Market Conditions Remain Healthy and Indicators Point to More of the Same for Remainder of the Year
Sales of luxury homes north of NYC in Q2 continued to post double- and triple-digit gains compared to Q2 2020, according to the Houlihan Lawrence Luxury Market Report released today.
Luxury sales in Westchester ($2 million and higher) rose 174% while luxury sales in the Putnam-Dutchess market ($1 million and higher) rose 172.7%. The Greenwich luxury market ($3 million and higher) increased 138% while the Darien and New Canaan luxury markets for $2 million and higher soared 227.8% and 277.8% respectively. Meanwhile, median sale prices in Westchester and Putnam-Dutchess markets rose 10.6% and 14.5%, respectively. The Greenwich market saw median sale price up 18.1% while the median sale price in Darien fell 0.7% and rose 0.5% in New Canaan.
During the second quarter of 2020, the real estate markets in New York and Connecticut were greatly impacted as a result of the COVID-19 pandemic. Consequently Q2-2021 vs. Q2-2020 percent gains may render a skewed analysis of the luxury markets. A more meaningful comparison is the number of closed sales in the first half of 2021 (post-Covid) vs. first half of 2019 (pre-Covid). In every area north of NYC, the number of luxury sales is higher in the first half of 2021 vs. the same period in 2019, indicating the Covid effect is still impacting the luxury markets.
According to the report, pending sales, which is a forward-looking indicator, provide the most relevant data points to best analyze luxury markets in the northern suburbs. The absorption rate of homes for sale north of NYC is strong. Buyers are motivated and decisive due to limited supply, and competitive bidding is not uncommon. Approximately 30% of luxury sales closed over asking price in Westchester County since the beginning of 2021.
“Some luxury homes are still sitting on the market. Sellers who want to capture the momentum are reducing their price to be more attractive to price-sensitive buyers. The duality of the market – competitive bidding alongside price-sensitive buyers – appears contradictory. However, price is always a primary consideration in real estate decision making. Value has to be displayed even when supply is tight, and often, multiple offers signal to a potential buyer that strong demand now may be a precursor to future strong demand as well,” said Anthony P. Cutugno, Sr. Vice President, Director of Private Brokerage.
Cutugno said increasing vaccination rates and eased restrictions in NYC have led to euphoric feelings of life returning to normal. “The energy has returned and NYC is back on the radar for buyers, an about-face from last year when NYC dwellers fled the city for less densely populated areas. Simultaneously, Wall Street is summoning its employees back to the office, voicing the competitive advantage of interacting and collaborating under one roof. It will be interesting to see how this affects the luxury housing market north of NYC and those buyers who purchased with the intent of commuting less and continuing to work from home more,” he said.
Cutugno concluded, “Market conditions are healthy and all indicators point to more of the same for the remainder of the year. However, we are reminded that the speed with which a collapse occurred in early 2020, and the amazing recovery that followed, are unlike anything in recent history.”
Q2 MARKETS AT A GLANCE
Westchester County Luxury Home Sales /$2M and Higher
Homes Sold: Up 174%
Median Sale Price: Up 10.6%
Highest Sale Price: $8,500,000 Scarsdale
Putnam and Dutchess County Luxury Home Sales /$1M and Higher
Homes Sold: Up 172.7%
Median Sale Price: Up 14.5%
Highest Sale Price Putnam: $3,600,000 Garrison
Highest Sale Price Dutchess: $2,190,000 Rhinebeck
Greenwich Luxury Home Sales /$3M and Higher
Homes Sold: Up 138%
Median Sale Price: Up 18.1%
Highest Sale Price: $27,750,000
Darien Luxury Home Sales /$2M and Higher
Homes Sold: Up 227.8%
Median Sale Price: Down 0.7%
Highest Sale Price: $7,450,000
New Canaan Luxury Home Sales /$2M and Higher
Homes Sold: Up 277.8%
Median Sale Price: Up 0.5%
Highest Sale Price: $7,850,000