Long Island home prices kept rising as the spring selling season got underway last month, but the pace of sales slowed and inventory is on the rise.
In Suffolk County, homes sold for a median price of $372,875 in March, up 5.9 percent from a year earlier, the Multiple Listing Service of Long Island reported Thursday. Nassau County’s median home price increased by 3.4 percent annually, to $517,000.
The number of closed home sales fell year-over-year by 5.8 percent in Suffolk and 8.8 percent in Nassau, the listing service reported. However, in a sign that the market could get stronger in the coming months, the number of contract signings jumped by more than 10 percent in Suffolk and ticked up by 1.4 percent in Nassau, compared with the previous March.
Demand is strong for homes in the $400,000 to $600,000 price range, said Russ Bonanno, a real estate agent with Bon Anno Real Estate in Massapequa who handles home sales from western Nassau through Dix Hills and Commack in Suffolk.
In that price range, he said, “it’s a very competitive environment out there for buyers. There’s a lot of very serious and very qualified buyers out there.” A home listed for $549,000 in North Bellmore recently went under contract four days after it was listed, with 17 competing offers, he said.
A strong economy, low unemployment and affordable mortgage rates are driving buyers’ enthusiasm, Bonanno said. The average mortgage rate was 4.12 percent this week, 0.3 percentage points lower than a year ago, mortgage giant Freddie Mac reported Thursday.
The market is less competitive for more expensive homes, Bonanno said: “As you go up in price, the buyer pool does shrink a bit.”
Some sellers, he said, “are overambitious, and those are the homes that are going to be sitting for a while.”
Indeed, listing prices and inventory are rising in both counties.
Asking prices hit a median $519,000 in Suffolk, 8 percent higher than the previous March, and $689,000 in Nassau, up 6 percent from a year earlier, listing service figures show.
The number of homes listed for sale grew year-over-year by 22 percent in Nassau and 7.2 percent in Suffolk, according to listing service figures. At the current pace of sales, it would take a little more than six months to sell all the homes listed for sale in Nassau and Suffolk. Brokers say a balanced market has a six- to eight-month supply of homes.
In both counties, March was the second month in a row when the supply of homes exceeded six months, giving buyers more options. By contrast, sellers have had the advantage — with a less-than-six-month supply of homes, and therefore more negotiating power — in 27 of the past 36 months in Suffolk and 30 of the past 36 months in Nassau.
By contrast, from spring 2013 through spring 2016, buyers often had the advantage, with about a seven- to 12-month supply of homes in Suffolk and about a five- to 10-month supply in Nassau.