Luxury Home Market In The HV Showing Signs of Cooling Off: Report

RYE BROOK, NY — The once red-hot COVID-driven luxury market North of NYC is now simmering as the pandemic fades from buying decisions.

Luxury sales in Westchester (sales $2 million and higher) and Putnam and Dutchess counties (sales $1 million and higher) posted declines in the first quarter of 2023, according to the Houlihan Lawrence Q1 Luxury Market Report released Friday.

According to the report, a myriad of after-effects of the pandemic are affecting the real estate market — including lack of inventory.

So many luxury buyers and sellers accelerated their plans during COVID that the current pool of buyers and sellers is understandably smaller than during the pandemic, the report said.

Rising interest rates are also a factor. Those who want to sell are holding onto their below 5 percent interest rate mortgage while waiting for a more favorable interest rate environment and new inventory from which to choose when they make their next purchase.

"Nonetheless, there are buyers in the luxury market. Well-priced, well-presented listings are selling. Persistent supply chain issues have increased demand for move-in condition, and aptly priced, updated luxury offerings are often rewarded with multiple offers at the lower end of the luxury market," said Anthony P. Cutugno, Sr. Vice President, Private Brokerage for Houlihan Lawrence. "Conversely, ambitiously priced, poorly presented listings are overlooked. Concerns of overpaying are on every buyer’s radar as the fear of a longer, deeper recession looms on the horizon as a result of the banking crisis."

However, the region north of New York City remains a resilient market and supply/demand underscores this outlook. He said the luxury market in Westchester still favors sellers, while Putnam and Dutchess counties show signs of softening after skyrocketing in popularity during the height of COVID.

Looking ahead, Cutugno said, "Inventory is building in the $10M+ price range. However, Q1 closed and pended sales indicate that 2023 should be able to match $10M+ sales achieved in 2022, even as, or perhaps because of, the uptick in supply."

First quarter 2023 versus Q1 2022

Westchester County Luxury Home Sales /$2M and Higher

• Homes Sold: Down 24%
• Median Sale Price: Up 3.2%
• Highest Sale Price: $13,550,000 in Bedford

Putnam and Dutchess County Luxury Home Sales /$1M and Higher

• Homes Sold: Down 64.3%
• Median Sale Price: Up: 4.9%
• Highest Sale Price Putnam: $2,000,000 in Haldane
• Highest Sale Price Dutchess: $1,705,000 in Clinton

Founded in Bronxville in 1888, Houlihan Lawrence has 30 offices and 1,450+ agents serving Westchester, Putnam, Dutchess, Columbia, Ulster and Orange counties in New York and Fairfield County in Connecticut.