The Hudson Valley housing market continues its steep upward trajectory, with median home prices surpassing $300,000 in every county for the first time, according to the latest annual housing report from Hudson Valley Pattern for Progress. The report, which examines data from 2019 to 2024, underscores how the region’s housing market has grown increasingly unaffordable due to a mix of pandemic-era migration, supply shortages, and shifting buyer demographics.
Pandemic-Fueled Demand Reshapes the Market
Since the onset of COVID-19, thousands of households from the New York City metro area have moved north, often purchasing homes above asking price. The influx of remote workers, coupled with sustained demand for second homes and short-term rentals, has significantly tightened inventory. Across the region, the number of home sales has dropped by 23 percent since 2019, even as prices have soared.
Westchester County became the first in the region to see its median home price exceed $700,000, while Sullivan County has witnessed the most dramatic percentage increase, with prices more than doubling over six years. The report notes that limited new construction has further exacerbated affordability challenges. Housing supply remains well below pre-pandemic levels, with most counties reporting less than half the number of homes for sale compared to 2019.
The Investor and Corporate Buyer Factor
While individual buyers—particularly those relocating from urban areas—have played a central role in driving prices upward, institutional investors have also contributed to the market squeeze. Although hard data remains elusive, Pattern for Progress suggests that corporate buyers are increasingly acquiring single-family homes to rent back to local residents. This trend has drawn scrutiny as it removes inventory from the traditional home-buying market, further straining affordability.
Climate Migration: A Growing Factor?
One emerging question is whether climate migration is playing a role in the Hudson Valley’s housing crunch. While the report does not provide specific data on climate refugees, real estate professionals and housing advocates have observed an increase in interest from homebuyers relocating from areas affected by natural disasters, including California’s wildfire-prone regions. The Hudson Valley’s relative climate stability and proximity to New York City make it an attractive destination for those seeking to escape increasingly volatile conditions elsewhere.
What’s Next for the Region?
The affordability crisis has broad implications, particularly for young families, low-income residents, and seniors looking to downsize. As home prices continue to rise, the region’s workforce faces growing barriers to homeownership, potentially exacerbating labor shortages in key industries.
Pattern for Progress warns that without significant investment in new housing development—particularly affordable and workforce housing—the market will remain out of reach for many longtime residents. Policymakers and housing advocates are closely watching how zoning laws, development incentives, and regional planning efforts might help address the ongoing affordability challenge.
With home prices showing no signs of slowing and inventory still constrained, the Hudson Valley’s housing market remains a high-stakes issue for residents and policymakers alike.
This article appears in February 2025.
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The lack of inventory is just one aspect of the affordability problem. Another factor is unreasonably high realtor commissions that are not rationally related to the limited services provided. Before there was Zillow or Realtor.com or any of the other multitude of online listing sites and before house prices increased 50% -200% in five years, realtor commissions at least seemed relatively commensurate with the value provided. Now, these fees are ludicrous. And despite the 2024 NAR settlement that required, among other things, that these fees be negotiable, in practice, they often are not.
In the past year, we’ve looked at hundreds of listings from Orange and Dutchess north to Sullivan county. Before the NAR settlement took effect in August, most of the listing agents were charging 5% and one upstate team was curiously listing homes with 6% fees. The fact that any realtor was charging 6% in 2024 is absurd. In 25 years of buying and selling homes in four northeast states and knowing countless others who have bought and sold houses, we have never heard of anyone actually paying 6%. But I digress.
5% (or worse, 6%) on a $700K bi-level (that sold for $280K in 2018) is unearned and unconscionable. After the NAR settlement took effect, when buyers were required to sign buyer representation agreements, most of the buyer agents we spoke with were still asking for 2.5%, though two agents we spoke to were asking for 2%, which is still too high. And there was at least one upstate team curiously still demanding a 3% buyer fee. The agent from that team did “discount” the fee to 2.5% because she hadn’t shown us the house (we saw it an open house), but she thought that 2.5% was fair given the expertise she would be bringing to the table. She hadn’t seen the house herself (but said it was impeccable) and could not provide us with any comps or offer any guidance re: value in that market (because it turned out she worked for the same team as the seller’s agent). When we asked what she was providing for the 2.5%, she said she would take the pulse on inspection issues. When we told her we thought 1.5% was a more reasonable fee for drafting an offer and taking pulses, she told us the fee is what it is. So, not negotiable.
Much more work needs to be done to make housing more affordable in the Hudson Valley. Demanding lower fees from realtors should be one of the easier steps.