The number of luxury sales in New York City’s northern suburbs fell 33 percent over the last six months when compared with the same period last year, according to the 2019 First Quarter Luxury Market Report from Houlihan Lawrence.
Westchester County experienced the steepest drop, with sales of properties worth $2 million and higher down by 38 percent. In Fairfield County, sales of properties $3 million and higher in Greenwich and $2 million and higher in Darien/New Canaan saw declines averaging 28 percent.
Luxury sales in Putnam and Dutchess counties remained unchanged from the same period last year.
According to Houlihan Senior Vice President, Director of Private Brokerage Anthony Cutugno, there was no isolated incident that accounted for the losses, but rather a confluence of events that negatively impacted the markets and effectively shrunk the number of luxury buyers north of New York City.
“The real estate market in New York City has softened, resulting in fewer buyers leaving the city to head north because their apartments remain unsold,” Cutugno said. “This important feeder market was robust just 18 months ago. Condos, co-ops and townhomes appreciated in value, sold quickly, and reliably drove buyers leaving the city to the area. Now, listings are sitting on the market longer as inventory grows, selling for less than expected.”
Houlihan’s data indicate a 40 percent decline in the number of New York City buyers moving to the suburbs year-over-year.
Another factor in the luxury market dip are new limitations on property tax deductibility stemming from the new federal tax law, making home ownership less affordable, according to the report. Many would-be move-up buyers, an important sector in the luxury market, are now more likely to stay in their current home, perhaps adding a bedroom or renovating the kitchen, rather than trade up to a larger and more expensive one, it said.
Continued confidence in the economy is evident in the rebounding stock market and a stable interest rate environment, Cutugno said.
There were exceptions over the past six months, he said, noting a $9.1 million off-market sale at 8 S. Manursing Island in Rye – the highest price per-square-foot sold in the area. The broker said that deal indicates the area remains attractive to luxury buyers and that there are still deals happening even at the ultra-high end.
Michael McCooey, a Houlihan Lawrence agent, had represented the seller in their original purchase of the waterfront property in September 2017, which closed at $7.4 million. After razing an existing residence on the parcel and choosing to build anew, the owners ultimately decided to move on and listed the land for sale at $9.8 million.