Q2 2024 Real Estate Market Report
The housing market in New York City’s northern and western suburbs in the second quarter of 2024 started to show the first signs of transitioning from the seller’s market that drove prices to historic highs over the past four years. Sales were still down, and prices were again way up, but we are starting to see the kind of increases in inventory and listings that will stabilize the market. Here are three takeaways from the housing market in the second quarter:
1.SALES ARE STILL FALLING.
Sales were down again, falling in every region and almost every county. We’ve now seen regional sales go down for over nine straight quarters, going back to the beginning of 2022 when the post-COVID market started to run out of fuel.
Sales were down 9% in Westchester and the Hudson Valley, 5% in Northern New Jersey, 4% in Fairfield County, and 7% in the Bronx. That trend started slowing in the first quarter, though, and is continuing to fade – as you can see, the yearlong sales fell a lot more than the quarterly decline.
That said, we see no reason for optimism that sales will pick up in the summer. Pending sales, which are a leading indicator for closings over the next quarter, were also down. Again, though, the decline seems to be moderating after a much more severe trend during the past year. We believe we will see sales flatten out by the end of the year.
2. PRICES CONTINUE TO HIT HISTORIC HEIGHTS.
Even with sales down, prices continued to rise, again hitting all-time highs throughout the region. For the quarter, prices were up in every virtually every county in the region, and every region in the metro area, rising dramatically in both Westchester/Hudson Valley and Northern New Jersey. For the year, prices were up 10% in Westchester and the Hudson Valley, 9% in Northern New Jersey, 8% in Fairfield County, and were up just a tick.
These kinds of price increases in the face of two years of declining sales is extraordinary. Usually, when sales go down, prices go down, because declining sales is often a signal of reduced buyer demand. But even with interest rates hovering around 7%, almost double where they were just two years ago, buyer demand still seems to be strong enough to continue to drive price increases. This is partly because of the overall strength of the economy, and partly because supply is so low right now that even a moderate level of buyer demand is enough to drive significant price appreciation.
3. INVENTORY IS STARTING TO CREEP UP.
That tight inventory market, though, might be loosening up. We noted last quarter that we were seeing some “green shoots” of inventory starting to come back. That trend continued in the second quarter, with listings up from last year and inventory
starting to move significantly closer to a balanced market. For the past few years, we’ve been dealing with ridiculously low inventory, in many cases with just 2.0 months of homes available for sale. Now, for the first time in years, we’re starting
to see inventory go up. The months of inventory were up 43% in Westchester and the Hudson Valley, 15% in Northern New Jersey, 26% in Fairfield, and 19% in the Bronx. We’re now seeing inventory at a 3-month level or higher. Six months of inventory signals a balanced market, and we are still well below that level, but the market is definitely loosening up. Part of the reason for higher inventory was the long-awaited increase in new listings, which went up for the first time in years. You can see the shift in the market just by looking at the quarterly change in new listings versus the change over the past year. For example, new listings in Northern New Jersey were up 9% for the quarter, finishing a year when they were down 6%,
which means that the second quarter reversed three quarters of pretty sharp declines. We still need a lot more listings to balance out the market, but the trend is starting to emerge.
