The first quarter of 2021 was “one for the books” for the suburban New York City residential market.

WHITE PLAINS—The first quarter of 2021 was “one for the books” for the suburban New York City residential market.

In the era of COVID-19, residential sales in the Hudson Gateway Association of Realtors’ market area plummeted early on and slowly increased as restrictions were lifted. In the first quarter of 2021, sales skyrocketed to new highs in almost all sections of the region with transactions increasing by astounding rates ranging from as high as 62.4% to 31.6%.

While the level of activity has many veteran Realtors shaking their heads in disbelief, most admit that the feverish level of sales activity will not be sustainable due at least in part to low for-sale inventory levels.

According to the recently released first quarter home sales report by OneKey MLS, Putnam County led the HGAR region with a 62.4% increase in residential sales as compared to the first quarter of 2020 (prior to the onset of the COVID pandemic), followed by Sullivan County at 62.3%; Orange County with 54.2% higher sales; Rockland County, which posted a 36.5% increase in transactions, Westchester County, which notched a 35.3% increase in sales and the Bronx which enjoyed 31.6% higher home sales in the first three months of this year. Editor’s Note: For the full OneKey MLS report and charts see pages 15 and 16.

The tremendous surge in home sales was described by the authors of the OneKey MLS report as staggering” and “unprecedented.”

Breaking down units sold, Westchester County saw 2,462 units trade as compared to 1,819 units in 2020. Orange County’s sales rose from 896 units in 2020 to 1,382 units in the first quarter of 2021, Putnam registered 427 sales as compared to 263 in 2020 and Sullivan County closed 362 units from 223 units in 2020. In Rockland County, sales increased to 823 units from 603 in 2020. Sales in Bronx County increased to 567 units this past quarter as compared to 431 units in the first quarter of 2020.

Median single-family home sales prices increased sharply in every area of the HGAR region. The median sale price for a single-family residential unit in Orange County rose 22.5% to $340,000 (from $277,450 one year ago) while Sullivan County’s median price spiked 35.2% to $221,00 from $162,250 one year ago.

The median price for a single-family home in Westchester County rose 10.8% to $708,995 from $640,000 last year. The median sale price for a single-family residence rose by 16.4% in Putnam County to $390,000 (from $335,000), in Rockland County the median price increased by 14.4% to $525,000 (from $459,000) and in Bronx County the median rose 4% to $541,000 (from $520,000) as compared to the first quarter of 2020.

The spike in sales in the first three months of this year was not limited to just single-family homes. The condominium and cooperative markets benefitted from high demand as well. In Westchester County, the region’s top condo and co-op market, sales rose 32.6% and 30.5% respectively. The median sale price for a Westchester condominium fell 3.8% in the first quarter of this year to $375,000, while the co-op median price increased 9.8% in Westchester to $192,750. There was a 40.9% increase in condominium sales in the Bronx in the first quarter of 2021, while cooperative sales jumped 21.2% in that same time period. The median sale price of a Bronx condo rose 10.3% in the first quarter of this year to $305,000, while a Bronx co-op’s median price increased 20.5% to $244,000.

While most data points point to a very bullish home sales market going forward, declining inventory levels are giving real estate professionals some pause. End of quarter inventory was down 13.2% in Westchester; 52.0% in Rockland; 52.6% in Orange; 49.9% in Sullivan and 53.2% in Putnam. While single-family inventory was down 21.4% in the Bronx, inventory increases in other market segments caused overall inventory to rise 19.2% in the borough in the first quarter.

While prices are rising, Realtors contend that the current market presents opportunities for sellers, due to low inventory and buyers thanks to low interest rates. They also expressed hope that inventory levels will rise in the coming months to accommodate the strong buyer demand.

HGAR President Crystal Hawkins-Syska described the level of activity in the first quarter as a “madhouse” when it came to the sense of urgency and competition that took place in the market. She recalled, “Properties were coming off the market within three or four days.”

The level of activity raises some concerns for Syska, who is an Associate Broker with Keller Williams NY Realty of White Plains. She noted that the sales activity is simply not sustainable.

She did note that Realtors are beginning to see more properties coming on the market and a rising consumer confidence due to the COVID vaccination efforts now underway.

However, Realtors should begin to prepare for changing market conditions now and look to educate their prospective buyers who in the future may get frustrated.

Syska also cautioned, “It is usually in this type of (sales) environment that we can make the most mistakes,” she said. “So, we have to really pay attention to our practice, especially because of fair housing.

Joseph Rand, chief creative officer at Howard Hana | Rand Realty, said that the northern suburban markets of New York City had been slowly recovering from the downturn in 2009 and suffered a setback due to the imposition of the SALT cap beginning in 2018.

“Now the market has just exploded in the last year and even COVID hasn’t been able to hold it back, the SALT cap hasn’t been able to hold it back and that is why we are starting to see all-time highs in a lot of these markets for sales and prices,” Rand said in a webinar presentation of the firm’s first quarter home sales report for its market area.

Brokerage firm Houlihan Lawrence in its first quarter market report noted that the inventory shortage has made it challenging for buyers looking to relocate out of the city and for sellers to make a move.

“If the opportunity avails, there is no better time to list your home. There is high demand in all three counties and most price points. The number of showings has increased considerably year over year, and with fewer homes on the market, it is typical to have more than one buyer interested in a property. This is creating multiple bid situations on properly priced homes, and sellers are reaping the benefit,” said Elizabeth Nunan, president and CEO, Houlihan Lawrence.

The strong sales market in the first quarter extended to the luxury sector. Sales of luxury homes of $2 million and higher in New York’s northern suburban markets in the first quarter of this year registered double- and triple-digit gains compared to 12 months earlier. Robust buyer demand during the typically slow holiday period of late fall/early winter yielded the strongest first quarter of closed sales in a decade, according to the Houlihan Lawrence Luxury Market Report.

“One year ago, when the country was in a COVID-19 lockdown, it was hard to imagine that residential real estate would experience a V-shaped recovery fueled by seismic shifts in consumer behavior. Luxury real estate north of New York City is the beneficiary of these well-documented changes. A substantially larger buyer pool coupled with declining inventory has generated a consistent rise in luxury sales since last summer,” said Anthony P. Cutugno, senior vice president, director of private brokerage for Houlihan Lawrence.