Long Island Bank Owned Homes - July Market Trends Report
Bank owned homes are on the rise throughout the nation, including on Long Island, although the numbers are not nearly as high as they are in other markets. This segment of the market predominantly attracts first-time homebuyers and investors, although others are interested as well.
The information provided in this report will include the number of new bank owned homes that came on the market during the month of July, in addition to the first and second quarters. This report also includes the number of bank owned homes that closed during the month of July, in addition to the first and second quarters. Average listing prices and sales prices are also be provided, along with a trend analysis.
If you have any questions about bank owned homes on Long Island, please feel free to contact me directly. If you would like to stay current with the bank owned homes market on Long Island, you can either check back each week for the latest update, or send me an e-mail requesting to be put onto an e-mail list with the updates. My contact information is listed at the bottom of the page.
The following is the market data for the month of July.
LONG ISLAND BANK OWNED HOMES
TREND ANALYSIS: The bank owned market is unlike any other on Long Island. First and foremost, the emotion that is often times a part of a real estate transaction is removed, as the banks have no attachment to the homes that they are selling. While the majority of bank owned homes are located in the less expensive areas of Long Island, there are bank owned homes in a variety of price ranges. For this reason, it is important to note that the average list price and average sales price are subject to fluctuations, and may or may not be indicative of the actual pricing trends.
The most important numbers to look at on the bank owned homes market trends report are the inventory numbers, ratio of sold price to list price and days on market.
INVENTORY - The amount of bank owned homes being listed is clearly on the rise. However, the amount of closings of bank owned homes has risen as well. When looking at bank owned homes, it is important to look at the absorption rates (ratio of listings to closings). In this case, for every 3 bank owned homes that came on the market in July, 2 bank owned homes were sold. This shows that these homes are selling, despite the fact that this is a buyer's market.
RATIO OF SOLD PRICE TO LIST PRICE - Bank owned homes on Long Island are selling, on average, at a ratio of 95-98% of the list price. These are very strong numbers, especially when compared to other segments of the Long Island real estate market. High ratios are an indication that bank owned homes are being priced to sell, which stands to reason since the banks are motivated sellers that do not want to carry inventory.
DAYS ON MARKET - Bank owned homes on Long Island are usually on the market for 90 days or less, however the number rose slightly this month to 113 days. While this number is comparable to some segments of the Long Island real estate market, it is certainly lower than most segments. This is largely because of proper pricing by motivated sellers.
CONCLUSION: Buyers in today's real estate market have been conditioned to think that they have the leverage in a buyer's market. While this is true in a buyer's market, it can be argued that we are actually not in a buyer's market when it comes to bank owned homes. Bank owned homes are being sold at high ratio to the rate at which they are being listed, and selling very close to listing price, in a comparatively short amount of time.
As is the case with all segments of the Long Island real estate market, there are bank owned homes that are priced to sell and those that are overpriced. Buyers must realize that there will be times when there will be multiple offers on a home, sometimes within a matter of days.
Buying a home is just like buying any other product; it's all about supply and demand. There is an increasing supply of bank owned homes on Long Island, but there is also an increasing demand.
CONTACT: Adam Waldman, RE/MAX Best, 631-357-2036, adam@adamwaldman.com
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