The story Natalya Mickinberg of V.I. Properties Team at Compass Real Estate is telling would have been apocryphal only a few years ago, but today it rings as part cautionary tale, part sign of the times.
A homeowner on Long Island’s South Shore is pondering listing his house for more than a million dollars. Homes around his, seemingly offering more, have all recently sold for less than seven figures. He is convinced to list it for $999,000 and gets a full offer on its first full day on the market. So he decided to change his price, relists for $1,250,000, and wind up with $1.1 million. “And he didn’t take it,” she says with smile. “Now he wants to buy something. He’s looking to buy something in order to sell.
“You can never tell.”
That is one concrete conclusion Mickinberg has drawn from the white-hot real estate market we have seen across so much of Long Island for just over a year now, one in which prices and days on market and other factors have given us glimpses of things we’ve never seen before. Yet amid this ride, there are a few other certainties affecting the market with summer almost in the rearview mirror.
“Prices are very high, and on every house we have backup offers, multiple offers,” she says. “Last summer was a hot market, but we had more inventory. This year it’s extremely low. Supply and demand. Prices go higher when inventory is lower. There are also historically low mortgage rates, but It won’t be forever, they’re going to go up very soon, maybe as early as the beginning of next year. So people who want to buy, they need to be prepared buyers. They should have everything available for purchase.”
“Inventory is extremely low right now,” Mickinberg continues, noting that she also sees the potential for some change. “Hopefully now we’re going to get houses on the market, people who were thinking about selling in the near future are seeing what’s going on and will put their houses on the market. Hopefully,” she adds with a laugh. “This isn’t my prediction. Hopefully.”
Without question, many people have been listing their houses for more—in some cases, substantially more—than they might have otherwise, hoping to take advantage of the current situation of supply outpacing demand and properties moving so quickly. “Sometimes people are buying for $50,000, $75,000 more than they think it should be, but they’re still buying because there is not a lot to compare with,” she says.
But that does not mean things are on an endless accension, of course. “The market will dictate,” Mickinberg adds. “If it’s not selling in two weeks, they have to go down in price. And everything has a price. Nobody wants to pay one-and-a-half million for an $800,000 home. And we still have people who are buying with a mortgage, and the appraisal also shows what is wrong and what’s right.”
As does time. Looking ahead over the next few months, while she does not have a crystal ball, she does have some advice. “I wouldn’t say be patient, because in [a given area] you cannot add inventory. But maybe look into a different area, where something might still be available.”
Just a few weeks ago, Mickinberg recounts, “we scheduled an appointment with a guy who wanted to see three houses. Two of them has signed contracts, so there was only one. A couple years ago I would have said, ‘Oh, don’t bother to go see only one house.’ But now I cannot say that. I say, ‘Go, look, and if it’s your house, buy it.’”
Learn more about Natalya Mickinberg and V.I. Properties Team at Compass Real Estate.