It’s as if the turbulent changes in Manhattan’s real estate market during the pandemic never happened.
The Manhattan condo-buying frenzy kicked off in 2021 as the city bounced back from the worst of the pandemic. However, it fell sharply at the end of 2022, with lower sales and lower prices returning the market to its pre-pandemic trajectory. The only outlier is that inventory realization is still slow.
The average price of all Manhattan apartments in the fourth quarter was $1,100,500, down 5.5% from a year earlier, according to a report by brokers Douglas Elliman and Miller Samuel Real Estate Appraisers and Consultants. It is the first time in the pandemic era that prices have fallen year-on-year. Still, average apartment prices are above pre-pandemic prices.
Prices fell 4.7% between the third and fourth quarters as home loan rates actually spiked, according to Freddie Mac, ending with an average of 7.08% for 30-year fixed-rate loans in October and November. reached.
The largest share of condos sold was one bedroom with a median price of $1,140,000. The average price for a two-bedroom condo was $2,150,000. The average co-op prices were low at $710,000 for one bedroom and $1,325,000 for two bedrooms.
Rising interest rates and still-high home prices cooled demand at the end of last year, driving sales down. Fourth quarter sales decreased 28.5% compared to the fourth quarter of 2021.
The significant decline in sales at the end of 2022 is largely due to the historic anomaly of the previous year.
Jonathan Miller, president and CEO of Miller Samuel, said:
Another reason for the slowdown is the lack of apartments on the market, he added.
Home-sellers across the country have purchased or refinanced ultra-low-rate mortgages in the past few years, so they’re trapped in their current apartments and reluctant to buy at today’s much higher interest rates.
As a result, Manhattan had 6,523 listings at the end of the fourth quarter. This is 5% higher than he was in Q4 2021, but 15.7% lower than he was in Q3 2022.
“The numbers are essentially working as if the pandemic never happened,” Miller said.
Market indicators of prices, sales and inventories show that both prices and sales are rising at a moderate pace from pre-pandemic levels, with prices up 10% and sales up 6% from 2019 levels. I’m here.
But inventories are down about 2%, which is odd, says Miller.
“It’s an extraordinary situation where inventories are low as a result of mortgage rates being cut to their lowest levels,” Miller said, undermining supply. “Usually, inventories are expected to expand at a significant growth rate.”
Looking ahead, neither buyers nor sellers should expect much from the market. Miller has called 2023 his “year of disappointment.”
“Sellers won’t get the prices they got in 2021, and buyers won’t see much improvement in affordability from 2022,” he said. I am disappointed as it is.”