Luxurious high-rise apartments are visible across Central Park South near Columbus Circle in the Manhattan borough of New York.
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Manhattan apartment sales fell 18% in the third quarter as rising mortgage rates and a falling stock market put the brakes on a New York real estate resurgence.
A report by Miller Samuel and Douglas Elliman says the decline is the first since 2020 and marks an upturn in the nation’s largest real estate market. The average Manhattan apartment price has risen 4% over the past year to $1.96 million, and while Big He’s Apple prices remain high, price gains are slowing and inventory of unsold homes is rising. It’s starting to increase.
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Manhattan sales declined 21% in Q4 2020.
“Manhattan’s boom has been interrupted,” said Jonathan Miller, CEO of Miller Samuel, an appraisal and research firm.
Brokers say the drop only marks a return to normal after artificially high sales in 2021. They said buyers and sellers were still active, and sellers Lower listing prices in response to rising mortgage rates. Average discount, or selling price compared to original list price, rose to 7% in the third quarter from 5.6% last year, according to Miller Samuel Did.
“Real sellers meet buyers,” said Compass’s Toni Haber.
Haber said he represents potential buyers who were considering the penthouse, which was originally priced at $14 million. She recommended presenting $9 million or her $10 million offer.
However, many brokers say sales are likely to fall further as the stock market decline and rising mortgage rates continue to hit.
According to a report by Brown Harris Stevens, “The full impact on sales and pricing will not be known until at least the next quarter. , which did not fully reflect the impact of rising interest rates.
According to Miller Samuel and Douglas Elliman, sales contracts signed in September were down 29% from a year ago. Sales in the fourth quarter are likely to be lower as well, as contract signings are indicative of future quarters.
The high end of the market shows the biggest drop. According to Coldwell Banker Warburg’s report, both his average discount rate and average number of days on the market increased for apartments priced at $10 million or more. According to the report, “the beautiful and large pre-war apartments along Park, Fifth Avenue and Central Park West that have become the dream of so many New Yorkers are now being sold to buyers for months and years. It is said that there are no people left.
According to Miller Samuel, contracts for luxury apartments priced above $4 million fell by 50% in September.
“The higher the price, the more bearish,” Miller said.
Miller said the high end of the real estate market is more “discretionary” because wealthy buyers and sellers typically have the freedom to decide when to buy or sell. Many sellers are holding off listing until the market improves. Meanwhile, a wealthy buyer sees the stock price drop more than 20% of his and is waiting for a similar drop in the real estate market.
“Among financial market volatility and rising interest rates, the highs are disappointing,” he said.