The Southern Tier is like a fallen leaf, dried up and scattered to the wind, destined to be mulch, its people trapped in a vicious cycle wrought by Cuomo.
One of the favorite canards of the anti-fossil crowd ( canard – an unfounded story, not to be confused with the French “quacking duck” from whence it derives) is that areas where natural gas is developed suffer declines in real estate values.
This is patently false. Real estate prices always decline in areas that are depopulating. This leads to oversupply and the inevitable fall in values. Why do people leave an area? Largely due to lack of opportunity and high taxes, and in some cases, exacerbated by bad weather and rising crime.
Case in point that hits close to home, so to speak.
I was chatting with a friend who works for a local gas company and asked when they would be moving to Susquehanna County for a shorter commute. The answer was “not soon.” For over a year their house in Elmira, New York, has been on the market – and even with repeated reductions – not even a nibble.
Here are the particulars. The house was purchased in 2006 for $209,000. It is a 2,300 square foot, 3 bed/3 bath on 1.1 wooded acres.
It’s in move-in condition with $70,000 in improvements; new siding – windows – propane furnace -shed – well pump – hot tub coupled with beautiful landscaping.
The listing price has been reduced multiple times and is now at $199,000. That’s just a bit over $80 per square foot. Appreciate that to build a new house with standard construction is about $150 per foot, not including land.
And, what are the real estate taxes on this unsaleable property?
To add insult to injury – they pay for garbage removal, have their own water well and septic system and are covered by volunteer fire. Not to mention no kids. They rightfully ask that age-old question – “What in the world are we getting for our tax money?”
They are trapped and must take a $100,000+ hit to escape.
In contrast, where I live in Montrose, real estate is doing quite well with an agent, it seems on every corner. And if you haven’t heard, Susquehanna County is at the epicenter of natural gas development.
So, the next time you hear an energy protester complain, tell them I have a lead on a nice house in Elmira for them. No gas. Quiet, secluded, cheap and dying.
Editor’s Note: Just for fun, I decided to check the US Census stats on median home values for owner-occupied housing in Chemung County, New York (where Elmira is located) and Susquehanna County (where Montrose is located). The American Community Survey is used by the Census Bureau to make annual estimates. It includes owners’ estimates of their own home values. Sample data is obtained and analyzed to determine the median home value on a rolling 5-year basis. The figures are for all existing homes and not just those of homes that are on the market and most homeowners are reluctant to admit their homes may have lost value, of course.
What the data shows is that Susquehanna County estimated home values are now some $52,300 higher than Chemung County. Moreover, the gap is widening. Here are the Census stats adjusted for inflation between 2009 and 2016:
Notice that Chemung County home values are going nowhere, relatively speaking. They increased in real dollars by a mere $7,418 or 7.9% over the seven years of the shale revolution it was denied by Andrew Cuomo. Meanwhile, Susquehanna County, Pennsylvania home values increased by $22,708 or 16.7%. The Susquehanna County gain was more than three times that of Chemung in absolute 2016 dollars and more than twice as much in relative terms.
There’s more, though. The New York State Office of Real Property Services calculates median residential sales figures from actual transactions and posts the latest three years by county. It shows the following for Chemung County:
This just confirms Chemung County is going nowhere. As Chris has said, real values are most likely going down for homes above the median. It’s a vicious downward cycle created by Andrew Cuomo where attempts to appease metro voters with politically correct but insane fractivist policies have not only deprived Southern Tier of opportunity, but also made them the worse choice to live by comparison with Pennsylvania. There is no reason to stay and those who do are left with ever worse financial burdens.