In Long Island's soaring real estate market, would-be buyers may be overlooking communities where home prices have stayed more down-to-earth.
The Island’s most luxurious coastal communities posted eye-popping annual home price increases this spring. The Hamptons community of Wainscott, for instance, saw the median price triple to almost $2.8 million in the second quarter compared with the same period last year; in the village of Roslyn Harbor on the Gold Coast of Nassau County, the median price jumped 158% year-over-year to nearly $2.2 million; and in the North Fork hamlet of Orient, the median price more than doubled annually to $2.25 million, the Manhattan-based appraisal company Miller Samuel and the brokerage Douglas Elliman said in their most recent report.
Across the rest of the Island, outside of the East End, prices jumped 18% from a year earlier, to a median of $555,000, the report shows.
But there are dozens of communities where median prices increased by 10% or less, or even dropped, over the same period, an analysis of community-level home price data compiled for Newsday by Miller Samuel and Douglas Elliman shows. Many have median prices between $300,000 and $700,000, a range made attainable for more buyers by historically low mortgage rates.
Among them are a number of communities – including East Patchogue, Farmingdale, Glen Cove, Huntington Station and Rockville Centre – whose proximity to walkable downtowns and commuter train stations have attracted homebuyers for years.
"The luxury markets across the region have gotten the lion's share of attention," especially since they had been lagging before the pandemic, said Jonathan Miller, president and CEO of Miller Samuel. But, he said, "their comeback has overshadowed the more consistent performance of mid-tier housing markets that have fundamental advantages, like close proximity to services and transportation."
The disparate price trends reflect buyers’ shifting tastes before and during the pandemic, and they offer hints about what’s to come over the next year or so, real estate agents said. Easy access to city-bound trains became less of a draw during the COVID-19 crisis, brokers said, as many affluent buyers fleeing the city sought out more far-flung properties with sprawling backyards and plenty of room for remote work and school, and many workers found they could do their jobs remotely.
Long Island Rail Road ridership has plummeted during the pandemic. The rail system had 1.6 million riders last month, up from 1 million a year earlier but less than half the 3.9 million riders in August 2019, LIRR reports show.
"In the heart of this thing, nobody was going to work, we were all working from home," said Edmund Costigan, a real estate agent with Hardscrabble Realty in Farmingdale. The commute, he said, "wasn't considered to be a major concern."
Many buyers leaving New York City and buying homes on Long Island during the pandemic "aren't looking for the downtown areas…they don’t want to go from one downtown to another," said Michael Grannum, a real estate agent with Exit Realty Premier in Massapequa.
But with vaccination rates slowly rising, most children back in school and many New York City-based employers making plans for a gradual return to offices, either full-time or on a hybrid schedule, some real estate brokers say the commute is likely to regain its place as a priority in buyers' minds.
Costigan said that for perhaps the first time since the pandemic began, a buyer recently asked to see homes no further east than Farmingdale, so he could save time on the westbound commute. Even for those who are still not commuting, Costigan said, "I would think that eventually it has to be on your radar screen."
Plus, Farmingdale’s Main Street is thriving, he said: "Downtown is happening almost every night.... People are really interested in definitely getting out and getting their social life back together."
With Long Island’s "price frenzy" easing, Miller predicted, suburban downtowns "will still continue to hold the advantages of their proximity to services and transportation, with the added benefit of the flexibility that remote work allows as well."
Here is a look at five suburban communities close to downtowns and train stations where home prices have stayed within 10% of their year-ago levels.
Median price: $405,500
Year-over-year change: Up 4.4%
In the hamlet, "you can go from the $300,000 price range to the $2 million price range," said Lina Lopes, an associate broker with Douglas Elliman in Farmingville who lives in East Patchogue. "Every single buyer can find a house there, from a weekend vacation home down by the water to a first-time homebuyer."
The community is quiet, but it has easy access to the neighboring villages of Patchogue and Bellport, which offer ferries to Fire Island along with Long Island Rail Road stations, she said. Lopes said she has seen prices rise during the pandemic, though first-time buyers can still find homes for as low as $300,000. And property taxes tend to be affordable, with $4,000 annual tax bills for some homes, she said.
Before the pandemic, demand was not strong for homes priced above about $500,000, but that changed once COVID hit, she said. "When a lot of people couldn't find homes out in the Hamptons by the water, they started going farther west," Lopes said.
At the height of the pandemic, transit became a lower priority for some buyers, she said. But "in the last six months, eight months, people are starting to talk again about the commute and being closer to the train."
Median price: $530,000
Year-over-year change: Up 10%
The bidding wars that broke out earlier in the pandemic drove up prices, and there were fewer than 50 homes listed for sale in the village on a recent day, roughly half the usual level, said Costigan, of Hardscrabble Realty. In addition to the village’s train station and nightlife, buyers are drawn by amenities including the school system’s sports fields and aquatics center, he said.
"I worked with a buyer, a young couple, and they got outbid 20 times," he said. "They just got discouraged…. I told them at one point, at the beginning of the pandemic, I said, ‘You want to see that house? You're the 40th appointment.’ And I think that was the straw that broke the camel's back. They said, ‘Forget it, we're just going to continue to rent.’"
But now, he said, values seem to have leveled off.
"I think they’re kind of holding their own right here for now," he said of home prices. "I don't think they’re continuing to rise."
Median price: $661,750
Year-over-year change: Up 9.8%
The city is in the midst of a "massive revitalization," said John Russo, an associate broker with Richard B. Arnold Real Estate in Sea Cliff. Russo said that’s due in large part to RXR Realty’s 56-acre, 1,100-unit Garvies Point condominium and rental development rising on the waterfront and its 146-apartment Village Square mixed-use development downtown.
The new construction, he said, "is definitely going to bring more people in."
The city has built a ferry terminal that was expected to provide service to Manhattan, though the service has been indefinitely delayed due to the pandemic and "the uncertain and fluctuating numbers of commuters into Manhattan," a city spokeswoman told Newsday in a recent email. Glen Cove has a Long Island Rail Road station that takes commuters into Manhattan in just over an hour, with a transfer at Jamaica.
Russo said that in comparison with the price spikes seen in some other Long Island communities, Glen Cove’s nearly 10% annual increase "is more of a realistic trend versus something that's going to spike and then you know, potentially come back down. This is a nice steady trend, and it's healthy."
Median price: $475,000
Year-over-year change: Up 6.7%
The market "is still super-competitive," with multiple offers on many homes, said Jeffrey Stineback, a real estate agent with Compass in Huntington. "It was even competitive before the pandemic…. I like to tell this to clients a lot, that the pandemic didn't create the market we're in now, it really just exacerbated it."
The hamlet’s capes, split-levels and ranches, many with annual property taxes under $10,000, are a big draw for first-time buyers, he said. Its roughly hour-long train ride into Penn Station still attracts many commuters – and lately, remote workers who know they’ll eventually have to commute again, Stineback said. With rentals scarce and expensive, it’s possible to own a house for the same monthly cost as renting one, he said.
The nearby village of Huntington also is a draw for many residents, especially with restaurants offering outdoor seating and the Paramount hosting outdoor concerts, said Jessica Bernstein, 39, who is selling her three-bedroom Huntington Station house and shopping for a one-bedroom home in the area.
"We have, I think, one of the best villages around on Long Island," said Bernstein, who worked as a COVID-19 contact tracer on Long Island earlier this year and is searching for a job in community outreach. "It's got so many great restaurants and things to do, and great parks. There's just a lot you can do around here."
Median price: $662,000
CYear-over-year change: Down 5.4%
The village’s direct, 38-minute train rides to Manhattan and Brooklyn have always made it "one of the most desirable locations" on the Island, said Amy Williamson, a real estate agent with Daniel Gale Sotheby’s International Realty in Rockville Centre. Even with so many people working from home, she said, "people still want to be in close proximity to Manhattan."
In the immediate aftermath of the COVID-19 real estate shutdown that ended in June 2020, competition among buyers was so fierce, "it was mayhem. It was crazy. You could put your house on the market and sell it in a day."
With demand so strong, she said, "I do think a lot of sellers, to some extent, were trying at some numbers, thinking, ‘hey, what do we have to lose? You know, let's just see what we get.’"
More recently, though, Williamson said, "I'm starting to see price reductions…and that was the first time in a long time that people were starting to reduce their prices."
Despite the shift to a less frenzied market, Williamson said, low mortgage rates – 2.88% on average, mortgage giant Freddie Mac reported Thursday – are still drawing buyers into the market. Homes listed in the $600,000s and $700,000s, she said, still "fly off the shelf…because there are so many first-time homebuyers who are taking advantage of low interest rates."