Long Island Real Estate Market: Home Values Update May 2010

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The Long Island real estate market in May 2010 numbers are out and I am still waiting on June numbers to be released. With all the commentary about what happened to prices in the market, I think many homeowners are confused as to where the market is and where it is going.

For the purposes of this article, I’m going to look at one thing that tells the story of the entire market. It’s not prices per se, but inventory. I’m going to give you a statistic here that’s kind of scary if you understand it and appreciate it.

The standard of keeping track of statistics mostly centers around comparing one month or quarter to the years previous. So for instance, I’m going to give you May 2009 numbers of homes available vs. homes sold and then I’ll give you May 2010 numbers.

May 2009

Now I’ll provide May 2010 numbers for homes sold vs. homes available.

Now from these two time periods you’ll see that the only major difference is the homes sold were higher in May 2010. The available homes (inventory) appears to be just about the same with some slight variation.

But the real key to stat to look at is, if we just go back three months to February 2010.

Here we see some major changes to the market. Over 12,000 homes were added to the available market from February to May of 2010. That’s a gigantic leap of more than 25%.

That means, in general, in your area, if you had your home on the market in February and didn’t sell it and were still on the market in May, if there were 75 homes for sale in your area in February, there were nearly 100 homes for sale by May. Thus you were competing against 25 new homes for sale in your area. This gives buyers more options and when supply exceeds demand (as it does in all of these slides – there’s a lot less homes being bought then are listed for sale) that means one thing – prices must adjust downward!

This is the reality of our market. I continually go back to this statistic because it tells the story of what exactly is going on in the Long Island real estate market. Prices of SOLD HOMES may have risen during the month of May, as it was reported, but that could be attributed to many factors such as maybe the high end market sold more, thus throwing off the numbers (which is what many local experts are saying).

One thing is for sure, unfortunately for sellers, home values on Long Island are not going up. They are stagnant or declining slightly. One reason for the prices not dropping more rapidly has to do with the low mortgage interest rates.

It takes unique marketing strategies and cutting edge technology to sell homes in this market. That along with current and valuable real estate analysis will go a long way toward helping you sell your home in this very challenging market.

If you want expert analysis of your home’s value and want to discuss my comprehensive online marketing plans, please contact me at 631-831-9048.

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