Buyers Are Heating Up The NYC Suburb Real Estate Market
Some people from out of state may imagine New York City real estate only thriving in the heart of the city, however, in 2016, the market heated up considerably in the suburbs. New buyers are making their way to the more spacious commuter neighborhoods as the sudden surge of activity is having a significant impact on available home inventory.
Busy Housing Market Winter
Normally, the housing market can slow down when the winter weather hits the New York area. This year, buyers have hit the streets in force searching for homes during the mild winter days. The housing inventory has decreased substantially as homes are spending less time as listings – numerous bids are being made by buyers and accepted by sellers.
Places such as Pleasantville has homes sitting on the MLS real estate listings for 83 days before going to contract, and the Westminster suburb has an average of 3.7 months for its absorption rate. Inventory has dipped so low that there were only 34 homes on the listings in the Pleasantville area. Long Island has recorded its lowest inventory levels in 13 years. On average for most suburb areas, there is only three months’ worth of home inventory available.
Home Prices Steady at Beginning of Year but Expected to Rise
Steady prices have brought buyers out in droves to find the best deals for homes. However, with lowering home inventory, these prices have risen in certain desirable neighborhoods as bidding wars are taking place. Nassau County has reported a sales price increase of 7 percent while Westchester has had an increase of 3 percent.
The high-end luxury home inventory still remains soft on the asking price for homes about the $2 million cost range. Yet luxury homes ranging from $1 million to $2.5 million have also seen a surge in sales statewide.
Expected Rise in Interest Rates May Also Contribute to Sudden Buying Surge
Another factor that may have contributed to the sudden surge of suburb home purchases in New York City is the coming increase to interest rates. The Federal Reserve announced in March of 2017 that it would be raising its benchmark interest rate. This increase while cause mortgage rates to rise, as buyers who were on the fence about getting a home this year are scrambling to find one so they can lock in the present current rates. Currently, buyers can obtain a 30-year fixed mortgage at a little above 4 percent.
New York City Suburbs Attracting City Dwellers
Former renters moving from the city are seeing tons of perks with little disadvantages when buying in the suburbs. They can still commute to work and recreational hot spots in the downtown regions while coming home to the peace and tranquility found in the suburbs. With lower home sales prices and locking in low interest rates, buyers are tapping into their available savings and jumping feet first into the real estate market.
The only thing that would be better for buyers at this point in time is to find more home inventory hitting the market listings. With having fewer sellers placing a “For Sale” sign on their homes, it can lead to competitive bidding wars. With careful consideration of the real estate market, and keeping track of both home inventory and sales prices in certain suburb neighborhoods, buyers may still be able to find great deals and the perfect homes that fit their present needs.