HANFRA shares take on East End real estate market

Are Better Times Coming?

Joan Bischoff van Heemskerck, immediate past president, Hamptons North Fork Realtors Association, has an interesting take on the current East End real estate market, and if he is correct, there may be some good news coming, and wouldn’t that be nice?

“Real estate market statistics usually are based on closed transactions as recorded in the public records. When financing is involved, it can easily take 60 to 90 days to close. Then there is another delay for these closings to show up on public records, which can be substantial,” he opined in a recent article dated November 16.

There are a number of reasons the buyer or seller might want their attorney to “sit on” a signed contract before turning it into the county for pressing. One may have outstanding debts; another may not want the adult children or former wife to know there has been a windfall. Negotiating another deal gets that much harder if the other party knows you are flush with cash . . . and so on.

“When a market is turning, such ‘old’ data may not accurately reflect the situation on the ground,” van Heemskerck wrote.

“When a market is turning, such ‘old’ data may not accurately reflect the situation on the ground,” van Heemskerck wrote.

“In our area, there are indications that the market is changing,” he added. “My report provides data based on signed contracts, a much more current measure of market activity, very helpful for buyers and sellers in this market to make better decisions.”

For example, the North Fork seems ripe for an upward move. Though there is a glut of properties on the market in the Hamptons, North Fork inventory remains low (280).

Van Heemskerck commented: “The North Fork as a real estate market is coming into its own. The area is attractive because of its location adjacent to the Hamptons, more affordable pricing, and increasingly popular aqua-agricultural, ‘food to table’ rural nature. Buyers are still flocking to scoop up the bargains,” he said.

“But bargains are harder to come by in today’s low inventory market with median sales prices now around $575,000,” he acknowledged.

The Hamptons are harder to understand. “The Hamptons of course remain a special market, tied in to the financial markets in Manhattan, defying national trends. But if the Hamptons markets follow Manhattan’s, a slow-down was inevitable since 2015,” he said.

Why? The Tax Cuts and Jobs Act of 2017 created some uncertainty by taking away much of a New York taxpayer’s deduction for real estate taxes, but its impact would ebb later in 2019.

Furthermore, wealthy New Yorkers are moving away in droves. Three states in the Northeast — New Jersey, New York, and Connecticut — are among the top places from which people are moving the fastest. “The costly living expenses, crumbling infrastructure, and high tax rates are a big problem for residents. If you live in NYC, you are forced to pay exorbitant taxes,” he said.

These kinds of trends probably weaken the local market, at least anecdotally.