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WPCNR HOME FRONT. Special to WPCNR from Hudson Gateway Association of Realtors and Houlihan Lawrence realtors April 14, 2014 UPDATED 3: 40 P.M. E.D.T.:
Westchester single home sales spurted 20% in the last quarter. Houlihan Lawrence of White Plains indicates this may be fool’s gold and attributes this increase in sales and prices to a low inventory of homes available (creating the higher prices).
Hudson Gateway Association of Realtors noted in their report that “In a high sales rate and tight inventory environment, prices could be expected to increase- and they did. The first quarter median1 sale price of a single family house in Westchester was $600,000, an increase of $85,000 or 16.5% over last year’s median.
Westchester, which accounts for about 60% of the region’s real estate sales, led the way with a powerful 19.4% sales increase in its single family house sector, and 21.0% in its cooperative unit sector.
Westchester condominium sales did not follow suit, however, declining by 15.2% from last year.
The region’s surge in real estate sales since early 2013 continued stronger still in the first quarter of 2014.
However Houlihan Lawrence of White Plains in their report shared with WPCNR Monday afternoon, wrote county closings in first Quarter of 2014 were down 11% because of snow:
“To a large extent, the strong pace of Q1-2014 closings reflects deals that were
originally put together late in 2013. Meanwhile, the snowy conditions delayed the
traditional February start to the spring market. Fewer sellers listed their homes for
sale in February, creating an inventory crunch that kept buyers on the sidelines
waiting for more options. This scenario is most obvious in Westchester County,where we ended February with fewer than 2,600 single-family homes for sale, representing the lowest inventory level at that date since 2005, and a 10% decrease from 2013.
As a result of these delays, pending sales as of the end of the (1st) quarter (2014) were down over 11% in Westchester County compared to Q1-2013.
Similarly, Dutchess County saw a 7% decrease in pending sales, while Putnam County only experienced a 3.1% decrease in this time period. Sellers who did test the market during this period found their properties selling at higher prices — and in much less time — as is evident in the16.4% decrease in average days on market.
A surge in activity in late March is helping to make up for lost time. We experienced
strong growth in both new listings and new sales contracts into the close of the
quarter.
By the end of March, inventory levels were down just 2%, signaling the rise
of a busy late spring.
Overall, we expect the year-over-year rate of sales growth to slow in Q2, and indeed
throughout the remainder of 2014. With most of the market area having returned to
healthy sales levels by 2013, the favorable comparisons we saw as the market
emerged from the down turn are now behind us.” (This, from Houlihan Lawrence)
Realtors participating in the Hudson Gateway Multiple Listing Service, Inc. reported a grand total of 2,552 closed residential transactions in the MLS’s core four-county service territory in January through March, an increase of 10.8% over the 2,304 closings in the same period last year.
The increase from 2012 to 2013 was 8.8%, and compared to the recessionary performance of only 1,582 closings in 2009, the 2014 volume was 61.3% higher.
The first quarter closings resulted largely from properties that were listed and marketed during the late autumn and winter months of 2013.
The next highest year to year increases in residential sales were posted by Putnam (11.9%), Rockland (7.7%) and Orange (4.2%). In all three counties the sales gains were largely in the single family house sector. In contrast – and as in Westchester – condominium sales were lower by about 15% in Rockland and Orange, and were unchanged in Putnam (though Putnam condo sales usually are few in number, e.g.,19 as per this report).
The robust sales levels kept the pressure on to maintain the region’s inventory which, at 10,014 listed properties2 at the end of the quarter, was 3.9% lower than last year at this time. In the single family house sector, Orange posted the largest decrease (6.3%), followed by Westchester (3.2%), Putnam (2.6%), and Rockland (0.7%).
Not all of the increase derived from competitive market pressure, however. Some reflected the addition of more high end properties to the real estate market basket. Such properties (defined in this report as single family houses selling for $1,000,000 or more) constituted 23% of house sales in the first quarter of 2014, a level that was more characteristic of pre-recession markets. Last year’s first quarter ratio of high end properties was just 16%.
Rockland and Putnam exhibited the same upward price movement as Westchester, just at lower price levels. In Rockland, the $380,000 median sale price of a single family house was 6.1% higher than last year’s $358,000. In Putnam the increase was 11.0%, taking the median price to $318,000.
But Orange closed the quarter with further slippage in its median price for single family houses, to $219,000, down 3.1% from 2013. As previously reported by this MLS, Orange County continues to deal with a higher proportion of stressed properties in its sales mix, which brings the averages down. However, one current positive indicator for Orange is that its first quarter mean1 sale price – $250,842- was 5.4% more than last year’s, suggesting that some more highly priced properties entered the sales mix there.
Overall, the lower Hudson region’s real estate market appears to be shedding the last of any remaining baggage from the recession that bottomed sales and prices in 2009.
With some few exceptions there is now strong pent-up demand by buyers in most parts of the region, in all price ranges, and among all residential property types.
The larger economy is a supporting factor in our now-recovered market. Mortgage interest rates are still very affordable at around 4.5% for a thirty year conventional loan.
Unemployment throughout the region is down by one to two percentage points from a year ago. And the equity markets including the Dow Jones have been setting new records. Real estate can thrive in that environment and based on this first quarter performance the lower Hudson market is poised to do so.