Long Island home prices swell to new records in August

Competition for Long Island homes showed no signs of cooling off in August, as the median sale prices in both Nassau and Suffolk counties hit record highs last month.

The median single-family home in Nassau sold for $835,000 in August, or 11.3% more than the same figure a year ago, according to data released Monday by OneKey MLS.

In Suffolk, the median price rose to $680,000 last month, which was 8.8% higher than in August 2023. The data covers deals that closed in August.

Rising prices and homes staying on the market for shorter periods suggest there are still plenty of eager buyers on Long Island, said Richard Haggerty, CEO of OneKey MLS.

“We’re in uncharted territory, and I would not be surprised if the prices do not peak yet,” he said. “… You would think the prices would have had a chilling effect on buyers. I don’t see any signs of that.”

The market continues to give homebuyers fits because there are too few new listings. 

There was a slight uptick of 3.5% in houses on the market in Suffolk compared with last August but the number of listings in Nassau fell 7.5% from a year ago.

Across Long Island, the number of listings was down 1.4% compared with last year. There are still fewer than half as many homes on the market as there were five years ago in August 2019.

“That's not enough to level off prices, give buyers some more choices [or] switch to a more balanced market,” said Jerry O’Neill, an associate broker at Signature Premier Properties in Amity Harbor.

O’Neill said the Long Island market has been stuck in a catch-22 because there aren’t enough listings but sellers won’t put their properties up for sale because they don’t like their options to move into a different home.

“People are living with bigger houses than they need and people with smaller houses are making improvements,” O’Neill said.

Low inventory, in part, has also suppressed the number of sales. The number of closings in August was down 18% in Nassau compared with a year ago.

Suffolk County had a 3.1% year-over-year increase in closings.

Condo prices shoot up

Prices also surged in Long Island’s condo market, which was around one-tenth the size of the market for single-family homes last month.

The median price for a condo in Nassau County among 78 sales was $922,500, which was 36.7% higher than the median price a year ago.

The median condo price in Suffolk last month among 150 sales was $534,000, which was a 17.4% increase compared with August 2023.

Jamie Gorman, an associate broker at Charles Rutenberg Realty in Plainview, said she has started to see more options for homebuyers in communities such as Plainview, Syosset, Bethpage and Dix Hills, where she often markets homes. But they don’t stay on the market long.

“If you're not under contract within two weeks, there’s something wrong,” she said. “Within two weeks, it should be snatched up.”

Gorman said she has started to hear from more interested buyers as mortgage rates have fallen. Since July, the average 30-year fixed rate has fallen from 6.95% to 6.2%, according to Freddie Mac.

The Federal Reserve will meet this week to make a decision about whether to make a change to its benchmark interest rate for the first time since July 2023, when it raised the key rate to around 5.3% — the highest it had been since 2001.

It has held rates at that level for the past year in its campaign to bring inflation down toward its 2% target but is widely expected to reduce the key rate by at least a quarter of a percentage point on Wednesday. 

A rate cut would have "a positive effect for buyers who are already out there," Haggerty said. “I’m not sure it’s going to move the needle yet for sellers.”

If mortgage rates fall below 6%, more buyers could come out in the fall, Gorman said.

“I do feel like it’s going to be a busier fall,” Gorman said.

By Jonathan LaMantia

jonathan.lamantia@newsday.com@jonlamantia

Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.