New York Housing Market Outlook In 2023 & Beyond

As COVID-19 became a reality in the year 2020, the city's rural and suburban areas were thought to be buyer's markets.

"That changed and the markets were sold-out markets as of the spring of 2020." states Mihal Gartenberg, who is a licensed associate real estate broker at Coldwell Banker. "[With NYC], by the spring and summer of 2021 it was evident that the shift was through the air. Then, in the fall, we had selling like a lion."

Now, fast forward to 2023 and home buyers' demand remains. There are a myriad of reasons that keep the sales from increasing. The lack of inventory throughout the state has increased the competition for buyers and driving prices up. Additionally, rising mortgage rates have potential buyers stuck off the market.

Present market conditions for the housing market within New York State

New York is home to all kinds of things, from the world's largest financial capital to farmlands in rural areas, mountains, beaches and everything else in between.

"All of them contribute to the diverse nature of the housing market," adds Jeffrey Decatur, a RE/MAX Capital broker associate.

There is a huge demand for luxurious properties in Manhattan, which is considered to be the most costly housing market within the U.S., while the technology hubs in Rochester, Syracuse and Buffalo are attracting new buyers from around the globe. Investment properties and vacation homes are popular in families-friendly regions as well as regions dependent heavily on tourism.

While people continue moving into this part of the Empire State, more have gone home since the start of the epidemic. It saw the largest decline in population between the years 2020 and 2023. It lost 2.6 percent of its population total, as reported by the Moving Migration Report from North American Moving Services.

Population shuffles can affect the state's evolving property landscape.

New York Housing Trends and Stats

All across New York state, real property listings and sales have decreased compared to the same time last year; however, this could be a reflection of how robust the market was during 2021-2022. In addition, the inventory of homes is down because homeowners have waited to sell before markets change.

New York Home Sales and Listings is down in New York

All across the country, the number of property listings that were newly added decreased by 22.4 percent in the second quarter of 2023 compared to the previous year in the report of the New York State Association of Realtors (NYSAR). The association also said that the number of closed sales dropped 22.6 percent from last year.

A few areas of New York saw an even more dramatic drop in the amount of houses for auction. For instance, listings for homes in Orleans as well as Putnam counties fell by 37.3 percent and 34.5 percent, respectively, when compared with the previous year, as per the NYSAR report. Closed sales decreased for both regions during that same time.

Out of the 62 counties in the state, just two (Allegany and Essex) experienced an increase in the number of listings. Closed sales grew only within Essex, Hamilton, Livingston and Yates counties.

The Home Prices and inventory of Homes in New York Are Dropping

The median statewide sales value was $405,000 during the second quarter of 2023, which represents a 1.8 percent decrease from year to year. It's 2.7 percent less than the median national home cost of $416,100.

There aren't any price drops across all regions within New York, though. In many communities--especially in affordable markets--the low inventory is increasing competition among homebuyers and putting upward pressure on prices. The price of homes rose in more than 50% of New York counties during the second quarter of 2023.

Real estate broker Redfin states that these New York metro areas have the most rapid-growing prices for sales in the country in Q2 of the year:

• Livingston Manor. 60.8 Percent
• Aurora. 59.9%
• De Witt. 51.9%
• Saratoga Springs. 47.1%
• Malta. 38.7%

Many homeowners put off the idea of selling even though the cost has increased. In the last few years, homeowners bought homes or refinanced them for extremely low-interest rates. At present, they're waiting for the market circumstances to improve before they put their properties up for sale and further limit the already small housing inventory. The report of NYSAR found that New York had 3.2 months of housing inventory in July 2023. That's which is a 25.3 percent decrease over last year's.

More buyers are moving into the new home market in order to cope with the shortage of houses to sell. New-home construction and sales have risen in recent weeks and are pushing builders' confidence levels to levels that have not been ever in the past year.

New York Housing Market Predictions

The combination of higher rates of mortgage as well as higher house prices and a tight supply of homes is creating the most affordable homebuyers with financial challenges who live in New York.

As well as increasing prices for borrowing, the 2024 presidential election is another reason why the housing market could continue to slow for the next year.

"Presidential elections can result in immediate negative effects on the housing market," according to a global company that provides financial services, BTIG.

The majority of homebuyers are cautious as they are uncertain about forthcoming economic and policy shifts. "People do not like the anxiety when they're purchasing many loans," Gartenberg says.

But, this slowdown may be temporary. Prices for homes within New York have steadily increased in the last 18 years, increasing from a median value that was around $280,000 in 2005 and up to $405,000 in 2023. This is an increase of 44 percent. In the next 12 months, NYSAR expects home values to grow by 4%.

Do you want to buy or sell on the New York Housing Market?

Although home sales are declining across the country, "the market is still extremely active and well-maintained," Decatur says.

Yes, there are a lot of reasons to hold on. It is possible to stay clear of buying or selling your home in case you aren't able to afford the higher mortgage payments. Also, you might not have the ability to locate the kind of house you require and are content with your present living conditions. This is also not the best strategy if you're trying to manipulate the market so that you can make profits.

It could also be beneficial to get a new one if:

• You're moving to a different location.
• The new home payment

Selling your house could be beneficial If:

• The profits from your house sale will help you pay for the necessary down payment to reduce the interest rate for the next house you purchase
• There's not a lot of money. However, you are able to afford an interest rate that is higher and a house price
• The inventory is extremely limited within your area
• It is necessary to move

"The only thing you'll wish to think that you're not doing anything whatsoever," Decatur says. "When one has to buy or sell something, the water is clear. You can jump in."