Twenty-seven percent of all home sales in the last month of 2013 went to first-time homebuyers, according to the National Association of Realtors (NAR). That is the lowest level since the NAR started tracking such data in 2008.
First-time homebuyers usually purchase lower-priced homes for their first house. On Long Island, many took advantage of the decrease in prices that occurred before the end of the year. Multiple Listing Services of Long Island reported that, in December 2013, the median home sales price was at $360,000 – a 2.7% decrease from November 2013 – and the median price for pending home sales was at $350,000, which is 1.4% lower than what it was the previous month.
But that’s not all: the National Association of REALTORS reported that, last month, existing U.S. home sales fell to a seasonally adjusted rate of 4.62 million units – an 18-month low and a 5.1% drop, both off last month’s pace and year over year. Home sales on Long Island fell sharply by 25.3% from 2,893 in December 2013 to 2,159 in January 2014. Long Island pending home sales last month was 16.7% off the previous month’s pace; only 1,933 home sales were in contract in January, compared to 2,323 in December 2013.
Both the NAR and MLSLI cited the terrible winter conditions as the reason for the poor home sales, but both organizations anticipate a rebound once the weather warms up.
Other challenges first-time homebuyers will face include a decline of housing inventory on Long Island, which will soon result in higher home prices, and a growing number of institutional investors buying with cash to pay for these houses. Available residential inventory on Long Island was up 3.1% last month after a 12.7% decline two months ago, according to MLSLI, but it is 14.6% lower than in January 2013. According to RealtyTrac, 42.1% of all purchases were cash-based.
Since 2006, Charles Rutenberg Realty has specialized in residential sales in the New York market. Its 900 Agents have the experience to help first-time homebuyers purchase the house they have always wanted and stay within their budget. In addition, the Agency’s “Done For You” Short Sales Division features Agents who can help first-time homebuyers understand and go through the very complex process of a Short Sale purchase. Using the latest technology, Charles Rutenberg Agents work well with inexperienced buyers by providing them with the freshest information available to assist in making their search effortless.
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