NEW YORK - The Long Island housing market is experiencing some slowdown this year, with prices rising but fewer transactions. In addition, the housing shortage limits the number of homes for sale. In July, closed sales fell by 23% compared to July 2013. Median prices remained at record highs.
Recent sales on Long Island have been hindered by a lack of listings and rising mortgage rates. Although home prices remain at record highs, the inventory of available homes is lagging. However, many brokers believe that change is on the horizon. While we cannot predict the future, there are some things you can do to prepare for a future market.
While the housing market has recently seen a few ups and downs, it's likely to bounce back hotter in 2023. This is great news for investors looking to flip homes. While the market might not be as hot as in 2021, it will remain affordable for most buyers.
The current supply and demand imbalance will continue to affect home prices. In August 2021, the median home price in Suffolk County reached $535,000, a 17.6% increase from the same month last year. It would take about two months to sell the home at that price - twice as fast as in a balanced market.
The housing supply in Suffolk County has increased by 4.3% in the last year, but this level of supply is enough to support a seller's market. However, as more properties come on the market, the buyer's market will become less fierce than in 2021. As a result, more properties will be available, reducing prices and changing the buyer-seller balance.
The overall cost of living on Long Island is increasing due to aggressive inflation. With rising gasoline prices, rising health care costs, and grocery costs, the cost of a home is rising. This has caused a demand for single-family homes. Despite this, the median income in Long Island is $91,000.
While the prices are still high, the shortage of housing inventory is the primary contributing factor. The high demand and lack of inventory have created a buyer's market. The COVID-19 pandemic has contributed to this, sending a housing frenzy across the nation. The housing frenzy has particularly outsized effects in the West. In the West, the booming economy meant that homes were cheaper and larger.
Uncertainty in politics can impact real estate prices. This uncertainty can affect all sectors of the economy, including the housing market. Regardless of who wins the election, the new president's policies will likely impact the housing market and make it less favorable for home buyers. This uncertainty could cause some buyers to delay their purchases.
Rising inflation could increase the cost of housing. This could push the monthly payment over the affordability threshold. As a result, the market could experience a recession in 2023. In addition, the increasing cost of housing will increase mortgage rates.
