Suffolk home prices up; Nassau's dip

Home prices were up in Suffolk and dipped in Nassau in December, compared with the same period a year ago, but more houses sold during 2010 than in 2009.

December figures show the median closing prices were less than 1 percent off from a year ago, the Multiple Listing Service of Long Island said Friday. In Nassau, the median price for December was $397,000, down $3,000 from the same month in 2009. In Suffolk, last month's median of $327,000 was $2,000 above the year-earlier price.

December median prices peaked in 2005 in Nassau and Suffolk, before the housing bust.

The median closing price of a home nationally - $168,800 - was down 1 percent from a year ago, dampened by foreclosure sale prices, said the National Association of Realtors.

Long Island sales rose in 2010 for the second straight year, but just barely - by 1.8 percent to 19,441 closings - despite a federal tax credit that pushed many first-time buyers into the market.

Nationwide, sales in December rose 12 percent from the year-earlier period, while on Long Island sales were down 21 percent compared with the same month in 2009. A full-year sales figure for the nation wasn't available.

The Long Island numbers suggest the economy is creeping into a stable zone but needs more time to heal. Interest rates remain relatively low - fixed rates for 30-year mortgages averaged 4.7 percent this week, down from 4.8 percent last week, Freddie Mac said. But credit remains tight, lenders, real estate agents and home buyers said.

The federal incentive for home purchases, begun in 2009, propelled sales. But foreclosures - the owners of more than 13,000 Long Island homes got some sort of foreclosure notice last year - will have a sobering effect on the entire economy.

John Lonski, chief economist at Moody's Capital Markets Group, said sales activity after the tax credit is a better barometer of the housing market than two years of limited growth. Figures show activity on Long Island slowed substantially after the tax-credit deadline for going to contract arrived in April 2010.

"That's what would worry me and perhaps warn of a possible reduction in sales and prices during 2011," Lonski said. "The housing market has yet to prove it can stand on its own two feet without extraordinary assistance from Washington."

Real estate brokers disagree on whether the home sales market here can hold on this year without stimulants like the tax credit.

"The market has reached the point of sustainable levels," said Dorothy Aschkar, president of the Multiple Listing Service of Long Island. "Affordable mortgage interest rates and stable home prices, which, combined with continued job growth and rising rents, will encourage more renters to consider home ownership."

At Winkler Real Estate in West Islip, sales "dropped precipitously" after the federal tax credit expired, and most of the 48 agents made less than the year before, said broker-owner Jamie Winkler.

"My concern is that the American public still does not have faith in the economy, and when people don't have faith, they don't very often like to make large purchases," Winkler said. "They're still scared of losing their jobs and income being cut."

Peter Raneri will lose money on the sale of his East Meadow home, but he says "luck was on my side." A buyer last month signed a contract for $389,000 on the four-bedroom house that Raneri had bought for $425,000.

"We lost money," he said. "I'm upset about that, but I can't complain. . . . There are for-sale signs on houses that I pass and they're still there."