NORWICH – Home ownership remains one of the largest wealth building opportunities for most Americans, and one of the most valuable assets we may own in our lifetime.

“Moderate income and above-average credit allow most anyone to take advantage of this opportunity,” said Kevin Walsh.

Kevin and Gretchen Walsh have been brokers and owners of The Parker Walsh Team since 2007. They list and sell properties in and around Chenango County.

“The recent rise in interest rates has slowed the market from its post-COVID height in 2021.” Kevin said.

Residential statistics for previous years in Chenango County show fewer sales as some home buyers wait out the high interest rates, but the value of homes in the area have significantly increased since 2019 and remains strong.

The average sale price of homes was $119,000 with 320 properties sold in 2019. This was considered a strong year for Chenango County real estate.

In 2020 the overall statistics were similar to 2019 with 311 residential sales in Chenango County. The first half of the year was very slow due to the shut down from COVID.

Chenango County experienced a record breaking year in 2021 with an average sale price of $156,000. A total of 441 properties sold. The increase in value went up 31 percent and transaction numbers were up by 38 percent.

Last year in 2022 , we encountered a large decrease in numbers of sales but moderate increase in average sale price. Transaction numbers were down 23 percent, yet value increased by three percent.

Gretchen said, “So many people watch the national news, but real estate is local. Our area has a different pulse compared to the national market.”

The National Association of Realtors predicts 4.78 million existing home sales in 2023, down from 5.13 million in 2022. Housing market prices are expected to decline a bit in 2023 as well, but not dramatically.

“The reality of the current interest rate situation is that current rates have normalized from what was an unprecedented floor in the three percent range. The average historical 30-year mortgage rate is just above seven percent, with the current 30-year mortgage rate hovering in the six percent range," Kevin said.

"So, from a historical perspective, we are still experiencing favorable mortgage rates. The shock factor after having rates in the three percent to four percent range for an extended period of time, created a perception that an interest rate nearing seven percent is outrageous. The reality is that it is still lower than the historical average.” He added.

Abe and Cindy Karney just moved to the area. They are excited to join the community yet hesitant to buy right now.

Abe said, “We used to own a home but sold it to move here. The profit from our sale wasn’t much and we used most of it to move. Our agent showed us a couple houses but the prices are too high for us.”

“We’re going to wait for awhile to buy” Cindy said.

Jack Thyfault from Northeast Realty agrees the market has slowed down but stated we’re still not feeling the effects.

He said, “ I had buyers approved for $80,000 yet unfortunately we have few homes for sale at that sale price. Some decent houses under $100,000 are in flood zones. Flood Insurance monthly payment will be added to the mortgage payment and this can create a higher mortgage payment. Lower income buyers can be approved through FHA or USDA loans, which allow a minimal down payment but their guidelines are very strict. Homes cannot have peeling paint, broken windows, things like that.”

“There are lenders that can help homebuyers work on credit to pay off or down obligations and Grants are available to contribute to down payment and closing costs.” he added.

Thyfault said, “In our area, it has always been an issue with our local buyers that what they’re approved for is not for sale. There are more opportunities to negotiate as there are less houses on the market but old market effects will keep prices high for some time.”

“There remains a nationwide and local shortage of homes, which is currently the primary factor keeping the market relatively strong. Transaction numbers are down due to the low inventory of available homes, but properties continue to sell much more quickly and for greater values than what our area had become accustomed to pre-COVID. Due to low inventory, multiple-offer situations are still occurring and many homes [are] selling above list price," Gretchen said. “It's a great time to sell.”

“There certainly are situations where renting makes sense, but from a broad perspective, I have always looked at renting as paying interest 100 percent, as it offers no opportunity to build equity," Walsh concluded. "And that percentage certainly makes six percent seem low."

“In spite of some media doom and gloom for a national perspective, the local market has remained strong from a value perspective. Even with significant increases in home values in Chenango County, the overall affordability of Chenango and Otsego Counties relative to many other areas of the country continues to draw interest from out-of-area buyers," said Kevin.

"Downstate New York and New Jersey continue to pull the largest percentage of these buyers, but post-COVID has also given us interestingly high number of buyers from the southern and western parts of the country."

"While winter cold and snow are not for everyone, I believe that the issues other areas of the country contend with — limited water supply, drought, wild fires, hurricanes, intense heat, and devastating floods — will continue to draw interest to our areas we have historically not tapped into," he added.