Here’s a post that makes some good points about the Hamptons Market
|The Hamptons – A Buyers Market
Cliffeton Green and Drew Green
“Obviously, the current world financial atmosphere has everyone very concerned about their financial well-being. We now know that it is the sub-prime mortgage crisis that was a primary cause for the current economic uncertainty. Subsequently, Wall Street has seen a meltdown with the loss of some of the industries oldest and most respected names. In turn, Main Street has been affected. It sounds like the sky is falling – yes? Not necessarily, the answer is that for “some” these are indeed hard times, but for others the current economic atmosphere presents opportunity!
As of Friday, Oct. 10 the Dow Industrial dropped below 8,000 (roughly 40 percent lower than its all time high, which was slightly above 14,000 a year ago). Of course, unlike Wall Street, a minute by minute measuring of the real estate market is not possible. However, we do know that on average prices are down roughly 20 percent in the Hamptons from their all time highs of a year or two ago.
Many experts are suggesting that we are at or near the bottom of the market on Wall Street and that there are now good buys to be made. The same can be said for real estate. Frankly speaking, Wall Street influences the Hamptons real estate market more than any other outside influence, and if Wall Street is indeed at its bottom, the Hamptons real estate market cannot be far behind. Simply put, we are now in a “buyers market” and the time is now for those of you who have been looking for the opportunity to get “a deal” (how many of you have uttered those words to us over the past 15 years). If there was a home that intrigued you recently, “make an offer” even if it might be perceived as being a low offer. This is even more relevant today. Some owners are more anxious than their asking price would suggest.
If you are a seller in this market, you need to seriously evaluate your reasons for wanting to sell. The current atmosphere is obviously not conducive to garnering the same return it might have a year or two ago and you must be prepared to accept that. Experts suggest that home sellers need to assess the prices of similar properties on the market and then price their home 10 percent to 15 percent below the competition (if you “really want to sell”).
If you are a buyer and in need of financing, completing a savvy real estate purchase is difficult, but not impossible. In speaking with many mortgage brokers over the past few weeks, each has suggested mortgage applicants need three things currently – an “excellent” credit rating, proof of income over the past several years, and, probably most important, the ability to make a large down payment on the purchase (25 percent to 30 percent). If you are in this position and have been considering a Hamptons real estate purchase, “NOW” is the time you have been waiting for! Currently, “cash is king” and if you have it, you are in the driver’s seat.
A trend that we are now seeing more of is “owner financing.” This is advantageous for both buyers and sellers alike. It is advantageous for the buyer who is having difficulty getting a mortgage through the traditional sources. The current advantages for a seller are numerous:
If you are in a strong financial position and are interested in buying Hamptons real estate, don’t wait for someone or something to tell you the bottom has been reached. If you are waiting for that moment, you will miss it. The fact remains that in the long run, real estate always proves to be an excellent long-term investment, especially in the Hamptons. When compared to other investment opportunities, real estate makes sense in uncertain times for the following reasons:
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