Millennials, HGTV changing
the real estate
marketplace, experts say
Jenny and Brian Goodness were searching for a home in the $250,000 range in Fairport last fall.
Having purchased a fixer-upper in Greece for $77,000 three years earlier, they were more selective about what they wanted in a home. Eventually they opted to have a home built.
“We love the idea of creating whatever we want in a new home,” said Jenny Goodness, 25, who is a registered nurse.
Their choice reflects the transformation HGTV and millennials are having on both the Greater Rochester and state real estate markets.
“The demographics of millennial buyers will boost housing over the next few years,” said Gary Keith, chief economist for M&T Bank.
Keith was the keynote speaker at the 2018 Economic Breakfast and pointed to a demand in housing due to the onset of millennials looking to buy and to rent.
Meanwhile, the president of the New York State Association of Realtors says HGTV has ruined real estate.
Christine “CJ” DelVecchio said today’s millennial buyers want a home that’s turnkey and ready to move-in, prompted by the HGTV shows that depict gorgeous homes.
“They don’t want to pick up a paint brush,” DelVecchio said.
Contrast that with a boomer population that’s holding off on putting their home on the market or may have some cosmetic upgrades they’d like to make and you now have a low inventory issue, continuing from 2017 and carrying into this year.
Those factors may have had an impact in the Greater Rochester region, where sales of existing single-family homes fell 2.9 percent in 2017 as the market coped with the low inventory.
Still, that tighter market helped boost the median sale price, which was up 4 percent to $130,000 in 2017, according to the Greater Rochester Association of Realtors (GRAR).
Jim Yockel, GRAR (Photo: Mary Chao)
“There are tons of buyers out there, but something is keeping homeowners from selling their homes,” said Jim Yockel, CEO of GRAR.
The inventory of homes for sale in the region fell 12.4 percent in 2017 compared to 2016, with 3,135 homes on the market versus 3,578 in 2016.
The national economic climate, fueled by a bullish stock market and improving job prospects, helped the industry despite the lack of inventory.
Last year saw multiple offers for homes in good condition that were priced accordingly, said Bob Maves, manager at Howard Hanna’s Pittsford office. Despite the demand, buyers were cautious and would not overpay, he said.
The market is strong all around but it is price sensitive, with median-priced homes selling quickly in all towns and suburbs. But homes over $300,000 are staying on the market longer, Maves said.
There are many factors at play when it comes to when homeowners are not selling, Maves noted. Baby boomers may not be able to find the right home to downsize to, the high property taxes in the state and some homeowners may not have much equity if they bought during the peak of the market in 2004 through 2006, he said.
The 19th Ward in Rochester is a popular area for real estate sales. (Photo: Mary Chao)
The region is experiencing low unemployment while seeing increases in wages, Keith said. The median household income moved from the $51,000 range during the recession years of 2008 and ’09 to $56,300 in 2017. The unemployment rate in the Rochester region was 5.3 percent in 2017 versus 4.1 percent in the U.S., though uncertainty at large companies such as Xerox Corp. may upset the apple cart in 2018, Keith said.
Rochester’s tight market isn’t reflected statewide.
New York state saw a record number of houses sold (134,066 homes) for the second year in a row in 2017. And that marked the fifth year in a row of growing sales, according to the state Association of Realtors.
Home sales were up 2.4 percent, about 3,000 homes, in New York state compared to 2016. And the median sales price last year was $250,000, up 5.5 percent from 2016, the group said.