By: Alyssa O'Keefe and Abigail Mago
With the colder weather moving in, a day at the beach may be the furthest thing from your mind. However, if you have been considering purchasing a beach house, the “off season” is one of the best times to do so! Here are five reasons why now is the best time to buy on Fire Island:
1. Time is On Your Side
Buying a beach house in the offseason gives you plenty of time to complete any home renovations or improvements ahead of the busy Summer season. With many Fire Island communities prohibiting construction work during the Summer months, you would have to do any renovations before the peak season starts in July. Buying before year’s end will give you enough time to do smaller scale projects like a kitchen or bathroom update, a new deck, or whatever finishing touches the property you select might need.
2. Decreased Competition from other Buyers
Given the current interest rate environment, many buyers have opted to wait on the sidelines before jumping in to making a purchase. This puts those who are ready to buy now in a favorable position, since there is a lower level of competition. If you are able to take advantage of this opportunity, you will have your pick of inventory. Which brings us to our next point…
3. Interest Rates Aren’t Permanent
It may seem counterintuitive to shop now while interest rates are at high levels relative to the last several years. However, if you do opt to take advantage of the lower levels of competition in the market, you can always refinance your mortgage down the line, when interest rates come down again. As the saying goes, “marry the property, date the rate”. Many lenders are even offering incentives allowing you to refinance your mortgage in the future at zero cost. We have been in an extreme sellers’ market for 3 years and we are finally finding a bit more equilibrium. Because Fire Island is such a unique place, with a limited supply of homes, we don’t tend to experience huge gluts of inventory like other markets do, so when the right property comes along, you don’t want to let the opportunity pass you by just because of a temporary condition like interest rates. Plus, as soon as interest rates do start trending downward again, all of those buyers that have been sitting on the sidelines are going to jump right back into the market, creating another frenzy that will likely cause prices to start climbing again.
4. Inventory is still low, but Improving
Whether you are looking for your first beach house, an upgrade, downsize, or rental investment property, there are homes available ranging from adorable “starter” beach bungalows under $1M to immaculate new construction homes priced at $4M and beyond. The Covid frenzy has eased so inventory levels, while still relatively low, are improving, giving buyers more options to choose from than we have seen over the last 3 years.
5. It’s a Great Investment… That you Can Actually Enjoy
While buying a beach house is a luxury, it can also be a great investment. Whether you choose to rent your property out for cash flow, or just hold on to it for appreciation, investing your money in real estate is a great way to build long term wealth. Historical price appreciation for homes on Fire Island has been extremely strong, and during inflationary periods, owning hard assets like real estate is the best way to defend against your money getting devalued by inflation. Best of all, you can enjoy the property and create lasting memories with your friends and family, while benefiting from that wise financial decision.
Whether you decide to buy now or later, we are always here to guide our clients through every step of the buying process. We recognize that it is our privilege to be of service to you. Contact us today to learn more about the current Fire Island real estate market or to schedule a showing at any Fire Island listing from Kismet to Davis Park.
With interest rates at historic lows, we are seeing most buyers take advantage of low cost financing by obtaining a mortgage for the purchase of their beach house. In many cases, even those with funds available to buy in cash are opting to finance their purchases. Low interest rates also mean that buyers can afford more house for their money. Today we have a guest blog post from local Mortgage Broker Jason O’Keefe discussing the impact of interest rates on loan costs.
When looking into financing the purchase of a property, one of the most important terms of your loan is the interest rate. It is the key component that drives how much interest you will pay to your lender over the life of the loan you obtain.
Say for example you take out a 30 year loan for 400k with an interest rate of 3.75% , you end up paying a total of $326,886 in interest to your lender. However, if your lender issues you a lower interest rate of 2.75% the total amount of interest paid to your lender is reduced to $247,867. That change in rate results in a significant savings of $79,019….
Of course rates vary depending on your credit score, down payment, loan program, and other factors but you can see that it’s imperative to be rate conscious and make sure you are getting the best rate available out there at the time. That is one of the key benefits of working with a broker who can shop your mortgage to multiple lenders across the country, as opposed to limiting yourself to just one or two local lending institutions.
With rates at historically low levels it’s currently a great time to obtain financing for a new home purchase or refinance your existing loan.
In today’s fast moving real estate market it’s very important to obtain a prequalification letter from your lender before making an offer on a property, in fact most realtors require it in order to set up an appointment to view a home.
Always happy to answer any financing questions that may come up, as there are a lot of moving parts when going through the process of purchasing a new home.
Jason D. O’Keefe
InterContinental Capital Group | NMLS # 60134
265 Broadhollow Road, Suite 220
Melville, NY 11747
631-697-3266
jokeefe@icghome.com
intercontinentalcapital.com
Thank you to Jason for guest writing on our blog! We hope this was helpful and are happy to answer any questions.
It’s no secret that things do slow down a bit during the winter months when it comes to real estate on Fire Island. However, if you're a buyer, that’s not a bad thing. While you may have to break out your ski gear to make sure you're adequately bundled up for your house tours, here are some reasons why it's worth it to trek out to Fire Island to snap up your dream beach house this winter:
- Less Competition
During the holiday season, and throughout the winter months, most people just don't have summer on their minds yet, so that makes for fewer other buyers to compete with. Once spring hits and temperatures start to rise, our office is flooded with calls, so why not get a head start? Since there is less buyer activity in the dead of Winter if you choose to look now, you'll have less competition from other buyers, and the seller may be more receptive to your offer at that time.
- Motivated Sellers
Many sellers tend to be more motivated during the Winter months than they are during the Spring and Summer. During the off season, they're not getting use out of their property, but still have to pay the carrying costs on the home, which may make it a little easier for them to part with. Also, if the property is rented out during the Summer, the seller may view that income as a long way away, whereas once Spring rolls around, they are likely less motivated to sell right before rental season.
- Low Interest Rates
Interest rates are still close to historic lows. The longer you wait, the greater the chances that rates will rise. These low rates may very well last through the Spring, but you just never know.
If you're among the savvy buyers looking capitalize on the advantages of shopping now, we're happy to help- we show by appointment 7 days a week, 12 months a year. Just remember to bundle up!
Once you've found the right Fire Island home for you and put the home under contract, the hard part is behind you, but there are a few important steps to take care of before you officially become a Fire Island homeowner. In this blog post, you’ll learn about what steps you should take in preparation for your closing as well as helpful contacts to have on hand. As the closing date for your beach house approaches, make sure to take care of the following items.
Before closing on the purchase of your beach house, it is important to make sure you have proper insurance in place. It is typically most cost effective to assume the previous owner’s flood insurance policy. You should also take out a homeowner’s insurance policy. If you are purchasing the property with a mortgage, your lender will require you to provide proof of coverage before they will issue clearance to close. If you intend to rent out the property, you should also consider purchasing separate liability coverage. Talk to your insurance broker about coverage options. Contact us if you need a recommendation for a good insurance broker who is experienced working with Fire Island properties.
In addition to making sure you have proper insurance coverage in place, you’ll need to change over the utility accounts and put them in your name. Here's a quick checklist of what do to in terms of the home's utilities:
1.) Electric: You’ll want to have a PSEGLI account to change over the day of your scheduled closing. PSEG can be reached at 631-490-0025.
2.) Water: If the home you're purchasing is in the Village of Ocean Beach, then your water is included in your Village taxes so you don't have to set up a separate account. If you're purchasing a home in Seaview, your water bill is included in your Seaview Association dues. If you're purchasing in other towns, call the Suffolk County Water Authority to set up your account. The SCWA can be reached at 631-698-9500.
3.) Television: There is no cable TV service to Fire Island. Television is provided via satellite by DirecTV or Dish Network. Both providers require the previous owner to return their boxes and equipment and will require you to schedule a new installation for your new account. You can contact Dish Network at 800-333-3474 or DirecTV at 800-531-5000.
4.) WiFi: WiFi internet access is available through Verizon Fios. If the seller has Fios, you should be able to use their current equipment and you’ll just need to call customer service to change the account to your name. If the house doesn't currently have Fios, you will need to schedule an appointment for a technician to come out to the property for a new installation. You can reach Verizon Fios at 800-837-4966.
It’s important to schedule a final walk through of the home prior to closing to ensure that the condition of the house is as expected. A walk through is typically scheduled within a few days of the closing to confirm there has been no damage to the house during the contract period.
As a Fire Island home owner, you will likely want to take advantage of the freight boat to ship over items to the island. The freight boat sends over everything from groceries, to bicycles, to furniture, to building materials. You can set up a Freight account online at: https://fireislandfreight.azurewebsites.net/
It is important that any items being shipped on the freight boat be labelled with your name and which town they should be sent over to, as well as the Ferries' address. For example:
Happy Homeowner- Ocean Beach Boat
c/o Fire Island Ferries
99 Maple Avenue
Bay Shore, NY 11706
Bobby Beachgoer- Seaview Boat
c/o Fire Island Ferries
99 Maple Avenue
Bay Shore, NY 11706
If your delivery is received by the ferries before 9:30 AM, it will go over to Fire Island on the same day. If it arrives at the Bay Shore ferry terminal after 9:30, it will be sent over the following day. You should make arrangements to pick up your items upon arrival. If you are shipping over large items, like furniture or building materials, that a contractor or carting company is picking up on your behalf, make sure to let them know when the expected arrival is. You can even track the freight boat by following the Fire Island Ferries' Freight account on Twitter: https://twitter.com/FIFreight
Congratulations on your home purchase and we're delighted to welcome you to this very special community. This is an exciting time and we are happy to help in any way we can. Don't hesitate to ask us for any recommendations service providers and vendors that offer delivery service to the Bay Shore Fire Island Ferries. Welcome Home!
Helpful contacts to have on hand:
Fire Island Ferries
fireislandferries.com
99 Maple Ave., Bay Shore, NY 11706
Main Terminal: 631-665-3600; 631-666-3600
West Terminal: 631-665-2115
info@fireislandferries.com
Freight Information
631-647-3055
freight@fireislandferries.com
Fire Island Water Taxi
631-665-8885
info@fireislandwatertaxi.com
Fire Island Real Estate Office
479 Bayview Walk, Ocean Beach, NY 11770
631-583-5100
info@fireislandrealestate.com
Incorporated Village of Ocean Beach
Village Offices
Bay & Cottage Walks
P.O. Box 457
Ocean Beach, NY 11770
631-583-5940
631-583-7597 fax
info@villageofoceanbeach.org
Seaview Association: 631-583-6212
Electric: PSEGLI - 631-490-0025
Water (Excluding Ocean Beach and Seaview Homes):
Suffolk County Water Authority: 631-698-9500
Television
DirecTV: 800-531-5000
Dish Network: 800-333-3474
WiFi
Verizon Fios: 800-837-4966
Electricians
Coastal Electric: 631-583-7425
Lighthouse Mechanical: 631-583-6500
Plumbers
LOVE the Plumber: 631-583-5612
Conrad's Plumbing: 631-583-5750
Lighthouse Mechanical: 631-583-6500
Fairy House Mother - Fire Island Home Concierge Service
917-968-1007
sabrina@fairyhousemother.com
fairyhousemother.com
Dreaming of customizing your perfect beach house? 692 Ocean Breeze Walk gives you that opportunity! There are endless possibilities at this family home in Ocean Beach. This spacious home, currently listed for $775,000, is an excellent example of a home that you can make your own. Ideally located, 692 Ocean Breeze is just 4 houses from the beach! The home is elevated with an upgraded foundation. Situated on a 50’ x 84’ lot, 692 Ocean Breeze Walk is the perfect opportunity to turn your dreams into reality.
With a large open living and dining area and a fully enclosed porch, 692 Ocean Breeze offer a lot of space to work with. We reimagined the first floor of this home, eliminating the storage room at the rear of the house to create a fabulous chef’s kitchen with large glass sliding doors to the deck. In our proposed floor plan, we demolished the wall where the current stove is to create ample storage space and a large island. By removing the walls to the kitchen to the left of the dining room, this offers a completely open first floor layout and great indoor/outdoor flow, making entertaining a breeze. By adding large glass sliding doors to the deck, the massive great room is flooded with light and seamless indoor/outdoor flow is acheived. You can see an illustration of this renovation idea below in the proposed 1st Floor Plan.
With 5 bedrooms, the second level of the home already offers plenty of bedroom space for your family and guests. The oversized bedroom occupying the entire front of the house presents the perfect opportunity to create a luxurious master suite, complete with a walk-in closet and a private en-suite bathroom. The proposed floor plans below illustrates how you could lay out a new master suite in the space, with just minor modifications to the existing space plan.
These are just a few ideas of how to maximize the features of this ideally located home. One of the best reasons to renovate a home is to get the opportunity to customize it to your exact needs, specifications, and tastes. It is also a great opportunity to build equity in a property, as well planned improvements can increase the property's value in excess of their cost.
This home is exclusively listed by Abigail Mago. For more, click here.
By: Abigail Mago, Licensed Associate Broker
abigail@fireislandrealestate.com
A very common question that I'm asked by buyers is "When is the best time to buy on Fire Island?" Many people assume that the Summer is the peak of the buying season, because that is when the island is busiest, but that's not actually the case. Most serious buyers actually do their shopping during the Fall or Spring months. The best time to buy depends a lot on what your plan is for the home. If you're buying a property and planning to renovate, or are purchasing a rental investment, your best bet is likely to purchase in the Fall. If you're looking for a turnkey home for your personal use, then buying in the Spring is likely ideal timing. There is also an argument to be made for shopping during the dead of winter, when sellers are likely seeing the least showing activity on their properties. Buyers utilizing bank financing should also take the extended timeline required for mortgage processing into consideration.
Whether it's light cosmetic updates to transform a house into a home, or a major structural overhaul, we find that a large proportion of buyers purchase with the intention of renovating. If this is the case, you’ll want to purchase early in the fall to allow yourself enough time to make your desired improvements so your home will be ready to be enjoyed for the Summer season! If your project is more substantial and requires architectural drawings and building permits, it could take several months just for the design and permitting process, so make sure to factor that into your timeline.
If you’re looking to purchase an investment property on Fire Island, you might be tempted to wait until the Spring to close so as to avoid the cost of carrying the house through the Winter months, however that timing might not be ideal, even if the home you're buying doesn't need any work. As a vacation rental homeowner on Fire Island, even though your guests likely won't start staying with you until the Spring and Summer seasons, the booking season actually occurs primarily over the winter months, so closing in the fall is beneficial to allow time for the property to be marketed and booked up in advance of the season. If you wait until the Spring to purchase your investment property, you may run into another complicating factor with respect to properties that already have bookings for the upcoming season. In that case, the rent is prorated in accordance with the date of the closing, providing a large incentive for the seller to push the closing out as far as possible, and a large opposing incentive for the buyer to close as quickly as possible. For example, if the home has $100k of rental income booked for stays between June 1st– Sept. 1st, if the closing occurs in May, the buyer would be entitled to keep all of the rental income. If the closing occurs halfway through the rental period, the buyer would only get to keep half of the rental income ($50k in this example) and if the closing were to occur in September after the rental period, the buyer wouldn't get any of the rental income and the seller would keep the full $100k. If you're shopping in the spring, the seller of a rental property is definitely going to take that into account, so you would likely find yourself in a more favorable negotiating position in the Fall. While you would have to pay for the carrying cost of the house during the winter months, you would still have money coming in over that period, because rent is customarily paid in advance on Fire Island, with a substantial deposit being put down at the time of booking.
If you're lucky enough to find your dream turnkey beach house, in that case the best time to buy is likely in the Spring, so you can move right in and start enjoying! This way you also avoid carrying the cost of the house all winter while you probably won’t be using the home. Make sure you plan for enough time for your mortgage to be processed if you’re purchasing with financing, as many buyers underestimate how long it can take. The fastest mortgage I've ever seen was done in 30 days, but it is much more common for mortgage deals to take up 90 days, particularly with the bigger banks which tend to be slower to get things done.
Many buyers ask what time of year sellers tend to be the most negotiable. Every individual's situation is different, but many sellers will be more eager to sell in the Fall after the close of the season rather than the Spring, when they've just endured a cold Winter and it feels like Summer is just around the corner and they may be eager to enjoy one last Summer at the beach. Additionally, there’s less buyer activity in the dead of Winter so if you choose to look then, you'll have less competition from other buyers and the seller may be more receptive to your offer at that time.
All that being said, I counsel my clients that the time to buy has less to do with the season and more to do with when the right property for you becomes available. Fire Island is a small market with a relatively limited supply, so if a property comes on that meets your criteria, it's usually wise to jump on it. This is particularly true if you are looking for something very specific in terms of location or amenities. If you only want to be in a specific area or if you want to purchase something rarely available like bayfront, oceanfront, a home with a pool, 5+ bedrooms, or an oversized piece of property, and nothing appropriate is available during your initial search, you're best off monitoring the inventory on a regular basis so you won't miss out when the dream house pops up. Be sure to follow us on facebook and instagram for real time listing updates. If you have any more questions about purchasing a home on Fire Island, please feel free to reach out to us. We look forward to the opportunity to be of service to you!
