Economic Outlook

Lower Hudson Valley Successes Fuel Rising Housing Prices, Stoking Demand


The recent economic trends in the Lower Hudson Valley will have far-reaching implications for the region’s future. A thriving job market, flourishing commercial real estate sector, and dynamic housing market support the foundation for continued economic growth and prosperity. However, challenges such as housing affordability and workforce development must be addressed to ensure that all residents benefit from the region’s success.

Policymakers will play a crucial role in addressing these challenges by implementing strategies to increase affordable housing options, investing in workforce development programs and supporting small businesses. Moreover, collaboration between the public and private sectors is essential to drive innovation and sustain economic growth.

One of the most promising aspects of the Lower Hudson Valley’s economy is its robust employment landscape. With diverse industries ranging from finance and healthcare to technology and tourism, the region has witnessed a steady rise in job opportunities. According to recent data from the New York State Department of Labor, the unemployment rate in the Lower Hudson Valley has plummeted to its lowest levels in over a decade, currently resting at between 3.5% to 4.0% for most counties in the area as of January 2024.

Westchester County, often considered the economic powerhouse of the region, has been at the forefront of the region’s employment surge. Major corporations such as PepsiCo, IBM, and Master- Card have established their headquarters here, contributing significantly to job creation. Additionally, the healthcare sector, led by esteemed institutions such as New York- Presbyterian Hospital and Montefiore Medical Center, continue to expand, offering a large number of employment opportunities in various medical specialties.

Rockland County, renowned for its manufacturing and biotech industries, has also witnessed a surge in employment. Companies like Pfizer and Novartis have established a significant presence in the region, fostering innovation and driving job growth. Further, the construction sector has experienced a boom, fueled by infrastructure projects and commercial developments across the county.

In Westchester County, the commercial real estate market remains robust, driven by its proximity to New York City and diverse industry sectors. The City of White Plains, in particular, serves as a focal point for business activity, boasting modern office spaces and vibrant retail centers. As of February 2024, the vacancy rate for Class A office space in Downtown White Plains stood at approximately 10%, reflecting a healthy level of occupancy despite challenges posed by remote work trends and changing office dynamics.

Additionally, areas like Yonkers and New Rochelle are experiencing revitalization efforts, attracting businesses with mixed-use developments and transit-oriented projects. The vacancy rates in these emerging submarkets vary, with industrial properties showing higher demand compared to office spaces.

Rockland County’s commercial real estate market is characterized by its diverse mix of industries, including manufacturing, biotech, and retail. The Nanuet area, situated along major transportation corridors, has emerged as a hotspot for retail and office developments. As of February 2024, the vacancy rates for retail spaces in Nanuet hover around 8%, indicating healthy occupancy levels despite evolving consumer preferences and e-commerce trends. Furthermore, the biotech sector in Rockland County has witnessed expansion, driving demand for laboratory and research facilities. The vacancy rates for specialized commercial properties in this sector remain relatively low, reflecting sustained interest from tenants and investors alike.

Putnam County’s commercial real estate market is experiencing a renaissance, fueled by its strategic location and growing demand for distribution and logistics facilities. Areas like Brewster and Carmel have seen an influx of industrial developments, catering to e-commerce and supply chain logistics. As of February 2024, vacancy rates for industrial properties in Putnam County stood at approximately 6%, underscoring the region’s attractiveness to businesses seeking affordable and accessible locations.

The housing market in the Lower Hudson Valley presents a dynamic landscape shaped by a balance between affordability and demand. As of March 2024, the region grapples with soaring property values and limited inventory, posing challenges for prospective homebuyers, while underscoring the desirability of the region’s residential offerings.

Westchester County, renowned for its affluent communities and sought-after neighborhoods, faces mounting pressure on its housing market. In localities like Scarsdale and Rye, property values have surged, with median home prices exceeding $1 million as of March 2024. Moreover, inventory shortages persist, with the number of available homes dwindling, contributing to intense competition among buyers.

Rockland County, while comparatively more affordable, has experienced similar housing market dynamics. In villages like Nyack and Piermont, waterfront properties command premium prices, with median home values surpassing $500,000 as of March 2024. However, the market also offers more moderatel- priced options, particularly in areas like Suffern and Spring Valley, where median home prices hover around $400,000.

Putnam County presents a more affordable alternative for homebuyers. In municipalities like Carmel and Mahopac, median home prices range from $300,000 to $400,000 as of March 2024, offering a compelling value proposition for those seeking a balance between affordability and quality of life.

In conclusion, the recent economic trends in the Lower Hudson Valley underscore the region’s resilience and potential for continued growth and prosperity. With a diverse economy, strategic investments in infrastructure and technology, and a commitment to environmental sustainability and workforce development, the region is well-positioned to navigate economic challenges ahead.

About the author: Michael J. Paton is a portfolio manager at Tocqueville Asset Management L.P. He can be reached at 212- 698-0800 or by email at MPaton@

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