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The regional housing market in the New York City metro area continued to slow in the second quarter of 2023, with sales falling but prices maintaining historic highs. Going forward, we still expect sales to level out in the latter half of the year at close to 2014-15 levels, while severely low levels of inventory will continue to drive price appreciation through the end of the year.
– Joe Rand, Chief Creative Officer at Howard Hanna | Rand Realty
Sales continued to fall below pre-pandemic levels. Closed sales fell in almost every county within the report and were down sharply compared to last year’s second quarter for each region – falling 22% in Westchester and the Hudson Valley, 22% in Northern New Jersey, 17% in the Bronx, and 24% in Fairfield County. Similarly, pending sales that went into contract during the quarter, which provides a leading indicator of future closings, were also down, falling in each county (other than the Bronx) and in each region.
Indeed, even while sales continued to fall, pricing was relatively strong, with some counties stabilizing but others still appreciating. Compared to last year’s second quarter, regional prices were down 4% in Westchester and the Hudson Valley and 5% in the Bronx, even though many counties in the region were up. And prices in Connecticut and New Jersey were fairly robust, with Fairfield up 9% and Northern New Jersey up 5% for the quarter. Meanwhile, over the longer term, virtually all the counties and the regions saw price appreciation for the last 12 months, reaching yearlong historical highs.
We continue to see a severe inventory shortage throughout the region. We measure inventory by looking at the average number of homes that we sell each month and then calculating how many months it would take to sell out the current stock of homes for sale. According to industry standards, six months of inventory marks a “balanced market” – anything less indicates a tight seller’s market.
Going forward, we believe that sales will eventually stabilize and that low inventory will continue to drive price appreciation. That’s not because we believe that the market is going to significantly strengthen, but only because we will be measuring off a much lower baseline, not off the strongest market in history. Accordingly, we believe that the market will hold to that 2013-2015 era level of sales, with low levels of inventories propping prices up near their current levels through the end of the year.
If you have any questions about the current state of the real estate market, please get in touch with your preferred Howard Hanna | Rand Realty Real Estate Agent.
Discover the complete real estate report for your area by clicking on the links below and selecting your county.
Q2-2023WestchesterAndHudsonValley
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