This article is reprinted by permission from The Escape Home, a newsletter for second homeowners and those who want to be. Subscribe here. © 2021. All rights reserved.
Living outside of major U.S. cities has become expensive but potentially lucrative for buyers and sellers. One of the hottest real estate markets in the United States right now is upstate New York, which is vaguely defined as towns and suburbs north of the New York metropolitan area. Low mortgage rates and people wanting to escape large cities for quieter, less-crowded towns and neighborhoods have contributed to the boom.
The entire country has had a real estate resurgence, with 94% of metro areas seeing double-digit growth in the second quarter of 2021, according to the National Association of Realtors (NAR). The median sales price of existing single-family homes across the U.S. rose 22.9% to $357,900, an increase of $66,800 from one year ago.
New York City has long had some of the highest property prices. While the city has been recovering from the pandemic, many people are looking to escape to more rural areas of the state. Here’s what you could end up paying for some of upstate New York’s most popular towns:
From the second quarter of 2020 to the second quarter of this year, Kingston had a 22.5% increase in median price of existing single-family homes to $338,300, the NAR reported. Glens Falls had an 18.2% jump in median price to $232,900. Elmira had a 10.4% increase to $141,800.
The Escape Home spoke with realtors in upstate New York to find out what it’s been like to buy and sell property during all this craziness. Here’s what they had to say:
Mary Lou Pinckney, director of corporate relocation for Select Sotheby’s International Realty
Q: What is life like for a realtor in upstate New York right now versus before the pandemic?
A: Life as a realtor in upstate N.Y. is very lucrative and challenging at the same time. Pre-pandemic we had a substantial amount of inventory and it was priced well. Since the pandemic, people from the Tri-State area — New York City, Connecticut, New Jersey — have been flooding to the Adirondacks and the Finger Lakes, wanting space, property, as well as square feet. They were and continue to be working remotely and quite simply are loving it.
Our markets — Saratoga Springs, Hudson, Adirondacks, Finger Lakes — have boomed so much because they’ve been discovered. People fleeing the city came north and found a terrific quality of life with small, vibrant cities with a lot to offer in the way of restaurants and the arts.
Q: What are the most active markets now and what types of homes are people looking for?
A: The hottest towns are Hudson, Saratoga Springs, Bolton Landing, Lake Placid and the Finger Lakes in central New York. People are looking for homes that are open, have separate, quiet space for home offices, space for home gyms, Pelotons etc., swimming pools, outdoor patios and three to four season porches. Many are looking for waterfront or bike-able, walkable to town kind of properties.
Q: Are you seeing more bidding wars?
A: There are definitely bidding wars. Homes stay on the market anywhere from 24 hours to a week. I’ve seen prices escalate to over $100,000 the asking price.
I’ve missed out on at least four offers because the sellers accepted higher prices or better terms or both. For instance, [buyers] waive inspections or pay cash to escape a bank appraisal.
Q: What’s the most expensive property that you’ve sold recently?
A: The most expensive house I just closed on was $3 million. We had many parties interested, but the couple that purchased it moved quickly, as to not get into a competitive bidding situation and they put a very large down payment with the contract.
Q: Are you seeing more foreign buyers?
A: We have had foreign buyers. However, they were coming up from New York City and Connecticut.
Q: Are you still holding open houses?
A: Open houses are non-existent. I believe you will see less and less of them. People are still afraid to be in spaces that they’re not sure are “safe.” We are not out of this pandemic yet, in my opinion.
Q: Do you think sellers were pricing homes too high and that buyers were willing to overpay?
A: Yes, sellers were pricing homes too high and if the location was right, people were overpaying for sure. I had a listing that went to multiple offers and sold well over asking because the location was terrific but the house needed a great deal of work. Location is a driving factor and if the square footage is there, buyers are willing to spend more in purchase price and more to update the homes.
Q: What’s your best advice to people trying to buy into this market?
A: Best advice is to engage a professional broker/agent that earnestly listens to your needs and your price point, who will be willing to go the extra mile and network and be proactive to find you that special home.
Timothy Sweeney, president of Hudson Valley Catskill Region Multiple Listing Service and owner of Berkshire Hathaway Home Services Nutshell Realty
Q: What does the upstate New York real estate market look like now compared to pre-pandemic levels?
A: The market we’re experiencing right now is similar to what happened after [the] 9/11 terrorist attacks. When 9/11 occurred in 2001, a surge of New York metro region buyers flocked to the mid-Hudson Valley. At that time the average sale price in Ulster County was $218,000. Six years later, due primarily to the migration of New York metro buyers, the average sale price topped out at $303,000. The mortgage crisis of 2008 caused home depreciation of about 25%. When Covid-19 hit, the market had fully recovered to the $300,000 plus average sale price. The big difference between the 9/11 driven market and the post Covid-19 market is that the 9/11 buyer was generally buying a second or weekend home. A large portion of post Covid-19 buyers have purchased a full-time residence. The ability to work remotely has been a game changer for real estate in the upstate market.
Q: Do you see a continuation of low supply of homes and continued price appreciation?
A: Significant development in the majority of communities in our region is not looked upon positively. When coupled with the difficulty and cost of navigating planning board approvals, we will most likely see a continuation of low existing home inventory. As long as that continues, home prices will experience some level of appreciation.
Q: Are you seeing multiple offers at your properties?
A: We are seeing many many multiple offer situations. In fact, multiple offers are more the norm right now. There is also a tremendous amount of cash buyers in the marketplace.
Q: Is there still a need for open houses?
A: Open houses in our market are very rare due to the rural nature of our area. Also, with such a hot market open houses aren’t really necessary. New listings, if priced correctly, sell within days.
Joan Roberts, associate real estate broker at Coldwell Banker Timberland Properties who focuses on the Catskills Mountains, Ulster County and other areas in New York
Q: How has the Catskills market changed since the pandemic started?
A: [It is always] busy in our area of the Catskills, but the pandemic brought two to three times the business. Most from Brooklyn, Manhattan, Long Island and Northern New Jersey. But Brooklyn is definitely the winner. It hasn’t really eased up yet and now we’re prepping for another wave.
Q: What has caused this real estate boom?
A: Fear of being amongst too much population plus understanding that they can have a delightful escape from the city life within two to three hours. Many of our residents work from home and many areas of the Catskills now have all of the necessary amenities: Internet, WiFi, cell service. Plus we offer so many recreational activities: Skiing. [There are] five major ski slopes in this area alone. Swimming, golf, hiking, boating, kayaking.
Q: What are the hottest towns/markets within upstate New York now?
A: Most of Ulster County has been a hot area — even pre-pandemic. Cities like Woodstock, New York, and Kingston have seen tremendous growth. But the middle/western Catskills have become very popular as well. The Margaretville/Roxbury areas have grown and become very much a tourist mecca. House sales have led this trend and townhouse sales find equal popularity. There are fabulous gourmet restaurants in the Catskills, plus delightful organic, vegan and trendy spots.
Q: What are the most popular types of properties?
A: All types of homes from cottages to log cabins. Most want at least an acre or 10. And then there are those who prefer a townhouse community where there are excellent amenities and full maintenance. These have all been selling very quickly. In Roxbury Run Village—a townhouse community in Roxbury, NY, — there are 120 units and generally 10% have been for sale at any one time. We went through the available inventory during the pandemic and now there was perhaps one on the market. And they sell very fast, for cash and involving bidding wars and escalation clauses.
Q: Are properties getting multiple bids?
A: There are most definitely bidding wars happening, with many exceeding current property values.
Q: What’s your best advice to homebuyers?
A: Best advice is to do your homework, so you know what you want. Then be pre-approved by a lending institution or your personal investments. People are looking for fast closings. The best deals are the cash deals — no mortgage, no inspection, no appraisals. Clean and quick.
This article is reprinted by permission from The Escape Home, a newsletter for second homeowners and those who want to be. Subscribe here. © 2021. All rights reserved.
This post was originally published on Market Watch
