Long Island home prices jumped by their widest margins in years last month, as the number of homes for sale dropped.
In Nassau County, homes sold for a median price of $505,000 in February, up 12.5 percent from a year earlier, the Multiple Listing Service of Long Island reported Friday. Suffolk County home prices increased, year over year, by 9.4 percent, to $360,000.
Those were the biggest increases since 2006 in Nassau and since 2015 in Suffolk.
Buyers had a scarce supply of homes to choose from, as the number of listings fell by 14 percent in Suffolk and 2 percent in Nassau, compared with the previous February.
Competition is especially fierce among first-time buyers seeking homes in the $300,000 to $500,000 range, brokers said.
One recent open house for a home in Patchogue listed for $300,000 attracted 35 potential buyers, nine of whom made offers, including some over the asking price, said Debbie Carpluk, a real estate agent with Keller Williams Elite in Massapequa Park and Islip.
Sellers “are getting their numbers,” Carpluk said. But, she said, “so many buyers are getting discouraged with the bidding wars.”
Closed sales dropped by 7.8 percent in Suffolk and 10 percent in Nassau from a year earlier, the listing service reported. At the current selling pace, it would take about six months to sell all listed homes in both counties, indicating the market is roughly balanced between buyers and sellers.
The number of new contract signings increased from a year earlier by about 4 percent in both counties.
Rising interest rates are prompting buyers to get “off the fence,” said Joseph Ricco, an associate broker with Century 21 American Homes in Westbury.
The average rate for a 30-year mortgage was 4.44 percent this week, up 0.14 percentage points from a year earlier, mortgage giant Freddie Mac reported.
One real estate investor dragged out price negotiations until Ricco pointed out that while he might save $5,000 on the purchase, he would lose $10,000 if interest rates kept climbing. “He finally said ‘you’re right’ and gave them full price,” Ricco recalled.
Despite the increases, Suffolk’s real estate market has not gotten back to its peak median price of $420,000, reached in June 2007. In Nassau, it took until last June for the median price to climb back above its 2007 high point of $502,500.