Demand Strongly Outpaces Inventory In New York

In August 2020, there were 54,424 homes for sale compared to 43,106 in August 2021, according to the New York State Association of Realtors. This marks a 20.8% decline, with months of inventory plummeting 36% statewide from 5 months last year to 3.2 months in August 2021. 

Meanwhile, the number of homes sold increased from 12 consecutive months in NY year-over-year. According to NYSAR, closed sales increased 16.9% from 12,663 units in August 2020 to 14.808 in August 2021. Closed sales are up by 36.3% for the year. Additionally, the median sales price increased by 29.9% to $395,000 compared to $204,000 last year. 

“Pending sales and new listing were both down for August,” according to the NYSAR report. “Pending sales fell 8.4% from 16,766 in August 2020 to 15,357 in August 2021. New listings fell 15.9% in August as well. There were 18,023 listings last month compared to 21,442 in August 2020.”

Mortgage interest rates have been the only signs of relief for homebuyers. According to Freddie Mac, the monthly average on a 30-year fixed-rate mortgage in August dipped to 2.84% – the lowest rate since February.

A report from First American Financial Association revealed that home-buying power is being fueled by low mortgage rates. Economic uncertainty has forced rates to remain below the 3% mark for an extended period of time during the COVID-19 pandemic. This may explain why the number of homes sold is seeing a sharp increase in NY.