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Second-Quarter 2016 Real Estate Market Report: Westchester County
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.
To learn more about Better Homes and Gardens Rand Realty, visit their website and Facebook page, and make sure to “Like” their page. You can also follow them on Twitter.
Second-Quarter 2016 Real Estate Market Report: Westchester & Hudson Valley Market Overview
The Westchester and Hudson Valley regional housing market surged again in the second quarter of 2016, with sharply rising sales finally starting to have an impact on pricing, particularly in the mid- and entry‑priced markets throughout the region.
Sales. Activity continues to surge, with regional sales up over 26% compared to the second quarter of last year, and rising in every county in the Rand Report. We’ve now had sales going up for over four years, with regional transactions rising in 16 out of the last 18 quarters. Most importantly, we’re now seeing sustained sales increases driving sales totals to levels that rival the height of the last seller’s market, with almost 15,000 single‑family homes and 3,000 condos sold over the past 12 months.
Inventory. Available inventory continues to tighten throughout the region. In the real estate industry, we measure inventory levels by looking at the “months of inventory” available at any given time on the market, and consider anything under six months of inventory as an indicator of a “seller’s market.” Well, we are not yet under six months in any of our regional markets, but we’re moving in that direction, with months of single‑family inventory down 24% in Westchester, 38% in Putnam, 32% in Rockland, 39% in Orange, and 25% in Dutchess. Condo inventory was also down, falling 38% in Westchester, 48% in Putnam, 9% in Rockland, 29% in Orange, and 18% in Dutchess. Both Westchester and Putnam condos are now below six months worth of inventory, and other counties are closing in on the threshold.
Prices. These sustained surges in sales activity are not, though, yet having a widespread impact on pricing. You’ll notice on the accompanying graph that regional average prices have been ticking down for the past year or so. This is a little surprising, given that basic economics tells us that increasing demand coupled with falling inventory should drive prices higher. But we caution you not to read too much into the regional price decline, because the relative strength of activity in the lower priced markets (Putnam, Rockland, Orange, Dutchess) compared to Westchester has changed the mix of properties sold over the past year. Indeed, if you look at individual counties, we had price appreciation in Putnam, Rockland, and Dutchess, and mixed results in Orange. It was only in Westchester that we had prices go down, but even there we believe that the drop was largely caused by a relative lack of demand in the very high end of the market, for homes selling above $3 million. In other words, both the regional price decline and the price drop in Westchester are partly caused by the relative strength of lower‑priced markets compared to higher‑priced markets throughout the region.
Going forward, we expect a robust summer market. The fundamentals of our regional market are strong: demand is rising, inventory is falling, interest rates are near historic lows, and the overall economy is doing fine. Accordingly, we expect that sales will continue to outpace 2015 levels, and believe it’s only a matter of time before the sustained increases in buyer demand start driving meaningful price appreciation throughout the region.
To learn more about Better Homes and Gardens Rand Realty, visit their website and Facebook page, and make sure to “Like” their page. You can also follow them on Twitter.
