Bidding wars drive Long Island home prices to record $750,000 in third quarter

Long Island home prices jumped to a record level in the third quarter, as an all-time high 60% of homes sold for above sellers' asking prices, signaling bidding wars continue to frustrate buyers.

The median sale price on Long Island, excluding the East End, climbed 7.1% to $750,000 during the July-to-September period compared with that same stretch a year ago, according to a report released Thursday by real estate brokerage Douglas Elliman and appraisal firm Miller Samuel. The firms report Hamptons and North Fork prices separately.

Record highs have become the norm on Long Island, as buyers outnumber willing home sellers. The third quarter marked the sixth quarter in a row in which prices reached a new high.

The number of listings has yet to recover from the post-pandemic period when a wave of buyers capitalizing on rock-bottom interest rates depleted available listings. Homeowners continue to resist putting their properties on the market, agents say, as they balk at giving up a low mortgage rate to buy at today's record prices.

By one measure, buyers’ willingness to pay more for homes has never been stronger. Among all sales that closed during the third quarter, a record 60.5% of buyers paid above the sellers’ last asking price, the data showed.

That’s the highest since the firms began tracking the metric in 2017, surpassing the previous high of 59.2% in the second quarter of 2022.

“I’ve been in the business for 28 years, and I’ve never seen anything like a run like this,” said Todd Bourgard, Douglas Elliman’s CEO for Long Island, the Hamptons and North Fork.

Share of closed sales above sellers' last asking price

Q3 2019          24.9%

Q3 2025          60.5%

Six in 10 buyers paid above asking price in the third quarter of this year. Before the pandemic, only about 25% paid above list price. 

Bidding wars persist

Since 2021, it has been common for half of all sales in a given quarter to command more than a seller’s list price.

But that wasn’t always the case. In the third quarter of 2019, before the COVID-19 pandemic kicked off a real estate boom on Long Island, only about 25% of sellers received more than their asking prices.

One reason, Bourgard said, is it's far more common than it was before the pandemic to price a home near its expected market value to entice buyers. Sellers less frequently set an aspirational asking price with the hope of meeting buyers in the middle.

Several other data points confirm just how competitive homebuying on Long Island has become, said Jonathan Miller, CEO of Miller Samuel. Average days on the market between the original list date and when buyers agreed to a contract fell to 37 days in the third quarter compared with a year ago.

“Properties are on the market for a shorter period of time and more people are fighting through bidding wars that are now at record levels of more than 6 out of 10 buyers paying more than the asking price for their homes,” Miller said. “That is the definition of a tight market.”

Homebuyers must compete because of the shortage of homes on the market. There were 4,889 homes for sale at the end of September on Long Island, excluding the East End, which was down nearly 5% compared with a year ago. That figure hit an all-time low last December.

There are fewer than half as many homes on the market as there were in 2019, when there were more than 13,000 listings.

“It’s going in the wrong direction in the long-term sense,” Miller said.

However, sellers should be careful not to overplay their hand, said Mustafa Uruk, a real estate agent at Exit Realty Island Elite in Port Jefferson Station.

Sellers and their agents should use recent sales of homes in their area of a similar size and condition to determine a price, he said. If they ask for much more, their home could sit on the market for weeks, and that’s when buyers try to negotiate on pricing or contract terms, he said.

“They’re going to start lowballing you after the second week on the market because you haven’t been able to attract many people,” he said.

Uruk said he recently worked with a buyer who offered more than $70,000 above a seller’s asking price of about $600,000 to get an accepted offer in West Babylon.

“That wouldn’t happen in every town, in every situation,” Uruk said. “But [the seller] did the pricing just right too — under the market value to bring so many buyers to get aggressive.” 

Liz Byrne, a broker at Harms Real Estate in Rockville Centre, said she’s surprised the share of homes sold for above asking price was so high in the third quarter, but she’s seen the lack of listings drive prices higher in the village, where the median price was $968,500 among sales that closed during the first six months of the year.

“We still have the surge of buyers but we don’t have the inventory,” Byrne said.

It’s important to note that sales that closed between July and September may have been agreed to in the late spring or early summer. Later in the summer, Byrne said, there was a lull in buyer activity.

Buyers “are starting to get discouraged,” she said. “They’re not reacting as quickly as they had been.”

Miller, the appraiser, isn’t optimistic buyers will have better luck in 2026. Mortgage rates have started to fall toward 6%, and while that could coax more homeowners to sell their properties, prices tend to rise as mortgage rates fall. That’s because more buyers can afford to purchase and they gain greater buying power.

“If mortgage rates continue to drift lower, housing prices are going to continue to rise,” Miller said.