The first quarter of 2018 is writing the tale of two coasts as each relates to the housing industry. New Yorkers are walking away from over zealously priced digs while they come to grips with the nation’s state of uncertainty and the 2017 Tax Law. Californians, on the other hand, appear to be wearing blinders.
The two-three years of aspirational housing prices in New York City appear to be drawing to a close. More than 52% of all contracts closed in Q1 2018 for less than list prices according to Miller Samuels. This is the biggest drop in pricing since 2009. Buyers seem obsessed with not wanting to” overpay.”
Additionally, sales activity in New York City in Q1 2018 experienced the biggest annual drop since 2009. Totaled together, the number of condominium and co-op sales dropped by -25% according to Douglas Elliman Real Estate and Miller Samuels. Sales of new condos dropped an eye-popping -54% and condo re-sales were down -18%. Interestingly enough, the re-sale co-op market increased +2% according to Corcoran Real Estate.
San Francisco and San Jose, as they have in recent years, continue to lead the pack in terms of price jumps and home valuations. The median price of a home in San Francisco in Q1 2018 hit $1.6M, a new high. San Jose, considered the hottest market in the country by Zillow, came in with a median price of $1.128,300. Simultaneously, home price appreciation in booming tech towns serves as “…a kind of second job equivalent in wealth of a six figure annual salary to homeowners who have already or are close to paying off their mortgage…” said Aaron Terrazas, the senior economist with Zillow.
Check out this Home Price Appreciation List, courtesy of Zillow and assuming an 8-hour workday:
City Value Per Hour Per Day Per Year
US $210,20 $7.09 $56.72 $14,800
San Fran $1.6M $99.81 $798.48 $208,303
San Jose $1.28M $60.31 $481.04 $125.494
Seattle $740,700 $54.24 $433.92 $113,199
NYC $721,100 $42.17 $337.36 $ 88,009
Oakland $755,600 $38.57 $308.56 $ 80,496
San Diego $618,200 $30.86 $246.88 $ 64,405
LA $671,000 $26.35 $210.80 $ 54,992
Long Beach $583,000 $18.64 $149.12 $ 38,902
Honolulu $702,100 $17.44 $139.52 $ 36,397
Boston $569,500 $16.91 $135.28 $ 35,129