The recovery of the Queens housing market now appears to be well under way. While demand is still high even with credit conditions constraining buyers, the low level of inventory is having a significant effect in most neighborhoods. Due to current market conditions, May saw a significant jump in sales velocity. April & May typically see the most significant gain in inventory in any given year, meaning low levels of inventory are likely to persist throughout the year. Prices continued to rise in April, marking the sixth consecutive month of gains in median price. With affordability still at historically high levels, the market continuing to improve, and inventory lending advantage to sellers, it could be an opportune time for a well-informed buyer or seller to enter the market.
Interest rates ticked up to 4.125% this month. With yields on treasuries rising due to overall economic recovery and anticipation of the Federal Reserve cutting back on monetary easing, we could see mortgage rates slowly trend up in the future.
Home sales in May reached a seasonally adjusted annual rate of 698, an 11.1% increase from April and a 10.8% increase from May of 2012. This is the fastest annual sales pace the market has seen since the 2009 tax credit. May would have been the sixth consecutive month of year-over-year gains, however, super storm Sandy caused sales to dip in February & March. Even with these gains, the market is still being constrained by tight credit and inventory. The robust housing market recovery is occurring in spite of tight access to credit and limited inventory. Without these frictions, existing-home sales easily would be well above the current pace.
Queens NY Home Prices
Median home price was $360,000 in May, no change from April but a 4.3% increase from the same month last year. This makes May the seventh consecutive month of year-over-year price gains. The last time the Queens saw this many consecutive gains in median house price was in the lead up to the housing crisis from April 2005 to May 2006.
Queens NY Housing Inventory
Inventory saw a moderate decrease in May, dropping 1.2% from April levels to a supply of 9.57 months. There are currently 6,204 homes for sale in Queens County, that’s 27% lower than what we saw in May of 2012 and is still representative of a firm seller’s market in many neighborhoods of Queens. Residential Homes and Condos are in high demand among buyers, however, we are experiencing the biggest shortage with these types of properties. There is still a large supply of Coops on the market and Buyers typically have more leverage at the negotiating table when it comes to Coops due to the large amount of competition. In any case, there are still less Coops on the market than there were last year.