New York Housing Market Trends 2025: Is the Tide Turning for Buyers?

                                          By Marco Santarelli

Sometimes, what looks like good news on the surface can hide a few bumps in the road when you dig a little deeper. That’s certainly what I’m seeing as I pore over the latest New York Housing Market Report. While inventory (the number of homes for sale) is finally growing, which is a welcome sight after years of tight markets, actual home sales took a noticeable dip in May. This suggests a bit of a mixed bag for buyers and sellers across the Empire State.

New York Housing Market Trends 2025: Is the Tide Turning for Buyers?

When I look at the recent numbers, it’s clear we’re in a period of adjustment. For a while now, it felt like homes were being snapped up faster than you could say “closet space.” Now, things are shifting.

The Headline: Sales Dropped, But Inventory Rose
The core takeaway from the New York State Association of REALTORS® (NYSAR) report for May 2025 is stark: closed home sales in New York fell by 10.9 percent compared to last year. We went from 8,807 sales in May 2024 down to 7,846 homes last month. That’s almost a thousand fewer families moving into new homes in just one month.

My initial thought when I see a drop like that is, “Uh oh, what’s going on?” But then I see the other side of the coin: housing inventory went up. This is the third month in a row that we’ve seen more homes on the market. Inventory grew by 3.6 percent statewide in May, from 27,806 houses in May 2024 to 28,810 available last month.

So, why are sales down if there are more homes to choose from? That’s the million-dollar question, isn’t it? It usually points to a few things working together, which we’ll get into.

My Opinion on the Big Picture
This snapshot tells me we’re seeing some interesting dynamics. The drop in closed sales, while stark, isn’t necessarily a sign of a crashing market. It’s more likely a reflection of moderation. Buyers are having to adjust their expectations, especially given that prices are still going up, even with more homes available.

I’ve been in this business for a long time, and one thing I’ve learned is that the market rarely moves in a straight line. It’s more like waves. We had a huge surge, and now we’re seeing some of that energy dissipate, but not disappear entirely. The fact that median sales prices are up for 22 consecutive months tells me there’s still underlying demand, even if fewer deals are closing each month.

Diving Deeper into the Numbers
Let’s unpack each of these key indicators a bit more.

The Sales Slump: A Closer Look at Closed and Pending Sales
Closed Sales: The 10.9 percent drop in closed sales is definitely the most eye-catching number. What does this mean for someone looking to buy or sell? For sellers, it means the days of multiple, over-asking offers might be slowing down. For buyers, it might mean a little less competition, but as we’ll see, prices aren’t exactly falling.

Pending Sales: These are a peek into the future. Pending sales tell us how many homes had an offer accepted and are just waiting to close. They slipped slightly too, down 1.4 percent year-over-year. This small dip, however, isn’t as dramatic as the closed sales drop. It suggests that while the pace slowed down a little, demand for homes is still fairly robust. If pending sales fell off a cliff, that would be a much bigger red flag for me. The small dip suggests a bit of a pause, not a full stop.

My take: I think part of the reason for the closed sales dip, despite rising inventory, is that buyers are becoming more cautious. They might have been holding out for lower interest rates or more price drops, which haven’t really materialized. This caution translates into longer decision times and, ultimately, fewer completed deals in a given month.

Inventory: The Buyer’s Best Friend (Finally!)
For what feels like ages, the drumbeat in real estate has been “low inventory!” Buyers have faced intense competition, often needing to make quick, aggressive offers. Now, inventory is up again, 3.6 percent in May. This is huge for buyers. More homes mean:

.  More Choices: You’re not stuck with just one or two options.
.  Less Pressure: You might have a little more time to think, get inspections, and negotiate.
.  Potentially Better Deals: While median prices are up, more supply might put a tiny bit of downward pressure on asking prices or give buyers more room to ask for concessions.
My personal experience: I’ve seen firsthand the frustration of buyers in a super-hot market, getting outbid again and again. This growth in inventory, even if it’s modest, is a breath of fresh air. It shifts the market slightly more towards balance, which is healthy for everyone in the long run.

Median Sales Price: The Unstoppable Ascent?
Despite fewer sales, the median sales price in New York rose by 3.8 percent in May, hitting $436,000. This is the 22nd consecutive month that median sales prices have increased. This blows my mind a little. Even with more homes and fewer sales, prices continue their upward climb.

Why is this happening?

.  Strong Underlying Demand: People still want to live in New York, whether it’s up north or closer to the city. There’s a fundamental desire for homeownership.
.  Inflationary Pressures: Construction costs, labor, and materials haven’t gotten cheaper.
.  Buyer Acceptance: Many buyers, especially those who have been saving and watching the market for a while, may have accepted that higher prices are the new normal.
My practical thought: If you’re a buyer, this means don’t wait for a huge price crash. While some individual homes might see price adjustments, the overarching trend shows continued appreciation. For sellers, it means your investment is likely still growing, even if your home doesn’t sell in a week.

Mortgage Rates: A Small Glimmer of Hope
Mortgage rates stayed pretty steady in May, averaging out to 6.82 percent for a 30-year fixed-rate mortgage, according to Freddie Mac. Last May, the average was higher at 7.06 percent. So, we saw a slight drop, which is good.

.  Impact on Buyers: Even a small dip in mortgage rates can make a difference in monthly payments. For a $400,000 loan, dropping from 7.06% to 6.82% could shave off about $60-$70 a month, which adds up!

.  The “Lock-in” Effect: Many homeowners bought or refinanced when rates were much lower (think 3-4%). Selling now means giving up those low rates and taking on a much higher new one. This keeps some potential sellers from listing, even if they want to move. This “lock-in” effect is something I see impacting supply more than many realize.

From my perspective: These rates are still higher than what many buyers are used to, especially if they remember the super-low rates of a few years ago. High rates eat into affordability and can definitely cause some buyers to pull back or adjust their budget downwards. The slight dip is positive, but we’re still in higher-interest territory.

Days on Market and Percent of List Price Received
The report also showed that Days on Market (DOM) decreased to 50 days from 54 days last year, a 7.4% drop. This means homes, on average, are still selling pretty quickly once they hit the market.

And, Percent of List Price Received edged up slightly to 102.8% from 102.5% last year. This tells me that sellers are still getting more than their asking price, on average. Combining these two data points provides a really interesting view of the market.

My analysis: Even with a sales slowdown, the quality of the sales that are happening are still strong for sellers. If homes are selling quickly and for more than asking, it suggests that the homes that are priced well and in good condition are still attracting competitive offers. The buyers who are in the market are serious and willing to pay. This isn’t a buyer’s market yet, not by a long shot, but it’s not the frantic seller’s market we saw a year or two ago either. It’s a bit of a tug-of-war.

Months Supply of Inventory: How Fast are Homes Selling?
The “months supply” tells us how long it would take to sell all the homes currently on the market if no new homes came up for sale, at the current sales pace. A balanced market is typically considered to be 5-6 months. New York’s overall months supply rose to 3.3 months from 3.1 months last year. This is still a seller’s market, but it’s inching closer to balance.

Some counties are much tighter than others, while some are moving into more balanced territory. For example:

.  Tighter Markets (Lower Months Supply): Monroe (0.8 months), Erie (1.4 months), Nassau (3.1 months), Dutchess (3.9 months). These areas are still very competitive for buyers.
.  More Balanced Markets (Higher Months Supply): Columbia (4.9 months), Essex (6.2 months), Sullivan (8.0 months), Kings (8.4 months). These suggest a bit more breathing room for buyers, where homes might sit a little longer and negotiations are more common.
My conclusion: The New York housing market is vast and varied. What’s happening in Buffalo (Erie County) is quite different from what’s happening in New York City (Kings, Bronx, Richmond Counties) or in the scenic Hudson Valley. A savvy buyer or seller needs to look at the local numbers, not just the state averages.

Is New York Headed for a Buyer’s Real Estate Market?
Based on this report, no, not yet, at least not statewide. While sales are down and inventory is up, key indicators like median sales price still rising, days on market still being low, and the percentage of list price received still indicating sellers get more than asking, all point to a market that still favors sellers, albeit a little less dramatically than before.

However, the trend is leaning towards more balance. If inventory continues to grow at this pace and sales continue to dip, we could certainly see some local markets shift towards a buyer’s advantage within the next 6-12 months. It’s a slow burn, not a sudden flip.

What I’m Watching Closely
1. Interest Rates: These are the biggest wild card. Any significant drop (or hike!) would immediately impact buyer activity and seller willingness to move.
2. Job Market: A strong job market generally supports housing demand. If New York’s job growth slows down, so too might housing demand.
3. New Construction: The report shows new listings are up, but a big part of solving the inventory crunch long-term is new construction. Are builders putting up enough homes to truly meet demand, especially at more affordable price points? I always look at the pipeline for new supply.
4. Migration Patterns: Is New York seeing more people move in or out, and from where? This always influences local demand.

Conclusion: A Maturing Market, Not a Collapsing One
The May 2025 New York Housing Market Report paints a picture of a market that’s becoming more mature and perhaps a bit more normal after a period of extreme hyperactivity. The dip in sales is a natural consequence of high prices and higher interest rates. The rise in inventory is a healthy development, finally giving buyers more choice. Prices, however, continue their upward march, fueled by persistent demand and inflationary pressures.