CNY home values slowly inch higher

CNY Business Journal (1996+), Dec 28, 2001 by Fitting, Beth

While construction companies are kept busy with new builds,

appreciation rates of houses in the area rank among the lowest

in the nation. According to the Office of Federal Housing

Enterprise Oversight, in the last decade, home values in the

Utica-Rome and Syracuse areas experienced some of the

lowest appreciation values in the nation. Appreciation rose

only 8.7 percent in Utica-Rome and 9.8 percent in Syracuse.

Across the nation, the average appreciation for the decade was 51.6 percent.

Steven Essig, president of Essig Appraisal Associates in Cicero, can chronicle the slow rise in values. He's been in the business 30 years. Essig says that, 10 years ago, in 1991, "we were just starting to see the effect of the recession on housing prices. They peaked out in the late '80s, early '90s. Business slowed, building permits dropped, sales dropped, values were sliding." It "bottomed out," says Essig, in 1995 to 1996. He adds that the number of Realtors in the area "was down to its lowest level from 2,200 in the mid to late '80s to 700 in the mid '90s. "Then, he says, in 1997, "things stabilized." And in 1998, values began to appreciate. He notes, "it was different in different areas of Central New York."

Today, says Essig, "all Onondaga County is doing pretty well. The biggest jump in prices is in new builds. Homes selling in the mid $90,000s a few years ago are now $125,000. In early 1998, the price per square foot was $75 in the northern suburbs. In 1995 to 1996, it was $60." And now, he adds, "in the eastern and western suburbs" (Fayetteville, Manlius, DeWitt, Camillus), it's "$90 to $100 per square foot."

Andrew Doherty, Syracuse operational manager of Buffalobased Kirchmeyer & Associates, Inc., says, that in "the Greater Syracuse area, there has been an across-the-board modest appreciation. In certain price ranges [$130,000 to $200,000], it has been 3 percent to 5 percent. In fact," he adds, "earlier in the year, in the summer, there was a shortage of houses. But the effects of 9/11 are yet to be felt. Some Realtors say that buyers are holding off."

Essig notes that the events of Sept. 11 "stopped things for a short while. But since dim there's been lots of refinancing, because of low interest rates, as well as new builds."

Appraisers, says Doherty, are "busy in refinancing. There's a lot in the pipeline for mortgages and regular bookings." He adds that "the city [Syracuse] is flat. In some suburbs, Clay, Cicero, Manlius, dim's modest appreciation."

Doherty says that the situation in Syracuse is "better than a couple years ago," thanks, he says, to a new home-equity guarantee that the house will hold its resale value. When the national and regional economies improve, he says, the market "should somewhat awaken. Low interest rates are the primary motivator."

Time on the market has also improved, says Doherty. "It's much stronger than three to four years ago. The time on the market is now under 60 days; two years ago, it was 60 to 90 days."

Essig thinks it's encouraging that the Parade of Homes, sponsored by the Home Builders Association of Central New York, will be located in the northern suburbs this year. (The Parade of Homes showcases high-end new homes in a specific development.) "This is good," says Essig. "It hasn't happened since 1994 or 1996. There are high-priced areas now [in the northern suburbs]. I believe they [the Home Builders Association] are trying to create a focus on the northern suburbs. There's abundant land there and a reasonable price per square foot." Essig concludes, "I think they're seeing in the recession and in the national picture a necessity to refocus. Rather than focus on the $300,000 new home, start with one at 200,000."