Catch me if you can: Long Island hits 13-year sales record

As residential prices continue to rise steadily, Long Island can’t keep up with demand.

In the first quarter of 2016, Long Island saw the most first quarter sales in 13 years with 5,478 closed sales, according to a sales report released by Douglas Elliman on Thursday. The jump represents a 28.4 percent year-over-year increase in sales volume. Jonathan Miller, president of Miller Samuel and author of the Elliman report, said inventory — which slipped nearly seven percent since the first quarter of 2015 — can’t keep pace with sales. The absorption rate was seven and a half months, the fastest first quarter pace in at least 13 years, according to the report.

“Since mid-2015 the suburban markets outside New York City, are all seeing a surge in sales activity,” he said. “The affordability challenge in NYC is causing extra or additional demand in the outlying suburbs.”

Median sales prices only increased a modest 2.6 percent to $370,000 from the same time last year, continuing at what Miller calls a “steady grind.” As with many other markets in New York City, Long Island is experiencing a softening luxury market but stronger conditions in the entry- and mid-markets.

After a banner end to 2015, the Hamptons seem to be leveling out. In the final quarter of 2015, the average sales price hit $2.3 million, an 11-year high for the area, according to another Elliman report. The average sales price dropped 20.6 percent this quarter from the last to $1.9 million, but still showed a 7.4 percent year-over-year increase. The median sales price also decreased 2.8 percent year-over-year to $895,000. But you shouldn’t read too deeply into the comparatively lackluster quarter: last quarter was an outlier for the region.

“I think the bigger macro takeaway from this, is after a couple of years of elevated sales growth and price records, 2016 may turn out to be more sustainable with more modest sales activity and modest sales growth,” he said.

Meanwhile, the North Fork is having something of a moment. Median sales prices reached $550,000, the highest first quarter price recorded in more than a decade and the highest ever reached since the financial crisis struck in 2008. The market on the North Fork is mimicking suburban markets, in that the mid-market conditions are stronger than luxury — unusual in an area that revels in vacation homes. Still, Ernest Cervi, the East End executive managing director for the Corcoran Group, that demand for luxury properties on the North Fork is growing.

“We see a shift in those purchases at the higher end,” he said. “It’s not just people going there for lower priced properties, so the mix is changing.”