From My Desk To Yours
Yesterday’s NY Times front page story “Possible Boom Post-Pandemic” recognizes an economic sea change. We are turning the pandemic corner, and for that we are grateful. Economists are predicting a supercharged rebound for the U.S. Days ago, in a February 18th report issued in Washington D.C., Fannie Mae Sr. VP and Chief Economist Doug Duncan predicted a 6.7% GDP increase this year, simultaneously cautioning that the same reasons for expansion might also push up inflation. “Growth,” he noted, “will accelerate sharply beginning in the second quarter.” The news bodes well for residential real estate in New York.
We have passed the market’s bottom, moving cautiously into a more balanced marketplace. As spring beckons, buyer negotiating leverage is diminishing. But the narrative is more than just about moving from nothing to something. We’ve progressed from lockdown to real activity, and the upswing has been dramatic. Consider the following:
● This year saw the strongest start for signed contracts in 7 years with more than 900 contracts signed in the first 4 weeks of 2021, a 28% increase YOY.
● Only 55 of those contracts were for properties asking $5+M but that was 49% more than January 2020.
● So far this month, we’ve seen the strongest 3-week period for contracts signed for properties asking $4+M since the last week of April and first two weeks of May 2015. According to Donna Olshan’s survey, 104 contracts have been signed since February 1st this year.
● There’s been a dramatic uptick in contracts signed with developers. Week over week, pending sales at new developments have continued to improve with only a modest trickling of foreign buyer interest. In the last 30 days, 129 new dev contracts were signed: 49 at $2M and below; 47 at $2+M-$5M, and 31 above $5M.
● More first-time buyers are coming into the market. In the last 30 days, 548 contracts were signed for $1M and under in Manhattan; 463 contracts were signed during the same time and price category in Brooklyn.
In the last several weeks, there’s also been plenty of anecdotal evidence to herald a strong spring.
● It’s getting harder to book appointments. At Open Houses which are typically run every 15 minutes by appointment, some buyers are getting shut out.
● Multiple bidding has returned for well-priced properties.
● Dozens of emails are circulating weekly in the brokerage community from agents in search of specific properties for their buyers.
Now is a great time to take action on either side of the trade. If you'd like to take a deeper dive into the data, let's set a time for a virtual coffee to talk specifics. ☕️