The Westchester housing market surged in the second quarter of 2016, with sales activity up sharply but prices down slightly because of continued weakness in the ultra high‑end.
Sales. Market activity exploded, with single‑family sales up over 22% from last year and now up over 12% for the rolling year. Year‑on‑year sales have now risen in 17 out of the last 19 quarters, with rolling year closings crossing over the 6,000‑transaction level for the first time in over 10 years. We saw the same thing in the condo and coop markets, with coop sales up over 10% and condos up over 20% from last year.
Prices. Even with this continued strength in buyer demand, though, prices were still down from last year, falling almost 3% on average and 2% in the median and price‑per‑square foot. Part of this is simply a change in the mix of properties sold, with sales softer in the higher‑end markets: $3M+ sales are down about 44%, even while sales for homes priced at $500,000‑and‑below are up over 25%. Indeed, we see the same dynamic in condos and coops, with pricing in the lowest‑priced coop market up almost 7% at the median even while the mid‑priced condo market is depreciating slightly.
Inventory. We are still seeing declines in inventory levels, which are now hovering near the six‑month level that signifies a seller’s market. Single‑family listings were down 24% to 6.7 months, and inventory is even tighter in the entry‑level markets, down to 6.0 months for coops and 4.0 months for condos.
Negotiability. The negotiability indicators demonstrate that sellers are gaining leverage with buyers. The days‑on‑market were down for all property types, at about the five‑month level for single‑family homes and condos, and the listing retention rate rose across the board. With homes selling more quickly and for closer to the asking price, we would expect to see more upward pressure on pricing.
Going forward, we continue to believe that the fundamentals in the Westchester market point to appreciating prices by year‑end. With inventory tightening, pricing at 2004‑05 levels, interest rates near historic lows, and a generally improving economy, we expect that the strength in the lower‑end of the market will eventually expand throughout all price ranges.