By: Denise M. Champagne//April 18, 2014
By: Denise M. Champagne//April 18, 2014//
The weather is a major factor behind a sluggish first quarter of 2014 in the housing market and the final quarter of 2013, but sales are expected to pick up soon with the year finishing slightly ahead of 2013.
“As we say in the real estate business, it’s location, location, location, but with the new home market this past quarter, it’s been weather, weather, weather,” said Rick Herman, chief executive officer of the Rochester Home Builders’ Association Inc.
He and other housing market leaders released first quarter 2014 statistics Thursday at the Rochester Home Builders’ Association offices in Henrietta.
Herman said the weather led to a sudden halt in building in the last quarter of 2013 with one of the most severe winter in years. He said many builders stopped building, partially for safety reasons, and that with the cold, no basements could be dug or concrete poured, but that builders are looking for a very active second quarter to even things off.
He said buyers are starting to come out now that the weather is improving.
The total number of building permits issues for single-family homes in Monroe County was 130 in the first three months of 2014, compared to 143 for the same time period a year ago. That is a 13 percent drop. The number of permits issued for multi-family homes was 153, the same as last year.
Ontario County saw an 80 percent drop in the number of building permits between the first quarter of 2013, when 87 were issued, and the 17 issued so far this year, but Herman said there were a couple of big projects, such as Bristol Harbour and another project in Farmington of more than 20 units, for which all of the permits were drawn at once.
There was a 20 percent increase in Wayne County, although the difference is only one, from five building permits issued in the first quarter of 2013 to six in 2014.
The weather has also been a factor in declining home sales with fewer homes on the market. Andy Burke, president of the Greater Rochester Association of Realtors, said it is harder to get homes ready to sell in the winter and buyers are staying at home because of the weather, although activity has picked up at open houses in the last two weeks as the weather has picked up.
“If we don’t have it, we can’t sell it,” Burke said. “What is on the market is selling. We just don’t have as many homes. We expect more homes coming on the market and an increase in the number of sales.”
According to the Genesee Region Real East Information Services, the information subsidiary of GRAR, the number of homes for sale in Monroe County in the first quarter of this year was 2,499, down 10.8 percent from a year ago. New listings, at 3,020, are down 4.8 percent while closed sales dropped 11.8 percent to 1,122. The median price, however, rose 2.4 percent, from $122,000 to $124,950. The overall median price throughout the 11-county region remained unchanged at $120,000.
The total volume of closed sales for the Monroe in the first three months of the year is $160.9 million, down 13.1 percent from a year ago; $240.9 million throughout the 11 counties, down 10 percent from the first quarter of 2013.
The number of homes for sale throughout the region in the first three months of this year were 4,737, down 9 percent from a year ago, but up 3.2 percent from the fourth quarter of 2013 when 4,588 homes were listed for sale.
The number of closed sales was 1,716 for the first quarter, down 8.3 percent from a year ago and 37.2 percent from the fourth quarter of 2013.
Burke said it is a great time to be a seller with limited competition, which also leads to higher selling prices. For buyers, Burke said it is still the right time to buy as interest rates are rising.
Jaime Frederes, a member of the Mortgage Bankers Association of the Genesee Region board of directors, agreed, saying credit is still available and it is very affordable to own a home. He said current interest rates have leveled off at around 4.25 percent to 4.5 percent.
Burke said Rochester is fortunate because it has not had the foreclosure problems that have plagued other parts of the country in the down economy, however, that has led to a lack of inventory. He said people are choosing not to sell or are delaying downsizing until they feel secure in the current economy or until the housing market improves, but he said the housing market has improved more than people may think.
Declining inventory is good news for home builders as more buyers consider new homes when they cannot find what they are looking for in the available market.
“Our company will probably have its best year ever,” said Joe Sortino, RHBA past chairman and owner of Sortino Properties of Pittsford.
“We anticipate a good year,” Herman said. “Our builders continue to be very optimistic and all of them are crediting the slow start to the severe winter weather.”
Also present were GRAR CEO Jim Yockel and Patrick Cusato, 2014 president, Mortgage Bankers Association of the Genesee Region.