Long Island home prices break records again in May, with listings scarce

Long Island homebuyers purchased at record prices in May, as the region’s shortage of homes for sale helped sustain a seller’s market.

The median price in Nassau County was a record $790,000 among single-family home sales that closed in May, which was 13% higher than in the same month a year ago, according to data published Monday by OneKey MLS.

In Suffolk County, the median sale price rose 14.2% in May to a record $651,000. The data reflect market activity across the past several months, as it can take weeks or months for deals to reach closing on Long Island.

Agents said they have seen positive signs — at least in Suffolk County — that buyers may soon have more options to choose from and less competition.

The number of single-family homes on the market in Suffolk increased 8.1% to 2,707 by the end of May compared with the same time in 2023. Available listings have been consistently shrinking since the COVID-19 pandemic started in 2020, which has helped tilt the market toward sellers and increase prices.

In Nassau, the dynamic has yet to change. The number of single-family homes for sale fell 17.4% to 1,932 at the end of May compared with the same point a year ago.

The Island will have a long way to go to satisfy buyers with plentiful listings. There are fewer than half as many homes on the market as there were in May 2019.

“The only thing that will start to moderate prices is more inventory,” said Richard Haggerty, CEO of OneKey MLS.

The scarcity of available homes has hurt sales volume. The number of single-family home sales in Nassau fell 16.8% to 603 in May compared with the previous year. 

In Suffolk County, the number of closings rose 2.2% to 893 in May.

Elevated mortgage rates haven’t seemed to dampen demand from buyers, Haggerty said. Instead, the rise in mortgage rates has convinced homeowners to stay put, hurting the market's balancing act. The average 30-year fixed mortgage rate was 6.95% for the week ending Thursday, according to Freddie Mac. Last year in mid-June, the average rate was 6.69%.

Mortgage rates have failed to drop as expected in the first half of the year. Investors expected the Federal Reserve to cut its benchmark interest rate multiple times this year, possibly as early as the spring, which could have led to lower mortgage rates.

But with consumer prices still increasing faster than the Fed’s annualized target of 2%, Fed policymakers have held rates steady. The Fed signaled last week it expects only one rate cut before the end of the year.

“It has continued to slow sellers from making decisions,” Haggerty said. “It is definitely not, from my perspective, slowing buyers from jumping in the market whenever they see an opportunity."

One example of buyers’ demand: The average sale in both Nassau and Suffolk last month sold for more than its asking price, according to the data. Typically, the average sale includes a listing discount from its asking price.

Angela Prince, a real estate broker with Weichert Realtors who leads a team of agents in Bay Shore, said she’s noticed more houses for sale than last year, when she felt as if there was virtually nothing. But she believes the scarcity of homes has kept homeowners from testing the market.

“You have a lot of sellers that are scared to sell because now they become that buyer. Now they need a place to live,” she said. "They don't want to deal with it."

Several agents said they have seen the pace of deals slow in recent weeks.

Tim Galligan, a real estate agent and team leader at Keller Williams Points North in Woodbury, said with mortgage rates little changed from last year, the reality is setting in for buyers that they may be saddled with higher monthly payments for a longer period of time before they can refinance.

That gives them less of an incentive to move quickly to get into a home, he said. 

Galligan said he continues to see a large number of people at open houses but fewer are making offers after touring.

Local buyers “are becoming a lot more selective,” he said.

Carol Szynaka, an associate broker at Daniel Gale Sotheby’s International Realty in Cutchogue, said the North Fork saw a noticeable increase in listings after April 1, giving buyers more options than the past few years.

“2023 we had no inventory,” Szynaka said. “It was very, very tight. Now, we have inventory. People have choices. The urgency isn’t quite what it was.”

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.