PINE BUSH – The signs are indicating that the real estate market in the Town of Crawford is recovering at last from the huge hit it took in 2007 and 2008.

"In the third and fourth quarters of this year," says Dave Smith of R.J. Smith Realty/Real Estate Solutions, "the market has demonstrated some strong signs toward recovery."

Denise Clancy, Associate Broker at ERACurasi Realty, points to one of the reasons for recovery.

"Average prices dropped from the second to third quarter, but the 'sold's are high. The market was especially busy in the under $200,000 sector. A lot of that was due to first-time buyers equipped with the government tax credit."

"Buyer demand has increased primarily due to the $8,000 tax credit," says Dave Smith, "but also because of low interest rates and lower pricing that brought home values back to levels of four to five years ago."

Ray Zwart, also of R.J. Smith Realty/Real Estate Solutions, adds that "housing has become much more affordable for people that work in our community. We were seeing Pine Bush people moving to Sullivan County, because that was what they could afford."

Denise Clancy identifies two other aspects of the current market situation. "There are the first-time homebuyers, of course, equipped with that government tax credit, but also local people, many of them youngsters — but not all — those who were renting, who have found this an opportunity to move up and own their own home.

"Rentals are up too, and though rents have dropped some, they are high, and they don't usually include utilities. So, people are out $700, $800, $1,000 a month and they have no equity and get no tax breaks. So, as a policy, I always see if I can help renters make the jump to home ownership."

Clancy also sees the market sector that continues to underperform. "The market for homes in the $300,000 plus sector is very slow, still. Short sales and foreclosures continue in this sector and will be with us for years. A lot of this activity is in the 'McMansions,' the larger homes that were the most overbuilt during the boom."

The consequences of the bubble may be with us for a long time.

Clancy suggests that "prices will have to adjust to the new market. But, buying momentum is going forward and I think it will continue in the next two or three quarters."

Ray Zwart concurs, though he doesn't think prices will drop further. "That hasn't been a quiet quarter at all, and I credit the stimulus money and the tax credit, but it went beyond the first-time homebuyers; there were people who wanted to downsize, and there were also people seeking to upsize their homes.

"However," Zwart continues, "purchasers are still very cautious, some think there will be a substantial drop in prices and they're waiting for that, but I don't see that happening."

Meanwhile, Clancy notes that one problem for the market seems to have cleared up. "Banks are lending. And there are some great loans available, like the USDA loan, which offers 100 percent financing."

Looking at the market in the months ahead, Dave Smith says, "I would expect the first half of 2010 to have the same positive movement that we're seeing in the last half of this year. However, the increase in sales activity hasn't tipped the scale far enough to drive prices up yet, although we will reach that segment of the real estate cycle, eventually."