How is the real estate market doing so far in 2023

BY PHILIP A. RAICES

It sure does appear that our market is still moving expeditiously along; although in some areas a bit slower depending on the listing price, type of property, location and school district and the negotiability of the sellers today and going forward during 2023. There are still those who qualify for a mortgage and are putting down either 20% out of pocket with 700+% credit scores and low debt/income ratios up to more than 30+% making them easier to qualify for their financing.

Then again, there are those who are purchasing for cash and buying outright without any financing. This appears to be relevant and apparent in those states and locations where a majority of purchasers have moved from higher priced States. The top 10 States who have had losses in population in 2022-2023, (and some over the last 10 years), as per the Census Bureau were, New York, Illinois, Hawaii, California, Louisiana, Massachusetts, West Virginia, Mississippi, Pennsylvania and Michigan and New Jersey was the 11th.

There are some obvious reasons for the loss of population in those states. The first is the cost of living and real estate and state taxes, for those not earning an adequate income. Possibly, many are and have been laid off and there will continue to be more let go over the next 6-36 months. Major corporations, like Amazon whose who had doubled the number of employees as the headcount peaked in 2021 with 1,608,000 full-time and part-time employees, not contacting external contractors. However, in 2022, layoffs reduced that number to 1,541,000 employees from the start of the Pandemic through 2022.

More important layoffs have continued as an additional 27,000 have been let go. Sales have drastically retreated in many industries, creating the immediate need to cut expenses and that means more layoffs. Many hi-tech company’s sales have been reduced as more individuals have made the decision to work remotely and companies are cutting back their budgets and buying less equipment and technology. Layoffs will continue as long as there is pressure on company sales and profits, reflecting the impact that our Pandemic has dealt to a multitude of companies and our economy.

As layoffs continue there will be a lag affect in the way that foreclosures and short sales will occur. For those whose businesses have failed or who have lost their jobs and are currently homeowners, it would be prudent today to take advantage of the higher prices and plan ahead and consider selling and cashing out, while you have substantial equity that you have gained over the last few years. This is an opportune time to get out so you will leave with a greater sum of money in your pocket, than waiting until prices moderate lower in the future.

Long Island has seen strength in the market with buyers still out trying to find their “next place to call home.” However, there are those that have hopped back on the fence to wait until rates go lower; as that may take a few years based on where our economy and inflation is currently.

According to Lawrence Yun, our economist for the National Association of Realtors researched and found that the statistics showed that those who live out west where 5 out of 10 of the most expensive cities are in California have seen the greatest price reductions. San Jose, California was the most expensive place to purchase a home in the U.S. in the 4th quarter of 2022 as the median price was $1,577,500 and is now down 5.8% from a year ago; and prices there have already dropped 17% from the peak of $1,900,000 median price in the 2nd quarter of 2022, according to N.A.R. San Francisco had the largest price drop in the country, year over year, last quarter, with the median price of $1,230,000 down 6.1% from a year ago. Homes there are already down 21% in the 4th quarter of 2022 from the peak median price of $1,550,000 in the 2nd quarter. Other cities where prices are down are Los Angeles, California, Boulder, Colorado, Boise, Idaho and others. Prices have increased in many areas as much as 42% over the last 3 years,” said Yun, noting that the swelling of prices have far surpassed wage increases and consumer price inflation since 2019.

You can see from the graphs below that single and multi-family homes have still increased, although at a much slower pace than in the last 2 years. However, co-ops have done extremely well and have increased, I believe due to the lower price points and being much more affordable, compared to condos and homes allowing those entering the market to become homeowners.

As you can see, our areas are still doing quite well; even though interest rates have increased, there is still sufficient demand by cash purchasers, who are still buying. Market activity is still strong, and inventory is still at historic lows. If one prices their homes, condos, and co-ops in a certain creative and “out of box” fashion, making demand occur and leading to a potential bidding war, then a successful outcome can be accomplished. However, no one has a crystal ball or become a “Nostradamus” to predict the future. With more banks potentially failing, and our stubborn inflation contributing to either a soft or hard landing recession in our economy, the continuing Ukraine situation, tensions with the U.S. and China over Taiwan and most critical our gun violence and gun laws in our country and other factors will set the general psychology and future mood. Over time these components will be determinant in either a very positive or negative outcome of where our real estate market and economy will be heading in the future.

Philip A. Raices is the owner/Broker of Turn Key Real Estate at 3 Grace Ave Suite 180 in Great Neck. He has 40 years experience in the Real Estate industry and has earned designations as a Graduate of the Realtor Institute (G.R.I.) and also as a Certified International Property Specialist (C.I.P.S.) and in 2022 has earned his National Association of Realtors “Green Industry designation for eco-friendly construction. He will provide you with “free” regular updates of sold and new homes in your town via the Multiple Listing Service of Long Island (MLSLI) or go to https://WWW. Li-RealEstate.Com and you can “do it yourself (DYI) and search on your own. For a “FREE” `15 minute consultation, as well as well as a “FREE printout or digital value analysis of what your home might sell for in today’s market without any obligation or “strings” attached. He can also provide a copy of “Unlocking the Secrets of Real Estate’s New Market Reality, and our Seller’s and Buyer’s Guides for “Things to Consider when Selling, investing or Purchasing your Home.

You can email or snail mail (regular mail) him with your request or ideas, suggestions or interview you for a specific topic and a Q & A for a future column with your name, email and cell number. He will email or call you back and respond to your request ASAP as long as he has your complete name, cell, email and/or full home or business address. Again, for a “FREE” 15 minute consultation, he can also be reached by cell: (516) 647-4289 or by email: Phil@ TurnKeyRealEstate.Com to answer any of your questions and concerns in selling, investing, purchasing, or leasing residential or commercial property.

BY DENNIS MAMMANA

Week of May 7-13, 2023

Just about every indigenous culture on Earth developed a set of constellations in their sky. Those that we in the West recognize today are mostly those created by the ancient Greek and early European explorers. These cover the entire celestial sphere and represent objects, animals and people from mythological stories.

Occasionally, however, we encounter a constellation that’s associated with a real person, and if we look skyward shortly after dark this week we can see one such example.

High in the northeastern sky you’ll easily spot the Big Dipper, itself not a constellation, but rather an “asterism” -- a group of stars that looks like something familiar. Follow the Dipper’s handle away from its bowl, and you will encounter the bright yellowish-orange star Arcturus and, eventually, the bluish-white star Spica in the southeast.

It is within the arc formed by these three celestial points that we find the small faint constellation known as Coma Berenices, which represents the beautiful amber hair of the ancient Egyptian Queen Berenice II, the wife of Ptolemy III (also known as Ptolemy Euergetes).

The story of Coma Berenices tells that Ptolemy waged a long war against the Assyrians to avenge the murder of his sister. To honor his safe return,