As Long Island prepares for the traditional second wave of real estate that happens in late summer and early fall, there’s good news for prospective home buyers this month: inventory is finally increasing.
What’s behind this change and, perhaps most importantly, will it last? Here’s what we think is driving the shift in Long Island real estate.
Sellers Have Been Tempted Off the Sidelines by High Prices
After months of rising home prices, including record-breaking sales all over Long Island, some sellers have been tempted to see what they can get for their own property. This temptation to list and cash out while the market is hot contributed to an 11% increase in the number of new homes that hit the US market in June. While inventory is still down more than 40% from a year ago, it’s encouraging to see a significant month-over-month increase. July market data is not finalized, but the number of new homes for sale on Long Island has definitely increased in recent weeks.
Want to see the latest market data for your community or zip code? Reach out to us!
The Market Has Started to Top Out and Come Back to Reality
There’s a ceiling to every market and we may have finally reached it on Long Island. Homes are only worth what a buyer is willing to pay for them. If prices rise too high and too fast, buyers won’t buy. It’s as simple as that. If buyers won’t buy, that means sellers will need to consider price reductions. Overall days on market will increase as result.
Despite the change, sellers on Long Island are still getting great prices for their homes. Curious what yours is worth? Click here to request a free estimate.
The Recovering Economy Has Encouraged Some People to Move
The post-pandemic economic recovery has been stronger than expected. More than 850,000 jobs were added in the US in June. Unemployment rates fell to pre-pandemic levels. The Federal Reserve also announced they will raise interest rates twice in 2023, a move that reflects their confidence in the forward momentum of the economy.
One surprise for the job market in recent months has been the number of people who are quitting their jobs or changing careers. Nicknamed “The Great Resignation,” many people have decided to look for other opportunities that either allow them to telecommute or involve less of a drive to the office. Others, encouraged by the strength in the economy, are seeking higher pay and more career opportunities. With millions on the move, people are doing what they always do when they’re navigating a big life change: putting their homes up for sale.
Bottomline: While There Are Still Plenty of Buyers Out Looking, It’s Not Such a Frenzy Anymore
During the first half of 2021, the Long Island housing market was a whirlwind of eager buyers and determined agents trying to get homes for their clients. Bidding wars were common, and buyers were willing to pay well over asking for the home of their dreams. Some people waived their inspection contingency and even paid the seller’s closing costs alongside their own. That type of market simply can’t last forever. Now, we’re seeing that shift.
Whether people have grown weary of fighting to get a home or have put their plans on hold while they travel to see loved ones this summer, the market feels just a bit more relaxed. There are still way more interested buyers than there are homes for sale and while many properties do receive multiple offers over asking, buyers are acting a bit more rationally. They’re willing to walk away if the demands are too great or the price is too high, putting pressure on unrealistic sellers.
Where there’s change, there’s always opportunity. After months of such a strong seller’s market, there’s a bit of hope for prospective home buyers. If you’re been thinking of selling or need to sell because your home no longer fits your needs, it’s still a great time to list. Home prices are up across Long Island and with the right agents to market your home, you’re sure to get a great offer. Check out some of our recent featured sales here and if you’re ready to make your move, give us a call today!