Housing market sees steep drop in sales volume
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Not spared from the nation”™s “economic maelstrom,” Westchester County”™s residential real estate market last year saw a 26 percent drop in sales from 2007 levels, according to the Westchester-Putnam Multiple Listing Service in its end-of-year report.
That plunge followed a year in which the county”™s residential market held its own in a slumping economy and battered national housing industry, posting sales that were only 2 percent less than 2006 figures.
Realtors in the bi-county listing service reported 6,639 sales in Westchester in 2008, the lowest level reported since 1995. Fourth-quarter closings were down 27 percent on a year over year basis. When seasonally adjusted, the forth-quarter rate amounted to 6,140 sales per year, a nearly 10 percent decrease from the previous quarter, according to the report.
As Westchester County Board of Realtors CEO P. Gilbert Mercurio noted in his analysis for the report, the fourth-quarter closings do not reflect the impact of “the economic chaos” that began last October. That damage to the market cannot be measured until the close of this first quarter of 2009 at the earliest.
Despite the steep sales decline, the median price of a single-family house in Westchester averaged $650,000 for the year, a drop of 5 percent or $35,000 from 2007. The mean or average price of a single-family house in 2008 was $881,793, a 6 percent drop.
The median sale price of a condominium was $385,000 in 2008, down 1 percent, while cooperatives sold at a median price of $185,00, an approximately 3 percent drop from the previous year. The average price of a condo last year, $433,295, was almost unchanged from 2007. The average price of a co-op last year was $205,863,down 4 percent.
The largest drop in both sales volume and prices for the year was seen in multifamily housing. Sales of two- to four-family houses dropped 34 percent year over year in 2008, to 286 units, in a continued decline from the boom year of 2005, when 842 multifamily houses sold in the county. The 2008 median sale price for those houses was $463,750 and the average price was $475,381, both down about 15 percent from 2007.
In the fourth quarter of 2008, Realtors reported 750 single-family houses sold, down 27 percent from a year ago. Closings on condos dropped sharply, with 193 units sold, a 44 percent drop. Co-op sales dropped 17 percent and sales of two- to four-family houses dipped 3 percent.
As relatively stagnant trading in 2008 swung the Westchester real estate market in the buyer”™s favor, sale prices dropped more sharply in the fourth quarter. The median price for a single-family house fell to $570,000, an 11 percent decrease a year ago. The average sale price for a single-family house in Westchester was $745,127, a 17 percent drop.
For condos, the fourth-quarter median sale price was $355,000, a 7 percent drop from a year ago. The average fourth-quarter price of a Westchester condo was $393,560, a 12 percent drop.
Housing priced at $1 million or more accounted for 15 percent of sales, compared to 18 percent in the fourth quarter of 2007. For the year, the million-dollar-plus sales sector accounted for 22.8 percent of Westchester house sales, down from 25.4 percent in 2007 and 24.7 in 2006. That high-end sector last year lost market share for the first time since the Westchester-Putnam Multiple Listing Service began tracking those sales in 2000.
Westchester had an end-of-year housing market inventory of 5,392 units, an increase of 383 units or about 15 percent from the end of 2007. Despite an increase in foreclosures in the last two years, there is “no glut” of properties listed for sale in the county, the report noted. The current inventory is far below the 8,000-unit levels of the early 1990s.
Mercurio in his report analysis said unemployment in the financial services sector is a particular worry for Westchester and Putnam counties and its full impact on the real estate market “is not yet known.” However, unemployment is not as high here and the economy is stronger than in most areas of the country and above-average household income here leaves potential home buyers with better credit scores and more likely to obtain mortgage loans.
“Westchester housing prices are in rare retreat and are presenting a more affordable prospect to moderate-income and first-time buyers,” his report concluded. If federal economic stimulus programs restore public confidence in the economy, that combined with the bi-county area”™s economic strengths and historically low mortgage interest rates “could combine to move Westchester-Putnam real estate out of recession as quickly as we entered it.”