As of the end of 2024, the Westchester County real estate market has been marked by several notable trends, influenced by factors like interest rates, economic conditions, and continued demand for suburban living. Here’s an overview of how the market wrapped up:
1. Price Trends
• Stable or Modest Growth: Home prices in Westchester County saw modest increases in 2024 compared to the previous year, although the pace of growth slowed significantly. Certain areas, particularly those in high-demand towns such as Scarsdale, Rye, and Bronxville, continued to see competitive pricing, with homes in the luxury segment (above $2 million) still fetching premium prices.
• Price Convergence: There was a trend toward stabilization in mid-tier price points, as the market adjusted to higher mortgage rates. However, some regions saw slight price declines due to slower buyer activity, particularly in more suburban areas further from NYC.
2. Sales Volume
• Lower Transaction Volume: Overall, sales volume continued to be lower than in pre-pandemic years. Higher mortgage rates, which averaged in the 6-7% range, kept many buyers on the sidelines. Homeowners who locked in lower rates in prior years were hesitant to sell, contributing to inventory shortages and reducing overall market activity.
• Luxury Market Resilience: The luxury real estate market remained resilient, driven by buyers seeking larger homes with more space for remote work and a preference for more suburban lifestyles. This segment was less affected by the rate hikes, with continued strong demand for properties priced $2 million and above.
3. Inventory and Supply
• Tight Inventory: The inventory of available homes remained tight in 2024. While more listings came to market compared to 2023, the supply still lagged behind demand in many desirable towns. This led to multiple offers on well-priced homes, especially in highly sought-after school districts and commuter-friendly locations.
• New Construction: The new construction market showed some signs of growth, but rising construction costs and labor shortages continued to pose challenges for builders. Still, modern homes with energy-efficient features and flexible layouts were in demand.
4. Rental Market
• Rising Rents: The rental market continued to see upward pressure on prices, especially in high-demand areas near transportation hubs. Renters sought larger apartments or single-family homes as remote or hybrid work arrangements persisted. High demand for rental properties was particularly evident in areas like White Plains, Yonkers, and Hastings-on-Hudson.
• Vacancy Rates: Vacancy rates remained low, making it a competitive market for renters, with limited availability in both suburban apartment complexes and single-family homes.
5. Economic Factors
• Impact of High Mortgage Rates: The Federal Reserve’s stance on interest rates remained a dominant factor in 2024. Mortgage rates, though somewhat stable, remained higher than many had hoped, limiting some buyers’ purchasing power. This had a cooling effect, especially for first-time homebuyers and those looking at mid-range properties.
• Affordability Challenges: As prices continued to rise and mortgage rates remained elevated, affordability became an issue for many potential buyers. This was particularly noticeable in the lower- and middle-price segments, where first-time buyers were squeezed out of the market.
6. Outlook for 2025
• The outlook for the Westchester County market heading into 2025 is cautiously optimistic. While mortgage rates may remain high for the early part of the year, there is anticipation that the Fed could start reducing rates in the latter half of 2025, which may boost buyer activity. However, the market is expected to remain competitive, with a continued preference for larger suburban homes and more desirable towns close to NYC.
In summary, Westchester County’s real estate market in 2024 finished on a relatively stable note with strong performance in the luxury sector and continued affordability challenges in certain areas. Buyers and sellers remained cautious, and market activity was influenced by factors like high mortgage rates, limited inventory, and the ongoing desire for suburban living.
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