The third quarter of 2008 has just ended and its time to take stock of the Westchester housing market. Real estate is a local business and this was never more true than in Westchester County. In Westchester, you can move from high-rise cityscape to rolling hills with single family homes on half acre lots in less than two miles. It should not be surprising that market trends vary between communities.
White Plains, NY a city of close to 60,000 residents and a commuter population of over 250,000 has witnessed explosive growth over the past ten years and has proved to be remarkably resilient in spite of the housing recession that currently grips the country. Nevertheless, there has been some weakness in this market and in some sectors there have been minor corrections.
The first graph shows the average third quarter pricing for the coop, condo and single family markets in relation to the third quarter of 2007. The average cost of a coop has gone down 7.9% over the same period last year from $246,000 in 2007 to $228,000 in 2008. Prior to this report, coop prices had shown tremendous resilience with prices posting gains or staying level. Pockets of a seller’s market still exist in coops, particularly at the higher end above $300,000.
The second chart shows the current inventory of active listings versus the number of units sold during the last quarter and indicates that it will take about five months to absorb the current inventory of coops. This indicates a market that is fairly neutral between buyers and sellers. The balance of power appears to be shifting to the buyer should the trend towards larger inventories increase.
Condos posted the biggest gains – up 20.3% over last year. It should be noted that I adjusted some of these numbers to reflect the fact that the Ritz Carlton of White Plains, a very high-end condominium complex had yet to have a closing at this time last year. Since it represents a new price point for the city, it skewed relative values upwards in a way that did not reflect changes in the market. The adjusted average of $481,000 is a better reflection of condo sales in general and is more relevant to buyers and sellers of units under $800,000. The actual average which reflects condos in the $2 million plus range is $514,000.
There is roughly a 6.7 month supply of active listings on the condo market making this market similar to coops in that th balance of power is shifting towards the buyer and away from the seller – higher prices notwithstanding.
Single family home prices have been weakening since the third quarter of last year. Right now they appear to be stabilizing although with an average price of $756,000 they are down 3.4% over the same period last year. Nevertheless, this indicates a leveling off because average prices are unchanged from the previous quarter. Overall, prices for single family homes have dropped about 7% since the spring of 2007.
The 3.4 month supply of single family homes is a good reflection of a market that has undergone a dip and is now firming up. Although prices remain soft, a 3.4 month supply of inventory tilts the balance of power more in the seller’s direction.
Although the White Plains, NY market has been highly resistant to some of the downward trends gripping the country, the low sales volume indicates a market that is correcting – particularly with respect to condos and coops which have been the strong points of the market up until now.
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