New York Real Estate Market: What to Expect In 2024 & 2025?

The current median home sale price of $561,600 is stable and rising steadily at 6.3% YoY. Moreover, homes spend only 29 days on the market. This indicates that the New York real estate market is pretty much competitive.

The average months of home supply are 3 months YoY. A market with fewer months of supply indicates a seller’s market. However, the number of homes sold raised by 3.3% YoY in July. There were 11,908 homes sold in July 2024, down 11,528 homes sold in July 2023.

Despite such high volume there may be some adjustments due to the recent NAR settlement. People are anxious about the selling prices and agents’ compensation.

The NAR settlement has removed the buyers’ agent compensation and many MLSs have followed the suit. It will probably reduce the home selling prices. As a result, buyers will have improved affordability along with low mortgage rates. Here are some tips for you to sustain in the market:

• If You Are a Home Buyer: Homes for sale (50,165) are growing at 2.6%. Along with this, the expected drop in home prices can benefit you. The low interest rates at 6.50%-6.54% are now in buyers’ favor. Also, in case of low housing demand and prices, you can request for seller concessions.
• If You Are a Home Seller: You can lock in New York’s current high home prices. The correction in the home prices is long overdue. In the wake of the NAR settlement, home prices may drop a little more. If you’re a seller, you can still make profits on home sale before prices potentially drop.

So, How Is the Real Estate Market in New York?

Balanced!

The number of homes for sale increased by 2.6% in July 2024 compared to the previous year. This is the 5th consecutive month the housing market has witnessed such growth. Other important facts are:

• Median Days on Market: The median days on market for homes for sale are 29 days, down by 2 days YoY. This trend suggests a high demand in the New York real estate market.
• Housing Inventory and Supply: As a buyer, you have more options now as the housing inventory is up by 2.6%. There are 50,165 homes for sale in New York, with an average supply of 3 months.
• Average Home Prices: The median home price in New York is $561,600. But, it is expected to decrease due to a rise in inventory in the latter half of 2024. The sale-to-list price ratio is 102.9%, up by 0.2 pt YoY.
• Home Sales: As per July 2024 data, home sales decreased by 3.3% YoY! Only 11,908 homes were sold, compared to 11,528 last year.
• Average Rent Prices: Rental costs vary statewide. The median rent is $3,600 with month-over-month change is -$25.

Why Is New York a Seller’s Market Now?

New York real estate market has balanced inventory of homes for sale. Besides this, a steady increase in median home prices, favors home sellers. Homes spend only 29 days on the market which depicts the competitive market.

Let’s look at some more facts:

• Fewer Days on the Market: Homes are spending only 29 days on the market before going under contract. This is visible in metro cities like Lockport and Guilderland where the average days on market is between 8 to 11 days.
• Multiple Offers on Homes: Guilderland has got 93 and Cicero got 87 in Redfin’s Compete Score. It means the housing market in New York is very competitive. It shows that many homes get multiple offers, some even sold without contingencies.
• High Sale-To-List Price: The average homes sell for about 48.0% above list price. The average sale-to-list price ratio in Guilderland is 106.2%.

• Homes Sell Above List Price: On average, 48.0% homes sell above list prices. However, in July, 24.1% of homes experienced price drops, compared to 20.5% last year. This trend indicates a gradual shift toward a buyer’s market.

New York Housing Market Predictions 2024

Here are the predictions for New York’s housing market in the remaining months of 2024 and 2025:

1. Number of Home Buyers Will Increase: As inventory grows and homes stay on the market, more home shoppers are expected to re-enter the market. The historically high interest rates averted buyers in 2023. But the easing inflation and stabilizing rates will bring back house hunters.
2. Home Prices Will Continue to Rise: Home prices rose steadily in the top metros across NY YoY, reaching $562K in July 2024. Cities like Kingston and Rochester expect a surge in home prices 3.2% by April 30th, 2025.
3. New Home Constructions Sales Will Increase: As per New York Building Permits Survey, 1,396,000 new private housing units were authorized. New York’s housing market’s high demand will be served with the new constructions.
4. iBuyers Will Continue to Make Lowball Offers: iBuyers like Opendoor and Offerpad, which once offered 104.1% of market value in 2021, now offer around 70%. Such lowball offers to sellers will increase opportunities for individual buyers.

Bonus Predictions: Buyer Broker Commissions Will Be Zero!

In a shocking turn of events, the NAR settlement has completely eliminated buyer agent fees from the MLS. Let’s understand its impact:

1. Buyer Agents Will Be Affected: With buyers now responsible for directly paying their agents, many may choose to find their homes on their own. This may very soon render buyer agents obsolete.
2. Seller Concession Will Increase: Without the obligation to pay buyer agent commissions, sellers might see increased requests for seller concessions and offline transactions. Additionally, builders are offering significant concessions to attract buyers, further influencing the market dynamics.
3. Builders Will Compete More: Home builders are persuading buyers to buy new construction homes with mortgage buydowns worth $30K!
4. Sellers May Offer Fees for Services: Sellers may offer at least 1%-2% fees to the buyer agents in order to sell their homes quickly. Increasing competition from builders may also cause sellers to pay extra fees to buyer agents.

Is the Housing Market in New York Going to Crash?

A housing market crash in the Empire State is unlikely.

New York boasts one of the nation’s most thriving economies. The household income in NY is $81,386, which is higher than the U.S. average. Some top cities in New York are poised for home price growth.

Rochester shows a projection of 2.1% rise by May, 2025. New York City, with 8.2 million population, is the largest city in the state. It’s a global financial hub, home to major companies like JPMorgan Chase and Pfizer. It is the fastest-growing city in New York.

New York’s job market is also strong. The unemployment rate is only at 4.3% and its private-sector added 137,300 new jobs in the past 12 months. This affordability, combined with strong economy, makes a housing market crash in New York unlikely.

2024: Is It a Buyers’ or Sellers’ Market Now?

New York real estate market favors sellers in 2024. (And buyers, too!). The New York real estate market is expected to lean more in favor of the buyers in the latter half of 2024.

Home prices are rising slowly, and the number of homes for sale has increased by 2.6% YoY. Buyers now have more choices. With mortgage rates around 6.54%, buyers also have more purchasing power.

Consequently, more homeowners are likely to list their homes on New York MLS. The 7.1% increase in new active home listings in New York has brought back home shoppers. So, whether you are looking for a condo in Lockport or a single-family primary home in Guilderland, you will find your dream home in the coming months.

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Disclaimer: This article is for informational purposes only. It does not constitute an offer, solicitation of an offer, or any advice or recommendation. Houzeo doesn’t provide any legal or financial advice. The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Houzeo Corp., its affiliates, or its employees. However, the author does not make any representation or warranty, express or implied, as to the information’s accuracy or completeness, nor does the author recommend that the attached information serve as the basis of any investment decision.

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