Numbers are important in real estate, which is why I put so much time into them on my blog. Unfortunately, numbers without context don’t work so well, so once my readers see the numbers, they don’t want to read the text. But, if you are thinking of buying or selling, the numbers and their context very, very important. So, forgive the geekiness and enjoy the solid facts. You might want to pour a cup of coffee before going much further. I wouldn’t want you to fall asleep while reading my page-turner of a market report.
2016 was a seller’s market for Westchester real estate (particularly lower Westchester) and White Plains was not an exception to the rule. Inventories were tight which accounted for the slight loss of volume. Still, buyer demand kept the market moving.
Over the past couple of years, single family homes sales, though strong has actually been held back by low inventory levels. 2016 was no exception to this trend. Prices continued their upward trajectory rising nearly 7.5% over the previous year. But actual sales volume decreased 8%, much of which can be attributed to a lack of inventory. For those who are thinking about selling, this may be a good time to do so. Even with sales volume down, potential buyers were frustrated by low inventories. Buyers have to be realistic. With inventories low and prices rising, it is definitely a seller’s market.
Median condominium prices were down ever so slight over 2015. But the drop from $412.5k to $405k (less than 4%) is not really significant. Prices were still 5% above 2014 levels, so this might be more of a temporary blip. Time will tell, but demand for condos seems to remain high.
Sales volume was down over 2015 but remained well over 2014 levels by nearly 17%. This figure is more than likely to be due to the low inventories experienced in White Plains.
Once again, this is a seller’s market and in my opinion, it looks like it will remain so for a while. The main reason for my conclusion is that although there is construction aplenty in White Plains and surrounding locations, there is precious little being built for purchase. Over 90% of the inventory going up right now is in the form of luxury rentals. Since housing prices are the result of supply and demand and nothing is being built to meet the increasing demand, there isn’t much out there to cause prices to go down.
What holds for condos, also holds for cooperatives. First time buyers and downsizers alike are increasing demand for this inventory which is very limited. Cooperative conversions are something that simply isn’t happening anymore. In this case, there is no new inventory coming on the market to meet an increasing demand.
Median prices have been increasing in an almost linear manner for several years and it was the same for 2016. Price increases of about 3% were observed for 2016. Sales volume was also up about 3.5%
Buyers need to understand that this is a seller’s market, but at the same time, they are buying into a market where a lack of new inventory will probably serve them well over time. This is a case where it doesn’t pay to wait. Many buyers are disappointed that these units are not always up-to-date and hold out for something move-in ready. But waiting when prices and interest rates are increasing isn’t going to help. As I said to a couple of co-op buyers that I had in my car last year, this isn’t going to get any easier. Meanwhile, the longer you wait, your dollar buys less and less.
Downsizer’s are facing unique problems purchasing their next home. The gulf between SF home prices and condo prices is not looking to get any better in the foreseeable future. It could actually worsen. It can be a bitter pill for empty nesters to see that their downsizing move may be lateral. Such a move will reduce the cost of living, create a more convenient lifestyle, but leave sellers with little profits to bank.
None of this is going to reverse itself over the next few years. So, if you need or want to move, delaying will not help you and could make things even harder. And remember, once you are a condo or co-op owner, you too will be on the right side of this equation and can benefit from it.
So, I hope I didn’t bore everyone to tears with these numbers. Everyone still awake? Better informed? Just hope this was helpful!
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