Despite overall economic conditions in the region low mortgage interest rates continued to sustain housing activity in various housing markets throughout the region. Through the second quarter of 2003 the region continued to record employment losses but at a slower rate than in the previous year. Total nonfarm employment in New York State declined by 80,000 jobs, or 1 percent, in the 12 months ending June 2003. More than half of the losses were in manufacturing, primarily in the durable goods sector. Employment losses continued in professional and business services and in the information sector, each with more than 20,000 jobs lost, as well as the financial activities sector, where 15,000 jobs were lost.
During the 12 months ending June 2003 average nonfarm employment in New York City declined by 75,000 jobs. Employment losses were recorded in various sectors including professional, business, and information services and financial activities. Many Upstate New York market areas continued to register employment losses. During the 12-month period job losses ranged from 0.2 percent in Buffalo to 2.2 percent in Rochester. Employment levels remain stable in the Albany-Schenectady-Troy area and moderate gains were recorded in the Syracuse and Utica-Rome areas.
In New Jersey nonfarm employment has been relatively stable. Compared with year-earlier figures employment declined by approximately 2,000 jobs. Job losses in the manufacturing and information sectors were partially offset by increased employment in education, health services, and retail trade.
As of June 2003 the unemployment rate in New York State was 6.1 percent, unchanged from June 2002. The unemployment rate in New York City was 8.1 percent, up from 7.9 percent a year earlier. The rate in New Jersey declined to 5.7 percent, down 0.2 percentage point from a year ago.
Despite decreased economic activity the sales market in most Upstate New York housing market areas has remained surprisingly strong. According to the Buffalo-Niagara Association of REALTORS® demand was concentrated in the $120,000 to $130,000 price range, and the market for homes priced above $400,000 is soft.
The weak economy continues to affect the New York City real estate market. Demand for less expensive studio and one-bedroom condominium and co-op apartments in Manhattan continues to be strong, but sales of larger, more expensive housing remains soft. Recently there have been some signs of increased sales activity, even at the high end of the market.
In the first 6 months of 2003 residential building permit activity in the New York/New Jersey region totaled 36,751 units, a 3-percent decline compared with the same 6 months in 2002. The change was mostly attributed to the reduction in single-family activity in both states. Through the second quarter of 2003 single-family permit activity in the region declined by approximately 2,000 units, or 9 percent. Multifamily activity in the region increased 6 percent to 15,948 units.
Based on preliminary statistics the New York State Association of REALTORS® reports that sales for the 12 months ending June 2003 decreased 11 percent to 8,163 homes. During the period the statewide median sales price of an existing single-family home increased 18.5 percent to $196,750. In a number of market areas the decline in sales is partly the result of shrinking inventory of homes for sale.
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