LI home sales fall for 7th straight month

A file photo of a home for sale on Carman... — A file photo of a home for sale on Carman Street in Patchogue. (Feb. 13, 2011) Credit: Kathy Kmonicek

By ELLEN YANellen.yan@newsday.comFebruary 16, 2011

Long Island home sales fell for the seventh straight month in January, said the Multiple Listing Service of Long Island.

And the median closing price for Nassau, Suffolk and Queens was $360,400, down 1.3 percent from $365,000 a year ago, MLSLI said.

Snow storms in December and January helped freeze house-hunting and home-showing activity beyond the regular winter doldrums, agents said. Nassau had 581 closings, a 16.4 percent drop from a year ago, while Suffolk had 651 closings, an 11.4 percent drop.

"I was seeing very, very quiet open houses through the last part of last year," said Mary Alice Ruppert, associate broker at Realty Connect USA in Hauppauge. "Now, the snow has kind of wreaked havoc on the month of January."

But the dampening of sales started last spring, right after the deadline for the federal home-buyers tax credit, which has been blamed for even sharper drops in monthly closings last year. To get up to $8,000, buyers rushed to sign contracts by April 30, pulling more sales into the first half of 2010.

But Ruppert and other agents said they've been hustling this month because interest rates have been moving up, reaching an average of 5.05 percen nationwide last week on 30-year mortgages. Buyers want homes before lending costs rise too much, they said.

Broker Kevin Leatherman said he's seeing multiple offers on half the "priced right" listings, including 12 on an Oceanside fixer-upper.

"I think there's a false sense in the market that you can pick something up on the cheap," said the broker owner of Coldwell Banker Surf in Rockville Centre. "Don't think you're the only option for the seller."

John Lonski, chief economist at Moody's Capital Markets Group, said the housing market is at a critical turning point. Rising interest rates and falling sales can combine to freeze any housing recovery, he said. If spring is a flop in sales, he said, it could sour the upbeat views for this year.

"We can tolerate lower home prices provided that sales grow," he said. "What is intolerable would be the return of simultaneous declines by unit sales of housing and home prices. You would risk entering into a downward home price spiral."

Last month's data showed a "natural oddity," said the Multiple Listing Service of Long Island. The median closing price for Nassau, Suffolk and Queens combined fell from a year ago, but rose for each county: $420,000 in Nassau, $318,750 in Suffolk and $375,000 in Queens. This statistical oddity can happen when more sales come from a county where prices are usually lower, in this case Suffolk, the group said.