The pandemic is pushing up house prices in the region, sort of


Jamie Mazuryk estimates that about 90% of the home deals she sold during the pandemic were above asking price.

“If the price was right, the price was exceeded,” said Mazuryk, real estate agent at CM Fox. The same goes for houses receiving multiple offers. “Almost every home that was priced right” had multiple offers, she said.

Home prices in Albany County have risen by about 17.7% since the start of the pandemic, from $ 225,000 in March 2020 at $ 264,900 in October, according to the Greater Capital Association of Realtors. The median price of an existing home sold in the United States in October was nearly $ 354,000, up about 13% from the same period last year. according to the National Association of Real Estate Agents.

In the seven municipalities within The Enterprise’s coverage area – Altamont, Bern, Guilderland, Knox, New Scotland, Rensselaerville, Voorheesville and Westerlo – the rise in the median property sale price was even more pronounced, over 33% , compared to $ 239,500 in March. 2020 (based on 32 sales) at $ 320,200 in November (based on 43 sales), based on home sales data from the New York State Office of Real Property Tax Services website.

While the pandemic has pushed up local home prices hard and fast, given long-term trends, COVID-19 appears to have only slightly accelerated the steady rise in median home prices for nearly a decade – though inflation is taken into account.

For example, in 2012, the median price of a home sale in one of the seven municipalities covered by the Business was $ 231,700. But a dollar in 2012 (July of each year was used in the calculations), with inflation added, according to the Bureau of Labor Statistics, was equivalent to $ 1.19 in October 2021. Thus, the house of $ 231,700 in 2012 costs $ 275,723 this year.

The past year has been unprecedented, Mazuryk said.

Most homes have seen multiple offers, there isn’t enough inventory, and there has been an influx of buyers.

A Schuster Road house in Guilderland listed by Mazuryk had seven offers. It initially had a price of $ 349,900 but sold for $ 380,000, approximately 8.6 percent above the asking price.

“I just set the price right and we got seven offers within a week,” she said. The Schuster Road home went up for sale on May 13 and had a pending sale just four days later, according to an online real estate agent site.

The seven-bid situations don’t really happen anymore, Mazuryk said, but there continue to be multiple offers on houses, often in the range of two to three. Mazuryk said she believes the market will rise again because mortgage interest rates, which are often attached to 10-year cash flow bind returns, remain weak.

Buyers

During the pandemic, Mazuryk saw a lot of first-time buyers. “In the past it was mostly their first or second time,” she said. “Now there are a lot more firsts; many more premieres in the past two years.

Mazuryk, who has a team of three realtors and an assistant, said there has been an influx of buyers – people in their late 20s and early thirties – who want their first home but the stock just isn’t there. There were 425 homes for sale in Albany County end of October, down 30% from the previous year, i.e. two and a half times the national average shortage

Most of his clients are millennials, Mazuryk said.

“A lot of young people are joining the pool of buyers,” she said, reflecting the national trend. Millennials, the group of people born between 1981 and 1996, were, as recently as two years ago, considered a generation of permanent tenants. But the millennials hit housing milestone in early 2019; it was the first time the group accounted for more than half of all new home loans, which it continues to do. In 2019, the most recent data available, millennials made up 37% of homebuyers, according to the National Association of Real Estate Agents.

Mazuryk said some buyers are avoiding big weddings, others have seen their parents pull off 401K. Some buyers received help from their parents in the form of cash.

“There are a lot of cash offers; a ton of cash transactions, which is totally unknown, ”she said.

The two main advantages of a cash sale are that the person selling the house gets paid faster than with a normal mortgage and the banks don’t get involved, Mazuryk said.

Federal stimulus checks linked to the pandemic, along with forbearance from student loan payments, in addition to the boiling stock market, are other reasons cited for the increase in young buyers.

Mazuryk does not anticipate a real estate crash like the one in 2008 because “banks don’t lend money to people who don’t have it,” she said. “You either have it or you don’t.”

One of the root causes of the Great Recession was that banks were giving loans to people who had no credit history – or really poor, and when history inevitably repeated itself and these buyers went been unable to pay off their massive mortgages, the banks had gleefully reversed. , the mortgage market collapsed.

“It’s so strict these days; it’s so strict, ”Mazuryk said of trying to get a mortgage. She thinks millennials don’t want a lot of debt. “No one takes mortgages over 30 or 15 years anymore; what’s really cool is not having a mortgage, ”she said. She sees more buyers younger with 10 years old adjustable rate mortgages.

The right price

Appropriately valuing a home is imperative, Mazuryk said.

“There was no doubt,” she said, that homes priced between $ 250,000 and $ 350,000, clean and properly appointed were going to have multiple agents.

“Cleanliness is an important thing, [a] big factor, ”she said.

A house can be outdated, she said, “nobody really cares”; as long as it’s clean, a buyer can handle that. But if a house is “obsolete, dirty and disgusting” it will be reflected in the price, “and these houses will not be offered in multiple offer situations.”

From the onset of the pandemic, around mid-March 2020, until the end of November, the state’s SalesWeb has listed approximately 1,210 residential sales – single, two-family and multi-family homes, by no means verifiable full accounting of sales of houses in the territory – in the seven municipalities of the Company’s territory: 368 of these sales are between $ 250,000 and $ 350,000; 477 others are less than $ 250,000; and the remaining 365 are over $ 350,000.

With the exception of Guilderland and Voorheesville, the other municipalities that The Enterprise reports saw more homes sold in 2020 than they had in the previous eight years, and have the registration tax. mortgage to prove it.

New York State, according to the Department of Taxation and Finance, “imposes a tax on the privilege to register a mortgage on real estate located in the state.”

In Albany County, residents pay a registration tax of $ 1.25 per $ 100 of mortgage. The local municipality receives 25 cents, as does the county, in addition to the Capital District Transportation Authority, and 50 cents is donated to the state, which in turn returns some of that money to the county while keeping some for help finance the mortgage insurance agency.

Mortgage taxes dispersed in June were collected for the six-month period between October 2020 and March 2021.

Florinland, for example, received $ 713,717 on a mortgage account of 814. For the previous semester, the municipality received $ 820,688 from 724 mortgages, depending on the county.

Nova Scotia received approximately $ 216,000 in mortgage taxes for the first six months of this year, which equates to income based on a mortgage count of 262. For the previous dispersion of county mortgage taxes, from december 2020 and which covered from April to September of that year, there were 217 mortgages registered in Nova Scotia for which the city received approximately $ 172,500.


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