Supply and demand at work in single-family home sales

Single-family home sales in Westchester for the first quarter of 2022 were down 20.1% from the first quarter of 2021, while Putnam and Dutchess posted declines of 33% and 21.3%, respectively, according to a new report from real estate brokerage firm Houlihan Lawrence.

Forcing the number of home sales down was a lack of inventory, with the number of properties available in Westchester dropping 30%, while Putnam saw a 15% decline and inventory was down 38% in Dutchess.

The shortage resulted in a typical supply and demand reaction with median sale prices up 2.1% in Westchester, 24% in Putnam and 7% in Dutchess, according to the report.

Houlihan Lawrence found that in Larchmont, 29% of the buyers in the first quarter of 2022 came from New York City, whereas back in the first quarter of 2020, the segment of buyers that had come up from the city reached 50%. Dutchess County also saw a sharp drop in the number of buyers coming from New York City as compared with the first quarter two years ago, in 2020. Back then, 29% came from New York City while in the first quarter of 2022 only 8% were from there.

One of Houlihan's luxury properties at 1251 Flager Drive, Mamaroneck. — One of Houlihan’s luxury properties at 1251 Flager Drive, Mamaroneck.

“Today”™s supply and demand ratio indicate that the market will remain a strong seller market for the foreseeable future,” said Liz Nunan, president and CEO of Houlihan Lawrence. “If a house is lingering on the market under these conditions, it is very likely (because of) the price.”

Supply and demand continued to help explain what happened in the luxury end of the market in Westchester, Putnam and Dutchess counties in New York and in Greenwich, Darien and New Canaan in Connecticut.

In Westchester, there was a 17.9% increase in the number of luxury homes sold, from 84 in the first quarter of 2021 to 99 in the first quarter of 2022. The median price went up 3.4% from $257,138,997 to $320,633,847. The number of luxury sales Putnam and Dutchess combined was unchanged at 41 in both the first quarters of 2021 and 2022, with the median sale price dropping 21.5% from $1,625,000 a year ago to $1,275,000 in the first quarter of 2022.

In Greenwich, the median sale price in the luxury market went up 6.3%, from $3,975,000 a year ago to $4,225,000 in the first quarter of 2022, with 60 homes sold compared with 70 in the first quarter last year, a 14.3% drop.

Darien saw a 29.6% jump in the median sale price for luxury homes from $2,662,000 to $3,459,000 with 19 units sold, a 46.2% increase from the 13 sales in the first quarter of 2021.

In New Canaan, the median sale price for luxury homes rose only 1.9% from $2,260,000 in the first quarter of 2021 to $2,650,000 in the first quarter of this year. The number of units sold dropped 33.3% from 30 in Q1 of 2021 to 20 in Q1 of 2022.

“The majority of Westchester”™s first quarter luxury sales closed below the asking price, demonstrating that price sensitivity is a reality,” said Anthony P. Cutugno Sr., vice president and director of private brokerage at Houlihan Lawrence. “If a listing is languishing on the market, it is often a sign that pricing should be revisited to capitalize on this robust, but not always euphoric, market. Looking forward, the lack of inventory will not correct itself soon. One of many factors contributing to the supply deficit is sellers”™ hesitancy to list their home for sale. They are concerned about securing a new home that meets their needs in this environment, perpetuating the shrinking supply of homes on the market.”