CPF down, but could numbers reflect Island turnaround?
If early 2019 Community Preservation Fund numbers are any indication, Shelter Island could be seeing improvement in its real estate market.
Numbers just released by Assemblyman Fred Thiele Jr. (I-Sag Harbor) show that the Island CPF revenues for January are still negative — down by 28.6 percent from $140,000 for the same month last year to $100,000 this year. That’s a significant improvement, however, since through most of 2018 the Island was reflecting a more than 40 percent downturn.
CPF revenues come from a 2 percent that tax that buyers pay when purchasing East End properties and is used in turn to purchase open space for preservation and fund water protection programs. The CPF numbers, monitored and released by Mr. Thiele, are solid markers of real estate market trends.
What Island real estate professionals are projecting is that deals that either closed too late in 2018 to be reflected in the CPF numbers, or deals closing in the first quarter of this year, will show a turnaround.
On the other hand, the overall CPF revenues for all five East End towns are showing a 44.8 percent decline for January 2019 compared with the same month last year.
This year, the towns took in $5.47 million in the taxes paid by property buyers as compared with $9.91 million at this time last year.
It represents the lowest monthly total in the nearly six years since March 2013 when $4.19 million was generated in CPF funds, Mr. Thiele said.
“It’s impossible to determine trends based on a single month of CPF revenues,” the legislator said. At least a quarter of a year of data is required to determine if the drop in January is an aberration or a significant change in the real estate market, he said. He advised local officials to closely monitor CPF revenues in the coming months and not to make any long term projections.
At the same time, Mr. Thiele noted that the stock market had its worst December since the Great Depression in 1931. The stock market rebounded this January, and the Dow Industrial average has increased for nine consecutive weeks for the first time since 1964.
Looking at CPF revenues for the other four East End towns in January 2019, Mr. Thiele reported that only Riverhead was on the plus side, up by 24 percent in January 2019 compared with January last year.
The most significant drop was in East Hampton, which experienced a 52.6 percent decline in January 2019 compared with the same month last year. Revenues went from $3.02 million last year to $1.43 million this year.
In Southampton, CPF revenues were down by 46.6 percent, bringing in $5.71 million for the month in 2018 compared with $3.05 million this year.
Southold was down 25.6 percent, garnering $780,000 last year compared with $580,000 this year.
