Shelter Island house prices continue to rise: Factors determining the increase

It’s not news that the price of a house on Shelter Island has tracked in only one direction over the past 10 years. We asked Town Assessor Judith Lechmanski exactly how steep was the climb, and she provided us with some numbers (see chart below).

In 2013, the median home sale price on the Island was $723,000. As of June this year, the median price was $1,075,000.

For all of 2023, the price tag for a buyer was $1,150,000.

Ms. Lechmanski said it was more accurate to use the median — the middle number in a group of figures — rather than the average. She noted that the average number, when it comes to real estate prices, can give a skewed perception.

Ms. Lechmanski cited the example that in the batch of 2024 Shelter Island numbers there was a sale for $3,000,000, and one for a tiny lot for $2,500, both of which would be thrown into the average calculations.

Shelter Island’s median price numbers are significantly higher than Suffolk County and New York state. According to data collected by Rocket Homes, in September of this year, the Suffolk median home sale price was $615,234, up 11% from the previous year. And in the state, the median price was $853,828.

Nationwide, the median price in March was $412,00, according to data from Reddit.

Twice in 11 years, home sale prices dropped year-to-year on Shelter Island. In 2015, according to the Town Assessor’s Office, it cost $709,750 to buy a house; the previous year the price was $70,000 more. And in 2022, the price was $1,500,00, when a year later the median home price was $1,150,000.

According to the finance and business journalist Ana Teresa Sola writing for CNBC, inflation has been the main culprit in driving up the prices of homes, but also playing a part are the twin economic factors of supply and demand for goods and services that’s steering prices to higher ground.

Matt Brannon, a journalist who specializes in personal finance and real estate topics, has written on the topic, noting that, “When demand for other consumer products comes up, or when it increases, it’s usually not too hard for people to scale up supply. Whereas houses take months at a time to build.”

That’s borne out by U.S. Census data that the average time to build a single-family house in the U.S. is 9.6 months.

Another reason for a demand is the Island itself, with its natural beauty, low taxes and laid-back charm. In addition, wealthy folks can find, if they’re looking to settle on the East End, that they can find reasonably priced properties compared to the Hamptons.

MEDIAN HOME SALE PRICES FOR SHELTER ISLAND

2013 — $723,000

2014 — $780,000

2015 — $709,750

2016 — $811,750

2017 — $835,000

2018 — $850,000

2019 — $870,000

2020 — $1,047,500

2021 — $1,175,000

2022 — $1,500,00

2023 — $1,150,000

2024 (as of June) — $1,075,000

Source: Assessor’s Office, Town of Shelter Island