New York Housing Market 2023 Report
What’s the New York Housing Market Like?
The New York State Real Estate market is rebalancing during the third quarter of 2022. Summer activity is usually a very busy time of the year; however, shrinking affordability and economic uncertainty challenged the summer buying season. The Fed’s aggressive monetary policies to curve inflation directly impact the New York housing market as we see the decrease in month-over-month home prices and sales volume.
As of Sept 2022, the median price for a home in the state was $498,900, down 10.1% from the peak of $555,100 in June of 2022. It is clear that the recent steep rise in mortgage rates has curved sales activity and shrunk affordability, and the result has been a drop in home prices.
Sales volume has also dropped considerably. In Sept 2022, there were 13,763 homes sold in the state of New York, a 13.4% decrease from the previous month of Aug 2022, when we had 15,879 homes sold. Comparing year-over-year, we saw an 11.6% decrease in sales from Sept 2021, when there were 15,574 home sales.
The number of sales peak was 17,572 in August 2021; compared to Sept 2022’s numbers, we are down 21.7% in the number of homes sold from the peak of the last five years.
How Does The New York Housing Market Compare to the National Housing Market?
The New York housing market is similar to other markets because supply and demand drive housing prices. New York is also impacted by mortgage rates as the rest of the nation.
New York does have some advantages over other states. The median and average sales prices of homes outside of New York City are quite affordable for a popular and metropolitan state. In fact, the zip code 14618 (Brighton, NY) was named #1 in the “hottest zip codes of 2022” by Realtor.com
New York has a very polarized Real Estate market. You can find a penthouse apartment in New York City selling for $75,000,000, and you can find a quaint little 4-bedroom house with over 1,700 SQFT in the state’s Capital for under $200,000.
The city of New York, world-famous for so many things, including its swanky Real Estate, always comes out ahead even when there are downturns. It is a resilient market with some of the priciest Real Estate in the world.
New York State’s home prices and sales numbers have begun to slow down along with the rest of the country. Differences in the regional economy of some of New York’s metro areas make those markets more vulnerable and others more resilient to the current economics.
New York Metro Areas With the Hottest Housing Markets
The state of New York has seen explosive growth in housing demand in recent years. In fact several regions of the New York Golf Coast experienced 150-300% price growth compared to the national average. Tampa was named the hottest housing market by Zillow earlier this year, and several other cities have made the top 10 in publications such as Fortune and Wall Street Journal.
The top areas in the number of sales are
Suffolk County NY
Home sales in the county have been brisk in 2021 with a slight slowdown in 2022. Suffolk County had the highest number of sales of any county in the state for Q3 2022 with 4,453 sales. This was a 15% drop from Q3 2021. The median price was $560,000, up 6.7% over Sept 2021.
In Sept of 2022, there were 3,669 homes for sale compared to 3.979 for the same period in 2021, a 7.8% drop.
The month’s supply of inventory was 2.5 months in Q3 2022, practically unchanged from 2.4 months in Q3 2021.
Nassau County is the 2nd most active county in NY state. There were 3,589 homes sold in Q3 2022 compared to 4,460 for Q3 2021, a 19.5% drop in sales. The median price was $705,000 compared to $668,750 in Q3 2021, a 5.4% increase.
The number of months supply in Q3 2022 was down slightly at 2.7 months compared to 2.9 months for the same period in 2021.
Westchester County is the 3rd most active county in NY state. There were 2,972 sales for the 3rd quarter of 2022, 13.9% decrease from the same period in 2021.
The median price was $680,000 for Q3 2022, unchanged from Q3 2021. The month’s supply of inventory went from 3.3 months in Q3 2021 to 2.6 months for Q3 2022.
Queens County is 4th most active county in sales in NY. There were 2,735 sales in Q3 2022, a 10.3% drop from Q3 2021.
The median price of sold homes in Queens county was $680,000, up 2.5% from Q3 2021. The month’s supply was 5.5 months, 19% down from the same period in 2021.
Monroe County rounds out the top five counties with the most sales in New York. Monroe had 2,487 sales in the third quarter of 2022, down 10.6% from the same period in 2021.
The median price was $222,000, up 11% from 2021. There was a 0.9-month supply, which was the same as in 2021. It is definitely a hot seller’s market in Monroe County.
Higher Mortgage Rates Could Slow Price Growth in New York
How will interest rates affect the housing market? We are already experiencing the impact of rising interest rates across the nation. Price growth in New York has been flattening or on a slight decline for several months in 2022. However, New York is such a high-demand destination that it may very well fare better than the rest of the country.
As of mid-October 2022, the 30-year fixed rate mortgage is above 7% on average. That represents a 133% increase in mortgage rates in less than nine months. The Feds are on a “no holds barred” approach to curve inflation, and interest rate hikes have become the norm over the last several Fed meetings. Unfortunately, it seems that rate hikes are not done.. We anticipate at least another 2 or 3 rate increases before the year ends.
Key Market Stats for the New York Housing Market:
As of the latest compiled housing report with data through Sept 2022.
- Median home price $400,000 - up 5% from 2021
- Existing home sales:38,743 - a 10.9% drop from 2021
- Months supply of inventory: 3.3 - down 8.3% from 2021
- Mortgage rates as of Oct 13th are at 7.2%
New York Historic price changes & affordability
The New York housing market has seen steady growth and appreciation for years. The last 2 years have been particularly favorable to homeowners as they saw their homes appreciate by 30.7% in 24 months. This was a nice rebound from the decline in values from June 2019 to Nov 2019, which was largely caused by the Pandemic at the time. The county lost 22.1% in value over a short 5 months.
The rebound in home prices and mortgage rates has shrunk affordability across the nation. In some areas, the state of New York is still quite active and affordable. After all, the state has the hottest zip code in the nation for buying a home, as we mentioned previously.
The Bottom Line: Appraised Value Vs. Market Value
- The bottom line while discussing appraised value vs. market value is that both values have their importance. Both values are correct in their domain. The difference between the market value and the appraised value is due to their usage. Knowing this difference can help you to ask the right questions and focus on the correct data.
- The market value of a home is the value a buyer is willing to pay. It is the value the market believes your property is worth. It is important because the buyer will not pay more than this amount. On the other hand, the appraisal value is an amount chosen by a skilled appraiser to assist the lender. The sole purpose of the appraised value is to protect the lender from exceeding the loan.
- Meanwhile, the assessed value is what the government determines your property is worth for taxation purposes. Therefore, no one will be buying or selling at that price. Moreover, this price is according to a formula and neglects many of the unique features of a home. Therefore, you can often apply for a review on this value to reduce your taxes. If you have any questions, feel free to contact us now.