Six Long Island communities where home prices rose more than 15%

From Great Neck to Middle Island, potential buyers watching home prices on Long Island during the first half of the year tended to see them move in one direction — up.

That was the case through the end of June, when the median price for single-family homes, condos and co-ops in the second quarter increased 11.7% from the previous year to a record $670,000 on the Island, according to real estate brokerage Douglas Elliman and the Manhattan appraisal firm Miller Samuel. The data excludes sales in the Hamptons and the North Fork, which Miller Samuel reports separately.

The rapid run-up in prices continues the trend since the pandemic as too many buyers chase too few houses. 

“Inventory is beginning to climb in the second half of 2024, but it’s still skewing to historically low levels,” said Jonathan Miller, CEO of Miller Samuel, which provided Newsday with data on home prices across nearly 200 communities on Long Island. “As a result, we saw record prices.”

That dynamic was certainly at play in six areas that saw some of the fastest price growth on Long Island. In Nassau County, Great Neck, Manhasset and Franklin Square saw prices rise the fastest among areas where there were at least 50 sales from January to June compared with the same stretch a year ago.

The median price in Great Neck rose more than 35% from the previous year.

In Suffolk, East Patchogue, Amityville and Middle Island led all communities with enough sales to qualify. 

But it wasn’t just those areas. Fast-rising prices prevailed across the Island in the first half of the year.

Among communities where there were at least 50 sales in the January to June period, 73 of 76 had a higher median price during the first half of the year compared with the same time frame a year ago. Most of those areas had at least a 10% year-over-year increase in the median price of a home.

Listings started to increase slightly in August compared with last year in Suffolk but ticked a bit lower in Nassau compared with a year ago, according to OneKey MLS. Still, the number of homes for sale was less than half what it was in August 2019 before the pandemic started. 

Nassau County is bucking the national trend of more houses hitting the market, said Odeta Kushi, deputy chief economist at First American Financial Corp., a provider of title insurance and settlement services.

She said that’s due in part to the so-called lock-in effect, in which homeowners stay put rather than give up the ultra-low mortgage rates available a few years ago.

“If you have a market already with a shortage of inventory, not a ton of building and demand for those properties, that’s a recipe for further price appreciation,” she said.

First American recently released a report showing an improving picture for affordability nationwide because of declines in the 30-year fixed mortgage rate. The average rate fell from nearly 7% in July to 6.32% as of the week ending Oct. 10, according to mortgage giant Freddie Mac. 

If mortgage rates fall further, it will benefit Long Island homebuyers, knocking hundreds of dollars off their monthly mortgage payments. But it may not be enough to help buyers.

“If there’s more buyers that come off the sidelines and not enough sellers and homes to meet that demand, it could actually result in a reacceleration in prices, and, all else equal, hurt affordability,” Kushi said.

Miller said the housing market could remain distorted for years to come — at least until an unforeseen economic downturn saps homebuyer demand. 

“That’s the challenge facing the region — housing affordability — and I just think it’s going to take five, 10 years, if not more, to to get through this distortion,” Miller said.

Below are six of the areas where home prices climbed the fastest in the first half of the year.

Median price first half of 2024: $930,000

Median price first half of 2023: $685,000

Change: 35.8%

Great Neck saw the fastest increase in prices of all areas with at least 50 sales. But much of that steep rise can be attributed to the change in the mix of properties that sold in the area.

Home sales data for Great Neck, as collected by Miller Samuel, include deals in all the villages and unincorporated areas on the Great Neck peninsula, from the mansions on Long Island Sound in Kings Point to the studios in co-op buildings in Great Neck Plaza near the Long Island Rail Road station.

In the first half of this year, the number of co-ops that sold was basically flat, but there was an almost 30% increase in the number of single-family houses that sold in Great Neck, boosting the median price. The opposite scenario occurred last year, when a surge in co-op sales pulled the median price lower.

“One of the challenges in tracking this market is the influence the mix of sales have on the end…