop, from $108 million to $87 million.

Though Mazzola said part of the volume in the Bedford Central district is due to the inclusion of the more affordable Mt. Kisco housing market, she and Salazar acknowledged the commutability factor in a buyer's market.

"There's no doubt the Lewisboro area is getting harder hit—it's further out and people are more focused on location," said Salazar. In Bedford Hills or Katonah, obtaining a train pass can be easier as well.

But there is good value in the market now, said Mazzola, and unique opportunities that may not have previously existed. She cited one example of a seller willing to pay a shortfall on the mortgage of his current house to the bank in order to trade up on a house that is more affordable to him now than a decade ago.

In its county-wide analysis, the WPAR attributes the uptick in third-quarter sales to buyers taking advantage of low mortgage interest rates and lower sales prices. And a recent Wall Street Journal story suggests that those factors make it an ideal time to buy a house.

As for whether the local real estate market will see an upward turn, Mazzola said she wasn't sure it would without an incentive for buyers similar to the 2010 federal measure but for most people, home ownership and enjoying the house they live in is the number one reason people buy.

"The reality is that the reasons people buy a house—getting married, getting divorced, having a baby, changing jobs or death—still exist," she said. "Home value will come back."

A copy of the WPAR report is posted with this story, or you can view it on the association's website.