Long Island homes sold at a record pace in the third quarter

If you wanted to buy a home this summer on Long Island, you had to act fast, as houses stayed on the market for the shortest amount of time since real estate brokerage Douglas Elliman and appraisal firm Miller Samuel began tracking the stat in 2002.

The Long Island real estate market continued to set new all-time highs in terms of both prices and speed of sales. The third quarter was the sixth in a row that home prices reached record highs, according to data being released Thursday by Douglas Elliman and Miller Samuel.

The median sale price was $585,000 for homes sold in Nassau and western Suffolk County in the third quarter, which represented a 17% jump from the same quarter in 2020. Even a few months made a difference. The median sales price was 5.4% higher from July to September than it was for sales recorded from April to June.

The median sales price in Nassau County was $670,000 during the third quarter, or 15.5% higher than during the same period in 2020. In Suffolk, excluding the Hamptons and the North Fork, the median price increased by 18.2% year-over-year to $514,000.

Homes appreciated in value in the pricey East End of Long Island as well. The median sales price in the Hamptons was $1.3 million in the third quarter, which was up 8.3% from $1.2 million last year. On the North Fork, the median sales price rose 13.9% to $800,000.

The low supply of houses for sale — the third-lowest recorded in nearly 20 years — and low mortgage rates that have stoked demand have conspired against homebuyers. The weekly average mortgage rate for a 30-year fixed-rate loan was 3.09% as of Oct. 21, the highest it has been since April, according to mortgage giant Freddie Mac.

"The people who got hurt in this the most are first-time homebuyers," said Ann Conroy, Long Island CEO for Douglas Elliman. "They have great low interest rates and want to buy a house, and with a lack of inventory and higher pricing a lot of them have had to stay on the sidelines.

Homes sold in just 45 days in the third quarter from the day a home was first listed to when a buyer signed a purchase contract. Last year, that figure was 76 days. The seasonal average over the past decade for days on the market is nearly twice as long at 82 days.

"Forty-five days is incredibly fast," said Jonathan Miller, CEO of Miller Samuel, a property appraisal firm based in Manhattan. The highest average number of days homes remained on the market was 137 in the first quarter of 2012.

The pace of the market has left buyers without room to negotiate. The third quarter was the first time in two decades that the average home sold on Long Island had no discount on the asking price. In fact, for single-family homes, the average home sold for 0.1% above the seller’s list price.

"If you find a house that ticks off all your needs, be ready to make an offer at asking price or above asking price," Conroy said.

More than half of homes sold for above the asking price, 55.8% to be exact, which shows that buyers are frequently competing against other prospective homeowners.

The total number of deals closed in the third quarter increased by 29%, to 9,228, compared with the same period in 2020, when pandemic restrictions were easing.

Miller predicted fewer home sales in the fourth quarter based on seasonal trends that are reemerging following distortion caused by the pandemic. But Long Island’s real estate market is unlikely to fade anytime soon.

"Typically, when a market loses momentum or steam, prices continue to rise and sales activity falls," Miller said. "That isn’t happening yet."

Competitively priced homes that go on the market on a Thursday often receive multiple offers over the weekend, with sellers making a decision by Monday, said Amy Girimonti, a real estate broker with Prime Properties Long Island in Huntington. The speed of the process is forcing sellers to ensure they have their next home lined up — sometimes before they even list their property.

"You have to be competitive in your approach and ready to buy or sell," Girimonti said. "There’s no shopping at this point."

By Jonathan LaMantia

jonathan.lamantia@newsday.com@jonlamantia

Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.