Sure the trophy property market is soft, but the other headlines are sensational so far…
Like this one from Sept 21 in Business Insider:
While that headline may be technically true, deeper down we read this:
Homeowners cut prices on 774 properties, more than the record of 713 set in March 2009, StreetEasy said. That represented nearly 5% of all homes, which was the highest since February 2009. StreetEasy started tracking the data when it was founded in 2006.
I don’t know about you, but reading about price cuts on 5% of homes on the market doesn’t seem too much to get worked up about yet?
Maybe it’s higher than during the hot years, but it seems like there’s a long way to go yet before the middle market in NYC is taking the sorts of hits we’re seeing in Seattle.
But it’s definitely “on the way” as they say. Inventory is climbing, and prices have moderated a bit:
Total real estate sales in Manhattan fell 11 percent in the third quarter compared with a year ago, marking the fourth straight quarter of double-digit declines, according to new data from Douglas Elliman Real Estate and Miller Samuel Real Estate Appraisers & Consultants. It was also the first time since the financial crisis that resales of existing apartments fell for four straight quarters.
Prices fell, inventory jumped and discounts were higher and more common. Real estate brokers say the Manhattan real estate market is suffering from an oversupply of luxury units, a decline in foreign buyers and changes in the tax law that make it more expensive to own property in high-tax states.
“We’re in reset mode, and I think we still have a little way to go,” said Jonathan Miller, CEO of Miller Samuel. “It’s way too early to think about the market seeing significant improvement.”
The average price of a Manhattan apartment fell 4 percent during the quarter, to $1.93 million, while the median price fell 5 percent over the last year to $1.1 million. There is now a seven-month supply of apartments, up from five months in the third quarter of 2017.
So, yeah, in Manhattan things are soft and getting softer. Is it a Melbourne style price free-fall? Not yet…but getting there.