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Home Value Forecast: Long Island CBSA Returns to Top 10

According to the U.S. Census Bureau, Nassau and Suffolk counties have the 10th and 26th highest median household incomes in the nation. Nassau County is also the third-richest county per capita in New York State and the 30th richest in the nation.

In January, 2014, the Nassau-Suffolk, NY CBSA lead Home Value Forecast’s ranking as the hottest real estate market in the nation. This month, the CBSA is back in our top ten. Let’s take a look at what’s changed and the factors responsible for its return.

Nassau-Suffolk, NY CBSA – Today

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The Nassau-Suffolk CBSA ranked seventh this month, showing healthy trends across the board. Sales are up 11%, while active listings are down 44% and Months of Remaining Inventory (MRI) is down almost 50% — all signs of a seller’s market. Another sign pointing to a tightening market includes Active Days on Market at 41, a 55.43% drop.

Let’s compare todays market with two years ago.

Nassau-Suffolk, NY CBSA – January, 2014

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Numbers look fairly similar, with a few exceptions.

  • The number of active homes on the market has increased, most likely due to increasing equity giving people the opportunity to move.
  • MRI is up, as one would expect when active listings go from 5,146 to 7,971.
  • Active Price is up to $469,000 versus $399,000 in 2014, with percent change at 10.61% today versus 6.4% in 2014. Active price is a good leading indicator on where the market is going.

CBSA Forecast – Then and Now

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Our forecast two years ago had the CBSA matching pre-crisis highs by 2019, our current forecast now shows more conservative appreciation, with pre-crash highs not expected within the next five years. So what’s happened?

At Home Value Forecast we like to say that all real estate trends are local, and what’s happening in one community doesn’t translate to the next. This is very true in Long Island, where the differences between wealthy communities and the rest is significant.

In Forbe’s magazine’s 2015 list of the 500 most expensive ZIP codes in America, Long Island was well represented with 26 communities. One of those was Roslyn, New York coming in at #336.

Roslyn real estate is at an all-time high, with average home price just shy of $1.2 million. At HVF we like to look at average sold price per foot of living space — a more consistent measure that is not effected by the mix of properties being sold.

Even looking at this more consistent value, prices are at all-time highs.

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An example of the other side of Long Island real estate market is Island Park, NY.  While less than twenty miles away from Roslyn, real estate realities are worlds apart.  Prices that peaked close to $500,000 in 2006 are now averaging around $288,000.

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Looking at price per square foot shows the same phenomenon:

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Putting it all together shows how averaging CBSAs does not show the entire picture, and while the real estate rebound is a reality in many communities there are still those lagging.

Of the 143 ZIPs we track in the Nassau-Suffolk County CBSA, as of today 84 are tracking above the CBSA average and 59 are below. Also, only 28 ZIPs in the CBSA, 19.6% of the total, now have sale prices above pre-crash levels. As the recovery continues, we look for that number to increase.

CBSA Winners and Losers

Each month, Home Value Forecast uses a number of leading real estate market-based indicators to rank the single-family home markets in the top 200 CBSAs and highlight the strongest and weakest metros.

The ranking system is purely objective and is based on directional trends. Each indicator is given a score based on whether the trend is positive, negative or neutral for that series. For example, a declining trend in active listings would be positive, as will be an increasing trend in average price. A composite score for each CBSA is calculated by summing the directional scores of each of its indicators. From the universe of the top 200 CBSAs, we highlight each month the CBSAs which have the highest and lowest composite scores.

The tables below show the individual market indicators that are being used to rank the CBSAs, along with the most recent values and the percent changes. We have color-coded each of the indicators to help visualize whether it is moving in a positive (green) or negative (red) direction.

Top 10 CBSAs

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Top ten this month includes eight western CBSAs, including Oakland-Hayward-Berkeley, CA. In last month’s Home Value Forecast we spoke of economic displacement in San Francisco, and its impact on outlying communities.

Oakland, with its close proximity to San Francisco and “up and coming” reputation, is seeing a boom in many of its neighborhoods and boasts the lowest Months of Remaining Inventory (MRI) in our Top Ten at 2.55.

Bottom 10 CBSAs

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Madison, Wisconsin is new to our bottom ten. In late 2015 Oscar Mayer announced it would close the local plant and move 1,000 jobs out of the community. This seems to be having a similar impact as Midland, TX is experiencing with the loss of oil industry jobs.

About Home Value Forecast

Home Value Forecast (HVF) is brought to you by Pro Teck Valuation Services. HVF provides insight into the current and future state of the U.S. housing market, and delivers 14 market snapshot graphs from the top 30 CBSAs.

HVF is built using numerous housing and economic data sources. The top 750 CBSAs as well as data down to the ZIP code level for approximately 18,000 ZIPs are available with a corporate subscription to the service.

Also, Pro Teck Valuation Services offers reporters the following:

  • National, regional or metro level housing data
  • Monthly Updates and HVF Insights articles
  • By-request data for your story — custom data, heat maps and charts are available
  • Expert commentary from Home Value Forecast Editorial Committee:
    • Tom O’Grady, Chief Executive Officer, Pro Teck Valuation Services
    • Michael Sklarz, PH.D., President, Collateral Analytics
    • Jeff Dickstein, Chief Compliance Officer, Pro Teck Valuation Services