As experienced Realtors, we knew the local real estate market around Woodstock VT would bounce back - eventually. Despite cries that "This time it's different!", we knew it was deja vu all over again. Markets move in long cycles, and most memories fade quicker than that - which of course is why they cycle back up eventually.
The last significant real estate downturn of the late 80s/early 90s took years to fully recover from. That downturn was precipitated by overleveraging, junk bonds, the advent of a new securitized mortgage market and incompetence at savings & loans - and fueled by aggressive Wall Street firms like Drexel Burnham and others - which sounds awfully familiar... But while our real estate market in & around Woodstock VT saw a nice run-up in prices, it did not see the tulip-crazed run-up experienced in areas like Florida and Las Vegas, nor the excessive leveraging and bad loans. Yes, our local real estate market has seen a trickle of foreclosures, but nothing systemic. In short, we never saw the big run-up - - nor the big collapse. But the recession did bring with it a reduction in pricing - from the peak levels - of approximately 25-30% - from our best estimation. And the number of houses that have been selling each year plummeted, making it hard for those wanting/needing to sell, to move ahead with their lives.
But notwithstanding the "pause" introduced by Irene, we saw the recovery starting to happen in the first half of 2011. And with the area back to normal by summer 2012, real estate sales picked up where they left off before Irene, as evidenced by the graph below. Admittedly, this pickup occurred primarily in more moderately priced homes, but that is typical of a recovery - grass grows back more quickly than trees. Only two properties in our area sold in 2012 at valuations above $1 million, for example. But there was a pickup in buying in the $500,000 to $1 million range (our firm had several sales in 2012 between $700,000 and $1 million). And post-election, we have seen a pickup in activity for buyers in the $1 million + price range. Things take time, as they say. And we remain confident and proud of the strength that our local market has displayed during what has been a difficult 4 years for many. - John Snyder