The Pulse - Manhattan Luxury Market 9/24/24
Pulse
Pulse
Luxury Contracts Surge by 25%, While New Listings Fall by 11% in Manhattan’s Booming Fall Market! Welcome to this edition of the Pulse!
Contracts for properties priced at $4M and above surged by 25% last week, as the fall market kicks off into full gear. Meanwhile, new listings entering the market dropped by 11%, tightening supply and creating ideal conditions for sellers. Here’s what you need to know as the fall market continues to heat up:
In the $4M+ luxury sector, contracts increased by 25% last week, reflecting strong buyer demand. Even more encouraging, September is outperforming last year with a 48% rise in contracts compared to this time in 2023. This signals that the Manhattan luxury market is recovering from the lower-than-average contract volume seen earlier this year.
New listings fell by 11% last week, continuing the trend of reduced inventory, with a 10% year-over-year decrease in listings this September. Sellers benefit from this reduced inventory and a 48% increase in contract activity this September compared to last September, giving them more leverage in negotiations.
As usual, condos led the way, accounting for 64% of last week’s contracts. Downtown Manhattan remained the dominant neighborhood, with a 40% market share, followed closely by the Upper East Side at 32%. New development properties and the $10M+ luxury sector also performed well, each capturing a 20% share of the market.
The Market Pulse, which measures the balance between supply and demand, dipped slightly by 0.1 points from last month but rose 1.3 points compared to this time last year. It currently sits at 0.95, indicating a neutral market, though the tightening inventory may shift this balance in favor of sellers soon.
Out of the 25 contracts, seven saw discounts from the original asking price to the last asking price, with a modest median discount of 4%. This reflects that sellers are adjusting their pricing closer to market realities, helping properties move more efficiently.
The Fed surprised the market with a 50-basis-point rate cut, but since this move was widely anticipated, it didn’t immediately impact mortgage rates, which remain at 6.02%—a slight drop from the 7% range we saw earlier in the year. With another rate cut expected at the November meeting, buyers may benefit from more favorable borrowing conditions in the near future.
#1: 960 Fifth Avenue, Unit 12- prewar co-op
#2: 20 E 76th St, Unit 12A (The Surrey)
As the fall market kicks off into full gear, both sellers and buyers need to position themselves strategically. Sellers benefit from reduced inventory, a 48% increase in contract activity, and the trend of pricing closer to the market, which accelerates deals. However, precision pricing and property presentation remain critical in maximizing offers. Buyers should move quickly, taking advantage of stable prices and current mortgage rates before further tightening in inventory drives competition higher. The market is offering unique opportunities, but timing and strategy are key.
I represented a seller at 1049 Fifth Avenue, selling a 3-bedroom, 3.5-bath condo with a library and wrap-around terrace for $6.595M. A few years later, the buyer came to me for advice on reselling the property after making significant renovations. She expected a valuation of over $8M, but her updates, including the removal of the third bedroom, installing a canary yellow Viking range, and adding ornate, outdated fixtures, detracted from the property’s value instead of enhancing it.
I advised listing at $6.9M to test the market, but she chose another broker who listed it at $8.395M. After two years and two brokers, it finally sold for $5.85M—below what I could have secured had she followed my guidance. This case highlights the importance of making renovation choices that align with market preferences and ensuring pricing is in line with buyer expectations.
The fall market is gaining strength as it kicks off into full gear. Contracts are up, inventory is tightening, and sellers are adjusting their pricing strategies to reflect market conditions. It’s a crucial time for both sellers and buyers to act strategically. For more insights, watch my latest Manhattan real estate advice videos on YouTube. If you found this report valuable, feel free to share it, and as always, reach out with feedback, questions, or for expert advice on navigating the luxury real estate market. Email me here. Discover the perfect blend of luxury and comfort by exploring Carol Staab’s exquisite properties for sale, where your dream home awaits.
Until next week, may your real estate goals and dreams become a reality!
Carol Staab has an innovative luxury real estate practice that provides an elite level of concierge service through unparalleled world-class marketing and a hands-on business approach. Her mission is to give her clients an exceptional experience while helping them achieve the best results possible.