Go east, homebuyers.
That’s the message people in Nassau County and New York City have heard in connection with home-buying decisions amid the COVID-19 pandemic.
‘A number of people, because of the density of the population, decided they might like to move away from the city life and get to more open space.’
After the real estate market all but shut down during the worst of the lockdown in the spring, buyers have shown considerable interest in homes for sale in Suffolk County, driven by numerous factors including people leaving the higher-density areas of Manhattan. Additionally, prospective buyers working there have recognized that a remote working environment has given them options further from the city.
“Because of the pandemic, there was a slowdown in the request for housing and the market stopped for a while,” said John Fitzgerald, an owner and broker with Realty Connect USA, which is headquartered in Hauppauge. Once the market returned, “a number of people, because of the density of the population, decided they might like to move away from the city life and get to more open space,” he added.
With more buyers than houses available, bidding wars erupted. Prospective buyers also benefited from low interest rates, as people shopped for homes based on the monthly cost to build equity in their homes, rather than absolute price.
In some cases, within 10 minutes of a seller listing a house on the market, the phone started ringing for agents, Fitzgerald said. Prospective buyers and agents are calling or reaching out through the internet soon after some new listings appear on the market.
“It doesn’t matter the time of the day or the evening,” said Setauket-based Michael Ardolino, who is also an owner and broker at Realty Connect USA, which has offices throughout Long Island.
The prices for some homes have increased during the course of the year.
“If you’re selling something in February for one price, here we are in September, you can see a price difference,” Ardolino said. “Clearly, people are getting more money.”
Indeed, one home seller, who preferred not to use her name, said she put her house on the market in May but due to the pandemic nobody could come see it.
That, however, didn’t stop people from showing interest as numerous calls were made to her. She even received an offer from someone who hadn’t been in the house.
The offer that the seller eventually accepted was higher than the asking price. The sale closed only a few months after she put the home on the market.
With homebuyers expecting to use their houses for leisure and remote working, Fitzgerald said builders are already considering altering their architectural designs. Instead of a large den, some builders are exploring the potential for two private offices.
“In brand new construction, that will become more of a desired piece when people shop,” he said. Additionally, people may start looking for separate entrances, allowing them to minimize the noise and traffic that comes through their offices.
Some buyers are looking for an area where they are close enough to be in walking distance to town, but don’t want to be in the middle of town.
Catherine Quinlan of Coldwell Banker has also seen high demand for homes, particularly in Port Jefferson — one of her areas of expertise, where the inventory isn’t especially high.
Houses are “selling fast if they’re priced right,” she said.
While the supply-demand curve is tilted toward sellers, the pricing power isn’t extreme. She said sellers might get an extra $10,000 to $20,000, but that they aren’t collecting an additional $100,000.
Buyers are not only looking for office space to work at home, but are also interested in pools. If there isn’t a pool, buyers are asking if there’s enough room to build one.
In other markets, some folks may not want pools, but the current uncertainty about travel, vacations and even the availability of community pools has encouraged some buyers to add them to their shopping list.
Fitzgerald said the demand for pools is high enough that there is a waiting list to buy both in-ground and above-ground pools.
For one home she wasn’t showing, Quinlan was surprised to see a bidding war.
Houses that would have been on the market for months because of the condition are selling in a market in which buyers are willing to “work with a house” to accommodate their needs and to upgrade amenities or even rooms, she said.
Homes that are in the $400,000 to $500,000 range in particular are finding receptive buyers.
For prospective buyers who might be waiting for prices to come down, Fitzgerald suggested that the other side of the cost is interest rates.
“If the rates went up 1%, [buyers] could pay $40,000 to $50,000 more for the home,” he said, so they wouldn’t necessarily have saved by waiting.