The Camping Renaissance

Quiet weekend. I'm not sure if it is the weather, or the end of the school year, but I did not have appointments either day. I did have to meet an appraiser on Saturday up by Parksville, and that gave me an excuse to stop in and see my friend Ann at Hunter Lake Campgrounds. Besides this soggy week, she says they are having one of their busiest seasons ever. (And she's been there almost thirty years.) I got a similar report from the owners of Soaring Eagle Campgrounds right over Kellams Bridge in Stalker PA. They have been just about full all season so far.

There has always been a pretty substantial camping business in Sullivan County, but now with the recession, and people returning to a "simpler time" (the media seems to have latched onto that phrase) it seems camping is having a bit of a renaissance.

There really are some hidden gems as far as campgrounds go in our area. Hunter Lake is one of my favorites, not just because the owners are real hardworking likeable people, but because it has that upstate Adirondack/Lake George feel, at half the distance. The lake is gorgeous and the campsites are tucked in by the lake. http://www.hunterlakecampground.com/

Lander's Campgrounds at Skinners Falls is a pretty popular one, but there are quite a few all along the Delaware. Most have canoe or kayak/tube rentals, so you can enjoy the river.

Here is a list of a few others. http://www.catskillhikes.com/sullcamp.html

While there are detractors from the whole camping thing, there really is no other vacation or weekend getaway that compares in price. Yeah there are bugs, and the possibility of rain, and dirt, but I remember as a kid, sitting around the campfire at night, the fireflies blinking, the smell of smoke in the air, a stomach full of smores and hot dogs. Without sounding like a visa commercial, those memories are priceless.

Many of my buyers have similar memories of this area. It seems when they are describing their dream property, it hearkens back to a childhood summer memory, whether it be camping, or a relative who owned.

So during the lean times, lets cultivate a whole new generation, who will fall in love with the Catskills. And if you make it up to Hunter Lake, say hi to Ann for me.

Interest Rates and Gas Prices...What else for a Perfect Storm?

There has been a rather disturbing trend happening over the last few weeks that I have an uneasy feeling may effect the slight bounce in our real estate market.

One of the things that brought buyers back, was obviously the historically low interest rates, and to a lesser degree, (although some would argue this point) gas prices. I have had this discussion before, and there are people who are adamant that if a second home buyer can afford a 200k plus Sullivan County home, and a place in NYC or surrounding area as a primary home, and afford all the expenses that go along (two heating bills, two tax bills etc.) a sixty cent jump in gas prices will not effect their bottom line.

I disagree. Now I'm sure there are people out there who pay no attention to gas prices, but the vast majority of my buyers, are stretching for the dream of country home ownership. An extra fifteen dollars a trip, translates to $60 a month. If you added $60 a month to payments on a 30 year fixed at 5.85% (the current rate) it would be a difference in price of $14,000. That is a pretty big difference in buying power.

Now add almost a whole point onto an interest rate, and you can see how timid buyers may duck back down into the foxhole.

I am normally a pretty bullish guy when it comes to our real estate market. But even I started to scratch my head at some of the prices back at the end of '07 and into '08. We have all witnessed a pretty major correction. (20 to 30% percent by some estimates). I still truly believe that there are some good bargains out there, but this belief that we have reached bottom?...I am not so sure.

I think if interest rates stay around this level, and gas prices do the same, we will stay at status quo. I am just concerned that one more event...one more big corporation collapse, or 400 point Dow drop, or a big jump in unemployment...could freeze this market again, and we may not see signs of buyers picking themselves up and dusting themselves off, until the fall.

Hope that is not the case. Right now in my personal real estate world, things are moving right along. Maybe it is paranoid to look over one's shoulder. I just feel we may be at a cross roads and the next few months will really determine which way we move.

Really?

I stayed up to watch Saturday Night Live last week. Something I haven’t done in a while. SNL really isn’t what it was back in the day, but I digress.

Anyway they have the segment …“Really?” during the weekend update. I found myself saying that a lot this week, as I encountered the relative insanity in my profession, and surroundings.

Like the fact that a stove needs to be sitting in a kitchen of a brand new construction. It doesn’t need to be hooked up, just be there for the appraiser to see. Fridge? Not necessary. Just a stove. Or else it doesn’t appraise. A $300,000 home missing a $200 non-working stove. The bank will not loan on it Really…

Or the fact that our state can manage a hostile takeover, and shut the doors for two days, and yet fixing a pothole is too big an undertaking. Are these guys still getting paid while the doors are locked? Of course they are. I know this partisan crap has been around forever, but really? Is this the way grown ups in “power” act? Really? And we have people who still believe that gambling will come to our county. These people can’t get out of their own way. (And that is not a blind knock on the governor. We know he is sensitive.) Really.

How about the co-broke showing I went on, where the owner told me “realtors aren’t worth an eff.” Really. Nice to meet you too. I think you need a Prozac and a nap. Oh and by the way, the reason your house isn’t selling is not because agents are not worth and eff, its because it smells like dog pee, and it only has one bathroom. Really.

I had two closings this week. Really. First time in my career. One was a house that I listed. The owner is the sweetest eighty year old women you ever want to meet. She is moving to Florida to be close to her daughter. She had lived in the house since it was built in 1951. We had some attorney issues, survey issues, and appraisal issues. (Like any deal there is always something). She stuck through it all like a trooper. She flew off to Florida this morning, and left me a card with a fifty dollar gift certificate to Red Lobster, and a note saying I am the best real estate agent ever. That makes me feel all warm and fuzzy inside. Almost more than the commission check… Really..

Primary vs. Second Home Buyers

As most of my readers, (if there in fact are any, besides my sister) know, I mainly specialize in second home buyers, city or suburb dwellers looking for a weekend/summer place. Every once in a while though, I get someone looking for a primary home. I had just such a family this weekend. A nice couple with three kids, re-locating to our area from Jersey. His company transferred him, and she is going to be working at our local hospital in the O. R.

They knew very little about the area, except that they needed to buy a home, and to be in it by the time the kids are back in school. It was nice taking them around, showing them different areas, and homes. It was a long day, but one that was beneficial.

Since it had been a while, the difference between primary and second home buyers was blatant. First of all, this couple has already made an offer on one of the houses we saw. That has never happened to me with second home buyers. For them it is at least two trips, and very often much more.

I liken it to buying milk and jewelry. If you go to the store to buy milk (a necessity) you will come home with milk, however, with jewelry, it must grab your eye, tantalize you, touch that human urge portion of your brain. That is what will trigger a purchase.

But then some might ask why I don't turn my attention to primary buyers, and in fact after getting such a quick offer, I contemplated that very idea. And the reason is simple. Showing nondescript ranches, and 3.5 bedroom modulars is boring--the dairy section of the real estate industry. I'd much rather work in the jewelry store, where things are more aesthetically pleasing. Sure you may have to work a bit harder, but the environment is better for the soul.

Rust in Peace

After a crazy weekend last weekend, and a runaround day yesterday. I have no appointments today. It was a busy week, and possibly constructive. I have a few possibles. But today...nothing. I'm not complaining, it is a chance to catch up on some things, and relax a bit.



I have a new listing in Delaware County on the Beaverkill. Check it out on my website. I have decided not to really plug my listings on my blog, because it is a little gauche and not what this forum was intended for.



The only reason I bring it up, is I really have not explored that region along Old Route 17. It is a nice area, and it is not far from Roscoe, making it pretty accessible. If you are into trout fishing, I guess that is the spot to go. There were a ton of fisherman out and about, all dressed up in their angler finest. It is an area I plan on paying more attention to. Roscoe really is a cool little town, with Buffalo Zack's, and Live Bait and of course the Roscoe Diner (which is a great spot to meet customers, because everyone seems to know it.)



If you are currently looking, but are one of those leery about stepping over the magic 100 mile from NYC mark, I recommend checking out. It is a little further, but it may well be worth it in price and appeal.



I snapped this shot along Old Route 17. I think it shows the fun, hip feel of the area.





Would love the back story on this. Anyone know?

Listing Homes in Today's Market, and the Passive Aggressive Seller

As a broker that works with both buyers and sellers, it is sometimes a strange dichotomy being on both sides.

Sometimes I am jealous of, and contemplate being a buyers agent. It would seem to be simpler, have an us versus them attitude, and travel around with abject disdain at any and all over priced listings.

There is absolutely something pure and hopeful about meeting and working with a motivated buyer. Newness and discovery, and exploration.

On the other side, selling seems to be a sadder experience. Really the only thing that makes a prospective seller happy when meeting with a broker is the hope that the home is worth what they have heard it may be. Everyone has heard whispers about what it may be worth, but they always seem to cling to the highest. That is until John the Grinch comes along and shatters their illusions.

It reminds me of an incident that happened to me when I was around eighteen or nineteen. I was helping my then girlfriend's family clean out an old barn full of furniture. I discovered a Hank Aaron rookie baseball card from the Milwaukee Braves from 1954. Her family said I could keep it. I had a feeling it was worth some money. But I had no idea how much.

Now this was at around eight o'clock on a Sunday night, in the very early nineties, so there was no way to verify how much the card was worth. There was no google or yahoo or eBay or howmuchisthiscardwoth.com. I had to wait until Monday to call a card dealer.

Now keep in mind that to me this was found money. But throughout that evening the worth of that card ballooned in my head. I spoke to a friend who told me his dad sold a Mickey Mantle rookie card for like $75,000. By the time I went to sleep that night I was a possible millionaire.

It turned out the card was worth around $800. $800 of found money, but by the time I spoke to the card dealer, I was disappointed.

It seems that this same thing happens to a lot of the possible sellers that I speak with. I have a very careful comparative market analyses that I follow, and when I present them with what I feel the home is worth, invariably I get the crestfallen look, and a stony silence.

Now the ones that protest, are easy. I am armed with comps. and reasons and explanations. As part of my listing process, I let the sellers know that if they want to hire a licensed appraiser to appraise the home, I will reimburse them that cost at closing from my commission.

Now I'm sure some of you know my feeling on the appraisal process, but having a house previously appraised makes it much easier once the bank appraiser comes in. Sort of the herd mentality, also it makes it easier during negotiations. "liscensed bank appraisal" sounds very official.

I guess finally I have gotten to the point of this post. Recently I have has sellers agree with me on the price I told them, make it seem as if they are ready to list, and then drop off the face of the earth.

I had one guy who called me to list his property. He had had it on the market for a year prior, with a few bites, but nothing real. I told him that I thought it was priced to high, lets drop it twenty percent, which is still high, considering the market, but we could guage the response. He agreed, I sent him the paperwork, and I never heard from him again. Voicemails went unanswered. Then last week I see it listed on the mls for twelve percent higher then it was originally for. Sorry I did not realize we were in a real estate boom.

I wish him luck. I just feel that agents should not be rewarded for over pricing listings, and then once a realtionship with the seller has been establsihed, massage a reduction. Believe me I have been guilty of taking over priced listings, and all you end up with is unhappy sellers.

I suppose for some it is easier to be passive, and list with a yes ma'am realtor. That way they can hold onto the dream of the big payday for a little longer, which in some cases may be comforting. All I can say to them is good luck.

Olympia Hotel Renovation

It appears as though the renovation on the old Olympia Hotel has slowed for a bit. They have all the new windows in, but the flurry of activity that began the endeavor has subsided a bit.

Perhaps I'm just anxious to see it finished. It really is a grand old building, and it deserves to stand proudly restored over the town. There is rumours of a dinner train that will take passengers from Port Jervis and back while enjoying dinner and drinks. I think that is a great idea, and hope it gets off the ground.

I am wary though. It seems that every year or so, there is some big "happening" in Sullivan County that will put us on the map, and enable us to rival the Berkshires, or the Hampton's. Something that will turn the tide of haphazard dilapidation that seems to dot our landscape.

Now this is on a smaller scale than Cappelli or six giant Indian casinos, or any other scheme that has been bandied about, but it some ways I think it may be more effective in maximizing this areas draw.

I know this has been discussed on other forums, but part of the Sullivan County appeal, is that it is not the Hampton's. A middle class "blue collar" (whatever that term really means) family can afford to buy a second home here. I was just out two weeks ago with a family where the father is a NYC fireman, and last year I sold a little place to a teacher and a toll collector. Sullivan still is affordable enough so that if one saves, a second home is doable.

I seem to have gotten of target, but I guess my point is that if the Olympia is successful, I think that it will enhance the Sullivan experience, and show what this area has been for over a hundred years. A playground for the not so rich and famous. What better way to illustrate that then with a restored old hotel and train station?

Below is an old picture of Callicoon in the early 1900's the Olympia is on the right. I also included the original link to the Democrat article

http://www.sc-democrat.com/news/001January/20/olympia.htm

Bald Eagle Nest in Narrowsburg

On Sunday my wife and I ate at the Main Street Cafe in Narrowsburg, one of our favorite spots. If you haven't gone, I really recommend it. Anyway, when we were leaving, we stopped for a minute at the observation deck next door that looks out onto Narrowsburg Eddy. I spotted a bald eagle way off in the pines across the eddy. Of course I didn't have my camera, so I couldn't take a picture, but through that binocular thingy that they have set up there, you could see there was actually two.





Well I went back this morning, and I managed to get this picture. I believe they are making a nest. The tree they are building it in is the big pine straight across from the observation deck. It is really too far to take a good picture, but I drove down a little closer and managed this shot. I believe it is the male.

Next time you are in Narrowsburg, check it out. Through the binoculars you get a pretty good look, and they really are spectacular creatures.

Amendment of Post Below

I feel I must update my rather harsh post below. The appraiser in question called me, and we spoke at length. He agrees with me that the house was priced well, but he said he just couldn't find comps to support it.

We went back and forth a bit, and I dug up a comparison that was not on the mls., which he used, and lo and behold, the $4,000 gap was bridged, and all is well in real estate land.

I am still convinced that the comparison format to define value is flawed. How can a property ever appreciate if it is only compared to recent sales? It is sort of the chicken or the egg scenario, but there must be a price jump somewhere, to start the ball rolling. Does it begin with someone willing to pay cash to bridge a gap? Then once that property joins the comparison pool, the next buyer doesn't have to come up with as much cash.

And in the reverse, what we are seeing now is the foreclosures dragging down the comp. pool, and deflating value.

Who knows...What I do know is that this time it worked out, but I'm sure I will be in this predicament again. It is just very important to get all parties (broker, appraiser and lender) all on the same page, then at least there is a possibility to work it out.

Appraisal Gaps...A Rant, and Perhaps some Insight

Once again I have an appraisal gap on one of the deals I am involved in. It is a $4,000 difference. I have had a few of these before, but this is the first since the inception of my blog, so now I can rant here, instead of pacing and muttering in my office.

An appraiser is hired by the lender to determine "market value", and to ensure that the collateral is equal to the loan. However, in my opinion, the appraisal process is flawed, and very often the appraiser is clueless, for lack of a better term

The definition of "market value" is: "the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently, and without compulsion."

Now to me that means that "market value" has been determined before the appraiser ever sets foot on the property. A competent real estate broker (i.e. myself) has already evaluated the home, set an estimated sale price, produced a willing buyer, and procured an offer. The value of the property becomes what someone is willing to pay for it.

Now some will argue that it could be a nutcase who is willing to pay much more than the home is worth, so that is where the appraiser comes in, and I agree, but when the appraisal comes in less than 2% below the asking price, are you serious? Can you really believe that the appraisal process is that specific? Of course not, it is a joke.

The first thing the appraisal company asks for is a signed copy of the contracts. So they know the price before they ever look at the house. To me that is ridiculous. If you are so confident in your ability to determine fair value, go in blind. Give me a real opinion, not one carefully crafted around a pre-determined number.

So over $4,000 the deal comes to a screeching halt--1.82% In this unstable market, some would argue that home values could change that much in a few weeks. But rigid banks, and clueless appraisers, cannot see the big picture. It is frustrating.

Now let me say that I have worked with some good appraisers, who get it. And believe me an appraiser who gets it would never turn in an appraisal this close to the price.

It reminds of the type of people who say they can only have Grey Goose in their vodka tonics, and yet in a blind taste test, you know that they will not tell the difference between that and Smirnoff. Self importance to me is one of the most distasteful characteristics, and an appraisal, at 1.82% below ask, screams of self importance.

All right, I feel a little better...