Manhattan’s Reawakening
New York is alive and getting better. The change is palpable. Establishments have been reopening for business gradually. Restaurants, gyms, museums and movie theaters along with pedestrian and car traffic have returned. Hotel and airline bookings are up. In-person classes at public high schools are resuming this week. Vaccines are more readily available. Those who have been immunized are expanding their social circles, albeit tentatively. Yankee Stadium and Citifield will host the start of the baseball season with 20% fan capacity. Tourists are trickling back. Federal stimulus coins are jingling. Days are getting longer and warmer. And the spring selling season is well underway for New York City’s residential real estate market.
Optimism is snowballing, and activity is heating up. It’s been a market-wide recovery as the volume of transactions extends to all price points including the upper level which had been lethargic the longest. Pending sales market wide have been increasing at a steady clip weekly. Noah Rosenblatt of Urban Digs cites impressive stats for signed contracts last week at a level not seen since the highs of May 2013 and June 2015:
● Up 28.5% year to date
● Up 12% from last month
Similarly, there have been steady gains since August on contracts for new development condos with numbers climbing from 170 signed contracts to 456:
● Up 19.7% year to date
● Up 9.1% from last month
For the first time since November when inventory began trending downward, new listings last week ticked up, heralding positive news that a fresh supply of property choices would be available for anxious buyers.
To some, the turn in the market may feel sudden, but it did in fact take a year to get to this point. In brokerage offices around town, agents are being offered refresher zoom sessions on the ethics of handling multiple bids which are occurring with increasing frequency. Clearly, a release of pent-up demand is fueling the surge in the number of signed contracts. With limited tolerance for delayed gratification, New Yorkers are moving away from the sidelines and acting. Manhattan real estate is waking up; however, it’s important to acknowledge that for the most part, prices are firming but not accelerating. Values are adjusting to more attainable levels as sellers come down in price to meet the market buyers.
According to Rosenblatt’s analysis, 81% of the properties that went to contract last week had one or more price reductions.
The upswing in activity from buyers ought not to signal sellers to become more aggressive with pricing. Homeowners are advised to proceed with caution to protect how far we’ve come since last year’s lockdown. Mispricing a home today can be deadly.
2021 portends to be a more active year than any in recent memory. According to a Wall Street Journal survey of economists, experts are forecasting 5.95% economic growth, the fastest pace in 40 years. On the tailwinds of a roaring stock market, we’ll be moving into the second quarter with modest increases on historically low mortgage interest rates and more realistic sellers. As normalcy returns to life in NYC throughout the year, savvy buyers are investing in New York City real estate.
Shirley Hackel, NYRS®
shirley.hackel@compass.com | (914) 980-0371