By Melissa Stagnaro
Special to The Evening Sun
CHENANGO – Amber Lanfair and Eric Wells are excited about buying a home for their growing family. Or at least they were when they started the process.
Lanfair remembers the mix of emotions they felt when they went to look at the first prospect on their list.
“The first time, we were very excited,” she said. They had a number of questions swirling in their minds – would they like it, would it be big enough, would it require too much work. And, most daunting, would they be able to afford it?
They’ve seen a growing list of homes since that first foray into house hunting, but have yet to find what they’re looking for: a single family home with a nice backyard in the Oxford school district for under $100,000.
There have been a few with potential, but in each case, something wasn’t quite right. One was too close to Route 12, she said. Another, too close to Oxford’s wastewater treatment plant. Yet another shared a driveway. Two needed to be completely renovated.
But their biggest frustration isn’t the inability to find their dream home. It’s the whole process. They started out navigating it alone, without a realtor. Which means they’ve found out a few things the hard way.
One of the disappointments they’ve encountered is that their combined income exceeds the guidelines for grants administered through Opportunities for Chenango.
“With both of us working full time, 40 hours a week, we have too ‘high’ of an income,” she said.
Despite this fact, they’ve struggled to prequalify for a mortgage.
“There never seems to be a home loan specialist in the office,” she said, “and they don’t even always return our phone calls.”
And, while their combined income precluded them from getting the grant assistance, the banks they’ve spoken to won’t qualify them together, Lanfair explained. Neither makes enough to qualify on their own.
According to Gretchen Walsh of the Parker Walsh Team of Keller Williams Realty, the biggest challenge a potential buyer can face is not being pre-approved for a mortgage. Getting that pre-approved is one of the first things she recommends for those she works with.
“When a buyer finds the home they are ready to buy, it is important that they are ready to act,” she explained. “A pre-approval letter is proof to the seller that the buyer can afford the home and they are serious about the purchase.”
According to Walsh, now is actually a good time for first time buyers to enter the market.
“With many financing options available and interest rates remaining at all time lows, it is a great time for first time home buyers to explore home ownership,” she said.
Matching them up with existing housing stock can also be a challenge, because of the age of homes in Chenango. According to numbers released by Commerce Chenango, a full 42 percent of houses in the county were built before 1939.
While most buyers don’t mind making a few cosmetic improvements, like painting and decorating, having to put in a new kitchen or bath can be a deal-breaker.
“If a house needs updating, I find that they can be a more difficult sell because very few buyers want to invest money in upgrading,” Walsh said.
Upgrading can be a Catch-22 for sellers, however.
“In our market, very rarely do we see sellers get 100 percent return on investment on improvements they’ve made to their homes,” Walsh said, so homeowners often think their home is worth more than buyers are willing to pay. “Understandably, this is often difficult for sellers to stomach.”
That said, an updated property is less likely to sit on the market.
“If a house is in good condition, needs little work and is priced competitively, it can sell in as little as 30 days,” she said.
According to Walsh, 179 houses have sold in Chenango so far in 2015. The average home spent 166 days on the market, and sold for $103,858.
There is one portion of the property market that isn’t moving. Walsh says sales of higher end homes – which she classifies as anything valued over $175,000 – are stagnant because there just aren’t a lot of buyers looking in that price range.
“Right now we are not seeing a tremendous amount of higher-end jobs coming to the area, so unfortunately that affects sales in the higher-end market,” she explained.
When out-of-town buyers do come to Chenango, she says they are often impressed by ‘how much house’ their money will buy. However, there are two things they aren’t impressed with: the lack of new construction, and the taxes.
“People are often shocked at how high our taxes are, and in some cases as a result, they choose not to invest here,” Walsh said. “They’ll say to me it’s hard to justify a monthly tax payment that is equivalent to what their monthly mortgage payment will be.”
PROPERTY TAX ASSESSMENTS
Adding to the issue, especially when newer homes are taken into consideration, is the fact that the majority of Chenango’s townships – 12 of 21, have not had a reassessment this century. (13 of 22 if you include the City of Norwich.)
Ten of those townships haven’t done a full reassessment since the entire county was reassessed in 1976. Stephen Harris, Director of Chenango County Real Property Tax Office, says that at least three of those towns have done some kind of adjustments in the intervening 39 years, but not in conjunction with the state.
New York State recommends municipalities use a 4-year reassessment cycle. Why?
“To crate equity,” Harris explained.
When assessment inequities exist, some property owners may end up paying more than their fair share. This is especially true when a home has been constructed or a property has changed hands since the last reassessment.
This is something that Mike McCormack is very cognizant of as he tries to sell his home in Aurora Hills. The development falls in North Norwich, one of the towns that hasn’t done a reassessment recognized by the state since 1976, although Harris stated that some readjustments have been made. And as a former out-of-town buyer himself, McCormack knows all about the sticker shock of Chenango County taxes.
McCormack and his wife moved to Chenango 10 years ago when MeadWestvaco purchased Day Runner. A vice president at Day Runner, McCormack was brought in to help with the transition.
“We love Norwich,” his wife Joann said. They have many friends and involvements in the Norwich community, and enjoy the close proximity to their daughter and her family in Clinton, New York.
Now, however, they’re ready to move closer to Clinton, so they can spend even more time with their grandsons. They’re also ready to downsize, they said, trading the house they say is too big for just the two of them for a more modest home that requires less maintenance. This will allow them more freedom of movement so they can visit their other daughter more frequently, as well. She and her family live in West Virginia.
It was with all this in mind that they decided to put their house on the market.
The 3,800-square foot home sits on a five-acre lot, just a few minutes outside of the City of Norwich. It’s a showpiece property featuring four bedrooms, three and a half baths, a large kitchen with granite countertops, a three car garage, a large deck perfect for parties, an outdoor fireplace and even an impressive tree house, which they built for their grandsons. They listed the property at $399,000, and expected to have a buyer within 6 to 7 months.
“That was our horizon,” McCormack said.
The couple started looking for their next home right away, and managed to find exactly what they were looking for shortly after their house went on the market. It was the right size and the perfect location - in close proximity to their daughter in Clinton and situated on a golf course.
“It was perfect,” McCormack said.
The couple put an offer on the house, which was accepted contingent on the sale of their Norwich house.
That was two years ago, and they have yet to have a serious offer. Their option on the other home has long since expired.
“We don’t even look anymore,” McCormack said.
They’ve recently dropped the asking price to $329,000, and are hoping this will change their luck even though they’re aware only a handful of homes have sold within that price range in the last 2 ½ years.
“It’s slowing down our retirement process,” he said. “It’s a speed bump we didn’t expect.”
THE DREAM OF HOMEOWNERSHIP
Like Lanfair, many people dream of homeownership. But according to Daniel Auwarter, deputy commissioner of Income Maintenance Services at Chenango County’s Department of Social Services, it’s a dream that’s becoming more elusive.
“Chenango’s homeownership rate is statistically higher than the state average – 76 percent versus 54 percent statewide,” Auwarter said, “but that being said, it’s clear that people are finding the dream of homeownership harder to achieve.”
Across the country, homeownership rates are shrinking and more people are renting than ever before, he said. The reasons for this vary based on demographics and geography.
“Those living near or in poverty may rent because they cannot afford to purchase a home due to credit, income and more recently the housing market bubble and crash,” he explained.
At the same time, Auwarter says that rental rates have climbed, and income levels have not kept pace. He cited statistics that almost half of those that rent spend 30 percent or more of their monthly income – which equates to around $600 a month - on housing expenses..
“Locally we know that rents can be much higher than this, and as demand for rental units increases, the economics of supply and demand kick in so that a $600 a month apartment soon becomes an $800 apartment,” he said.
“A family may have to move farther out to find suitable and affordable housing, which increases their travel costs to work, school, or other needs.”
Auwarter says he considers housing to be one of the most pressing concerns for Chenango County, because it’s interconnected with so many other issues.
“To me it’s not necessarily just about economics when it comes to housing; it is also about identity, safety and security, and stability. It is about communities that are stable instead of constantly in transition,” Auwarter explained.
“It’s about communities where people maintain roots versus ones where people constantly move in and out, either to chase opportunities or because they are forced to.”