Key Highlights

  • Q2 sales numbers down -54% from last year
  • Median sales price down -17.7% from last year
  • Number of signed contracts for apartments down -76% compared to last year.

From every vantage point, the COVID pandemic has walloped the New York City housing market. According to a new report from the brokerage Douglas Elliman… 

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  • Closed sales dropped -54% in Q2 2020 compared to Q2 2019
  • Median sales price fell -17.7% compared to Q2 2019 to $1M, the largest drop in 10 years
  • Number of signed contracts for apartments fell a whopping -76% in Q2 2020 compared to Q2 2019

Jonathan Miller, president of Miller Samuel and author of this latest report, said, “This is what you get when the market is not able to function.” In-person apartment viewings were banned in NYC for almost the entirety of Q2. Miller added, “It’s an extreme moment, to put it lightly.”

The market situation is actually worse than these numbers represent because more than 90% of the sales recorded in Q2 were signed before the COVID outbreak brought the city to a standstill.

Despite this abrupt halt, some professionals believe that pent-up demand from buyers unable to see apartments in-person before the city began re-opening will spur sales in Q3. And apparently, according to Urban Digs, 550 new listings, nearly twice the number of new listings compared to last year at this time, just hit the market. Even with that strong listings uptick representing seller optimism, listings in Manhattan are still shy -26% from last year, according to the Corcoran Group.

Another huge unknown on top of realistic demand and pricing is buyer preferences. Will the new development market get more interest from buyers wanting new, never-before-lived-in properties? Will buyers “get over” their apprehensions about shared elevator spaces and shared lobbies? Will buyers continue their increased searches for apartments with outdoor spaces and home offices?

And will the share of all-cash buyers, down to 41% from an average of 50% over the last several years, according to Miller Samuel, return? If yes, good news for the luxury market that has been bolstered by investment buyers. If no…well, take it from there.

Garrett Derderian, chief executive with GS Data Services, speculates that the market may return to some iteration of normal by Q1 2021. However, Derderian is hedging his bets by saying that some iteration of normal depends upon two things…whether or not NYC experiences another wave of infections and whether or not the state raises income taxes to compensate for pandemic-related budget deficits.

Thanks to The New York Times.

Also read: What’s Going On In Luxury Markets?, Top Major Metros Increasing & Decreasing in Foreclosure Starts, Where Is Most and Least Affordable?

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