The first quarter market reports are in, affirming a report released last week that found the resale market is strong throughout the city. “One of the key characteristics of this market was resales, which accounted for 84 percent of the market,” says Jonathan Miller, who crunches the numbers for Douglas Elliman’s report. “There was pent up demand pre-election ... and then we saw an uptick in resales, which was the biggest uptick in two years.”
The number of resales in Manhattan rose 7.7 percent from last year, to 2,429, while the median sales price of resale apartments remained unchanged at $950,000. This uptick caused the entire Manhattan market to pick up steam, with the number of total sales increasing .5 percent after falling year-over-year over the prior two quarters.
Miller believes one big reason the resale activity increased “is more about the seller coming down to meet the buyer, than the buyer coming up to meet the seller.” Case in point: listing discounts for all Manhattan sales was 4.2 percent, up from 2.1 percent last year. “It’s not high, but it doubled,” Miller says. “Sellers are coming down from over-priced listings to begin with.” A sign that buyers are willing to wait, also, is that the days listings spent on the market rose 16.1 percent from a year ago.
As for luxury inventory, it’s the same old story: Prices continued to decline and the overpriced luxury resale listings continued to flounder on the market before being removed, Douglas Elliman found. Although the median sales price for luxury listings—listings priced over $4 million—hit a record of $6,975,006 and median sales prices on new development increased 4.9 percent to $2,734,510, those numbers reflect older contracts that finally closed. These legacy contracts also caused two records to be set in the overall market: The price per square foot increased 3.8 percent to $1,778, and the average sales price rose 2.6 percent to $2,104,350.
As for Manhattan’s median sales price, it declined 3.3 percent to $1.1 million. The sales median for co-ops was $775,000, unchanged from last year. For condos, it was $1.65 million, a 10.6 percent decline from last year.
Halstead Property Development Marketing took a look at new Manhattan and Brooklyn developments this quarter, finding that 27 percent more units entered contract in Manhattan than the prior quarter, while Brooklyn experienced a 59 percent quarter-over-quarter increase. The average price for a new development unit entering contract was $2,219 per square foot in Manhattan and $1,361 per square foot in Brooklyn.
Stephen Kliegerman, president of Halstead Property Development Marketing, notes the “$5 million marketplace is doing well” when it comes to new developments. In Manhattan, the total percentage of new development deals entering contract under $5 million remained flat quarter-over-quarter at 72.4 percent, but fell year-over-year from 78.5 percent. “The number of units under $5 million are reducing, which means there will be a shortage of more reasonably priced [new development] units in Manhattan,” Kliegerman says. The percentage of deals over $5 million rose from 21.5 percent last year to 27.6 this year, given decreases in aspirational pricing at the top end of the market.
Corcoran also tracked a steady market pace, reporting that the number of signed contracts rose for the second quarter in a row, with this being the first year-over-year increase of contracts signed in six quarters. Pricing, however, remained flat and “sellers became more realistic this quarter,” according to the report. The median Manhattan sales price for the quarter was $1.134 million, Corcoran found. The median for a studio was $509,000, a one bedroom was $845,000, a two bedroom was $1.75 million, and a three bedroom was $4.137 million.
Finally, Compass provided some reasoning behind the increase in signed contracts: “With the election behind us, a surprising rally of the stock market, and interest rates on the rise, consumers are no longer holding out on purchases and sales,” the report says. The firm found that “attainable luxury” condos were in particular demand over the past quarter and also tracked strength in the Upper East Side co-op market that’s likely related to the Second Avenue Subway.
For all renters who feel left out, Apartment List happened to release its monthly rent report. No big surprises there, as NYC remains one of the most expensive cities for renters in the country, with a two-bedroom boasting a median rent of $4,100 and one bedrooms costing $3,200. Chelsea was the most expensive neighborhood for renters over the past month, with a two-bedroom costing $6,500 and a one-bedroom at $4,400. The West Village experienced the fastest-growing rents, at a 3.1 percent increase over last year. There, the median rent for a one-bedroom was $3,800.
- The Elliman Report: Manhattan Sales [Douglas Elliman]
- Corcoran's Q1 2017 Manhattan Market report [PDF] [Corcoran]
- Halstead Property Development Marketing New Development Report [PDF] [Halstead Property Development Marketing]
- Q1 2017 Compass Market Report [Compass]
- April 2017 New York City Rent Report [Apartment List]