HGAR: Suburbs staggeringly good; NYC real estate far from dead
“I”™ve been in this business now for 35 years and what we saw this year, to me, was staggering,” Richard Haggerty, CEO of the Hudson Gateway Association of Realtors and president of OneKey MLS told a webinar on the condition of local real estate markets.
Haggerty summarized HGAR”™s latest report on Lower Hudson Valley real estate during 2020 with emphasis on the fourth quarter of 2020, noting substantial increases in the number of single-family homes sold.
“We had a very strong first quarter. Even though we pretty much shut down real estate and only operated on a virtual basis in the middle of March, the first quarter was still pretty strong,” Haggerty said. “Obviously because of the shutdown the second quarter was pretty much nonexistent.”
Haggerty reported that for the year, Westchester ended up 14% higher in the number of single-family homes sold, Putnam was up 20%, Rockland up 14.7%, Orange County was up 8.5%, Sullivan County was up 25.8% and the Bronx was down 10%.
“So given the fact that we really didn”™t do any significant transactions in one whole quarter those numbers to me are just staggering and it was all fueled by the fourth quarter,” Haggerty said. “I do think the recovery we saw is just staggering and it really did, I think, help the New York state economy when all is said and done close out a strong 2020. In terms of price increases, there were price increases all across the board but the largest by far was a 37% price increase in Sullivan County, which just shows you that people were heading out to the suburbs including the more rural suburbs.”
HGAR”™s fourth quarter report shows that Westchester saw 6,657 single-family homes sold during 2020 compared with 5,839 in 2019. There were 2,232 single-family sales in the fourth quarter compared with 1,415 sales in the same period during 2019. The median price of a single-family home in Westchester increased to $735,000, compared with $655,000 for 2019.
In Putnam, 1,261 homes sold in 2020 compared with 1,050 in 2019. The median price was $380,000 compared with $358,000 in 2019. Single-family sales in Rockland totaled 2,327, as compared with 2,028 in 2019. The median sales price of $500,000 was up over the 2019 median of $455,000. Single-family sales in Orange County totaled 3,984, up from 3,673 in 2019, the highest number of single-family sales ever recorded for one year in Orange. The median sales price in Orange was $330,000, the highest since 2007 and up from 2019”™s $277,250. Sullivan County had 1,232 single-family sales compared with 979 in 2019, with a median price increase to $195,000 from $142,500 in 2019.
Condominium unit sales were mixed, but prices increased in all markets both for the fourth quarter and year over year. Condo sales were down by 6.8% for the year in Westchester, but up 37.3% in Putnam, up 7% in Rockland and down 11% in Orange.
Jonathan Miller, president and CEO of Miller Samuel Inc., described the rental market in New York City as still being crushed.
“Look for a ”˜V-shaped”™ recovery and V stands for vaccine. True stability doesn”™t really happen until people feel safe,” Miller said. He said the Manhattan residential rental market has been down about 22% in terms of net rental rates recently and he”™s seen some segments down as much as 40%.
Softness in pricing, Miller said, has now stimulated an increase in people moving into the city because apartments that were priced out of reach have become more affordable.
“We”™re not seeing the same intensity of price decline in the sales market. Prices are clearly softer and tending probably toward more softness this year but it all is going to be predicated on when people feel comfortable being in the city,” Miller said.
“When we think about the suburban market and the rocketship of demand that counties like Westchester and Fairfield and then Nassau and Suffolk, the counties around New York, have seen obviously, as Richard was pointing out, basically a rocketship of activity skewed to the end of the year. You can”™t forget that part of the pent-up demand was because mortgage rates fell to the floor. I tend not to overemphasize rates but … the condition you”™re seeing in these counties is the same you”™re seeing in suburbs across the nation; it”™s sort of correlated very closely with rates themselves.”
Bess Freedman, CEO of Brown Harris Stevens, said that they have noticed increased contract-signing giving real estate agents a collective rush of excitement.
“It was quiet, it was a little spooky in the beginning. We didn”™t know what to expect. It was an unprecedented event for all of us,” Freedman said. “I live on Second Avenue. The restaurants; people are sitting outside even though it”™s very cold out and I think that”™s wonderful that they do that. I”™m seeing a tremendous difference in what the neighborhood looks like versus March and April. We still have tremendous headwinds but I feel it”™s like we”™re at the beginning of the end.”
Joe Rand, chief creative officer at Howard Hanna-Rand Realty noted that there has been a trend toward people not leaving the city but rather buying second homes in the suburbs. He referenced Sullivan, Columbia and Ulster counties.
“Those aren”™t people moving to the suburbs. Those are people getting second homes that they can drive to,” Rand said.
Miller pointed out that previously when people were looking for second properties about an hour or more from the city they were looking for a weekend getaway. Now, he said, people have experienced changes in their lives that demonstrate they don”™t have to commute to the office every day.
“During 2020, many started to look at these markets as a place that they could live at any period of the year for any length of time … because of Zoom,” Miller said. “Markets in the Hudson Valley, much like Florida and other markets that were seen as seasonal or not year around, that”™s all being rethought now.”