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Sluggish Market

Real estate industry coming off slow year

May 1, 2011
By MIKE ZUMMO , The Leader Herald

Slowly, the area real estate market is inching its way back to health.

According to a news release from the New York State Association of Realtors, the Real Estate Sentiment score among New Yorkers in the first quarter of 2011 is -26.6. However, that mark is 5.4 points above last quarter.

A score of 0 would indicate an equal number of New Yorkers showing optimism and pessimism on the real-estate market.

Article Photos

A home on Woodside Avenue in Gloversville is listed for sale by Virginia M. Mackey Realty on Thursday.

The Leader-Herald/Mike Zummo

Locally, the real-estate market is showing a small increase over two years ago. Even so, broker Virginia Mackey of Virginia M. Mackey Realty in Gloversville said 2010 was the most challenging year of her 44-year career.

"Changes in the banking system have caused an extreme slowdown of purchases in the area," she said.

In Fulton County, 11 houses were sold in both February 2009 and February 2011. Fifteen were sold in February 2010. However, 24 houses were sold in January, resulting in a 54.2 percent drop from one month to the next. Over the past three years, however, the median sales price of a single-family home has increased from $95,000 to $109,950 in the county.

The story is different in Montgomery County. While statistics show a 10 percent increase in home sales in February over the same time in 2009, only one additional single-family home had been sold. Twelve were sold in February 2910. Over the same period, the median sales price of a single-family home has dropped by 4.1 percent.

"There is no reason for the market not to be much more active than it is," James Ader, chief executive officer of the Greater Capital Association of Realtors, said in a news release. "We have low interest rates, a large inventory of homes and pent-up buyer demand. This is a wonderful time to be a home buyer."

One problem Lana Ruggiero of Ruggiero Realty in Gloversville pointed to was the weather. The region saw a snowy winter and until the past week, spring hadn't really taken hold.

She said there are some properties she has listed in Caroga that had 2 feet of snow on them until recently.

"You get a day of nice weather and people would make appointments and then we'd get 2 or 3 inches of snow and they would cancel," Ruggiero said.

Mackey said the buyers are out there and she said she still has a lot of listings, some of which have come down in price. She said even while interest rates are low, lenders have become much more cautious after the mortgage crisis.

On Thursday, the average national rate for a 30-year fixed mortgage was 4.8 percent, and a 4.02 percent for a 15-year fixed mortgage, both up 0.7 points from the day before. The rate for an adjustable-rate mortgage was 3.61 percent.

NBT Bank, one of the most widespread banks in the area, listed mortgage rates on its website as 4 percent for a 15-year fixed mortgage with an annual percentage rate of 4.1 percent. The bank listed rates at 4.875 for a 30-year fixed mortgage with a 4.93 APR, staying in line with national averages.

"Underwriters have become extremely picky," Mackey said. "Buyers have to jump through hoops on a regular basis to get to the closing table."

Ruggiero said the banks aren't the only ones that need to loosen things up so buyers can purchase a home. Local municipalities and school districts also need to get property taxes under control, she said.

"[High property taxes] lessen what they can pay for a house," she said. "If they're looking at $400 a month [in taxes] and that's added to mortgage, that will definitely have them looking at lower-priced properties."

However, both brokers said they are optimistic about 2011.

"I just have to feel optimistic, especially with the regionalization of the area, with the [GlobalFoundries] chip factory in October," Mackey said. "I think that will be good to the area."

"If we see slight improvement, that will be good," Ruggiero said. "That's why the area didn't see the huge decrease, because we never saw the boom that some parts of the country saw. To get us back there, it's going to happen as long as we see slow improvements. Slow and steady wins the race."

Mike Zummo can be reached at



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