Long Island home sale contracts surge in June

Long Island home shoppers came out in force last month.

The number of buyers signing sales contracts jumped by 26 percent in Nassau County and 15 percent in Suffolk County in June compared with a year earlier, the Multiple Listing Service of Long Island reported Wednesday.

The burst of contract signings translated into modest gains in pending sale prices. Nassau homes went into contract for a median price of $459,500, up 2.2 percent from a year before, and Suffolk homes fetched a median contract price of $340,000, up 3 percent from June 2014.

The picture was more mixed for closed home sales, which typically had gone into contract two to three months before.

The number of closed home sales fell by 3.1 percent in Nassau and rose by 1.3 percent in Suffolk, the listing service reported. In Nassau, homes closed for a median price of $445,000, a 3.7 percent annual gain. Suffolk homes made similar price gains, with the median closing sale price rising by 3.8 percent, to $342,500.

Demand is especially strong for "starter" homes in the $300,000 to $400,000 price range, said Teri Catapano Black, broker-owner of Century 21 Catapano Homes in Bethpage. "With the current interest rates, many young buyers realize it's a better option to buy than to rent," she said.

The activity at the lower end gives a boost to homes in the $475,000 to $575,000 range, since it allows the sellers of starter homes to trade up, she said.

The average interest rate for a 30-year, fixed-rate mortgage was 4.04 percent last week, down from 4.15 percent a year earlier, mortgage giant Freddie Mac reported.

The surge in sales contract signings "is showing that there's buyer confidence in the economy," said Richard Meyer, a Bellmore-based appraiser and a past president of the Long Island chapter of the Appraisal Institute, a trade group.

However, he said, it doesn't necessarily mean that prices will make dramatic gains. "Unfortunately, in my opinion, if the rates start to tick up significantly we're going to see a slowdown," Meyer said.

The number of homes listed for sale inched up in Suffolk to 11,043, an increase of 1.2 percent compared with a year earlier. It would take 9.6 months to sell all those homes, at the current pace of sales.

In Nassau, the number of homes on the market dropped by 2.3 percent year over year, to 7,412, a 7.5 month supply.

A balanced real estate market has a six- to eight-month supply of homes, brokers say.

By Maura McDermott

maura.mcdermott@newsday.commauramcdermott

Maura McDermott is a reporter on the investigations desk. Since starting at Newsday in 2012, she has also covered real estate and the business of health care.