June 06, 2007
Reality Checks and Self-Fulfilling Prophecies
Reality Checks and Self-Fulfilling Prophecies
A suggestion from one professional reader: "We keep hearing that nothing is selling save a few pricey places by a few brokers/agents. Agents like to say the market is good sounds better. But what about the real behind the scenes dish that might not be so cheery Why not include a reality check?" (Hmmm! Cheery?)
But is market a reflection of what's written or is what's written a reflection of market?? (Philosophy 101) . . . the dastardly self-fulfilling prophecy?
So I asked brokers/agents for reality checks and was urged by a reader to note that what a broker describes is not a market analysis based on data. (Data, by the way, is often provided to us by George Simpson of Suffolk Research, along with a variety of comments, which we enjoy but sometimes cannot print.)
We were answered! But is this reality?
"We at the Corcoran Group are proud of the best first quarter and the best May in the history of the combined companies. While we continue to dominate sales in the high end of the market we are also seeing an increase in the number of sales in the $1.5M to $4M range, a segment of the market that had been somewhat stagnant in 2006.
"Yes, the very high end of the market has been incredibly strong in the last 18 months, but the middle segment is beginning to gain speed. For us, it truly is a 'cheery' year," says Rick Hoffman regional director, who once again responds promptly. Not what I wanted, Rick. What are the managers and the agents saying? Are they all cheery?
From Barbara Weinman, more to the point. "Hampton Homes is good; we have three houses in contract, two over 2 million and one over 1.5; we are happy. Did very well on rentals."
Paul Brennan at Prudential Douglas Elliman writes: "Lona, it appears that overall market is sporadic. We have had two exceptional months in Bridgehampton and the rest OK. Southampton and East Hampton have done consistently well each month. Southampton is over the top!!! Overall the Hamptons are outpacing the rest of Long Island. Six out of the 10 top offices are from the Hamptons. Still I don't feel an overall surge in the market. It's not awful but it lacks momentum." Thoughtful. Thank you, Mr. Brennan.
And now the ever-reliable George Simpson: "You don't have to put the whole nine yards, just summarize it. The jist of things is the high end has been relatively unchanged for the recent period." (We will go the distance with the supporting data, next week.) "In terms of the high end, East End high end has been about the same in '07, '06, '05 before that, less big houses sold."
George adds: "I agree with you about things 'turning into self-fulfilling prophecies.' I'd stick with the numbers from established sources . . . publishing what salesmen think is 'going on' doesn't do anyone any service."
From Gioia DiPaulo, Prudential Douglas-Elliman Sag Harbor: "I saw some great activity over the Memorial Day weekend! New customers, ready to buy in the $3M to $8M range, but I've also had a string of buyers over the past months making low ball offers and not being able to buy. These buyers are terribly misguided in thinking there are bargains to be had. None of the sellers I'm working with are desperate to sell."
Lori Barbaria, Prudential star broker, says, "I have four closings coming up. But everyone has their own reality; the ones complaining are creating theirs by their very words. Maybe the market is not on fire and exploding, but it's solid and still quietly scintillating. What is sparking today can always catch fire tomorrow. This is mostly a second home market. Remember they don't need to be here; they want to be here. No one needs a Range Rover either, they want one. Who wouldn't want to be in the best place?"
(Some interesting prose! Lori has just written a book; more on that next week.)
Judi Desiderio owner and broker of Town & Country Real Estate says: "You are so on the $$$$. I'm going to have 'real agents' respond directly who are out there doing what you and I built a career on 'SELLING.' Big real estate corporations spend all their time, energy and $$$ training agents to list they forgot what's most important."
Judi's real agents Richard Swift, Chris Diamond, Linda Battincella, John Heaney, Bill Stoeker and partner Jen Wilson did not get back before our deadline . . .
So looking forward to hearing from those real people, in real time, with real experiences, doing reality checks in an unreal market where 40 unimproved acres sell for over $100 million.
East End real estate? A very strange business.
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