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Surging demand sends Hudson Valley home prices soaring
Home prices in the northern Hudson Valley continued to surge through the spring, with the median sales price in both Columbia and Greene counties rising more than 40 percent in 12 months, according to a new report.
The report, by Hudson Valley Pattern for Progress, a nonprofit policy organization, also shows home prices rising 31 percent in Sullivan
County and 25 percent in both Ulster and Dutchess counties.
A flood of new arrivals fleeing virus-prone urban areas and a limited number of properties created the unprecedented surge, but the report and local Realtors suggested the wave may be cresting.
Rip Van Winkle Realty principal owner Ted Banta described the market as “2006 on steroids.”
Downstate residents began moving to Columbia County about 15 years ago, and the interest later spread to Greene County, Banta said, but the pandemic kicked the migration into high gear. The new arrivals now come from farther afield.
"In Greene County, we’ve had migration not just from the tri-state area, but from the West Coast," Banta said. “I’ve had buyers from Oregon, California and Washington.”
The huge surge in demand caused the supply of homes on the market to drop. The report notes that Columbia County only has 4.5 months of housing inventory — defined as the amount of
time it would take to sell off all houses currently on the market — while Greene County has 3.9 months. Fewer than 6 months of inventory indicates a seller’s market.
Banta said many of the properties sold during the pandemic went for over the original asking price as multiple buyers tried to outbid one another.
Columbia Greene Board of Realtors President Angela Lanuto said the new sales were not concentrated in a particular part of the Twin Counties, though river towns such as Athens, Catskill and Germantown were especially popular.
The rise in home prices extended to the rental market, Lanuto said.
“Rentals are very few and far between, so what that’s doing is, again, driving that demand up,” she said. “What would normally be an $800 onebedroom is now a $1,000 one-bedroom, because there’s a lack of inventory, and people are still looking for rental properties.”
While rising home prices can be a boon to homeowners, they are often a burden for renters, who are generally less well-off.
Kingston Tenant’s Union co-founder Rashida Tyler said rental prices have “absolutely exploded.”
“I was looking yesterday for one-bedroom rentals – one was $1,900, another was $1,800. I can’t find a two-bedroom at all,” she said. “In Kingston, the housing stock has disappeared.”
Even residents who already have leases are being negatively impacted, Tyler said.
“We have a lot of people right now who are being displaced, not because they haven’t paid their rent or anything on their end, but because the landlord has decided to sell their building and a new landlord has come in and doesn’t want the current tenants there,” she said.
In these situations, landlords can simply refuse to renew the lease.
The surging market influenced some homeowners to sell, according to Banta.
“People are looking to take advantage of this current market,” he said. “We don’t know if the market will be in a bear next year, we don’t know if interest rates will rise.”
The number of home sales is rising, according to the report, indicating a less constricted market. In Greene County, home sales rose after dropping in the midst of the pandemic last year, going from 147 in spring 2020 to 210 in spring 2021.
The regional housing market is not as “frenzied” as it was last fall, according to the report, when it was dealing with pent-up demand from the lockdowns.
“What we have now is a robust but more normalized seller’s market driven mostly by fundamentals like good economic conditions, low interest rates and limited supply, all of which continue to drive prices up,” according to the report, which stated prices will continue to rise through the end of the year.
Eventually, prices will come down, Lanuto said.
“Those people that decided to list their homes at a premium and haven’t sold them yet, they’re going to start bringing the price down to where they should have been listed originally, and that’s going to help neutralize the market a bit,” she said.
However, in the world of COVID-19, there are still many unknowns. A resurgence of the pandemic could shut New York City, sending downstate residents once again to less contagious environs.
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The huge surge in demand caused the supply of homes on the market to drop. The report notes that Columbia County only has 4.5 months of housing inventory — defined as the amount of time it would take to sell off all houses currently on the market — while Greene County has 3.9 months. Fewer than 6 months of inventory indicates a seller’s market.”