More apartments in New York sold during Q3 2021 than at any other time in more than 30 years.
New York Housing Market Recovering at Faster-Than-Expected Pace
In a new report by the Douglas Elliman brokerage authored by Jonathan J. Miller, president of Miller Samuels Appraiser, more apartments were sold in Manhattan during Q3 2021 than at any other time in the last 32 years.
Q3 2021 ended with more than three times as many closed sales of co-ops and condominiums as Q3 2020 (during the pandemic lockdown) and +76.5% more sales than in Q3 2019, pre-pandemic.
Miller said, “What we’re seeing right now is a catch-up. All the suburbs were booming while Manhattan was seeing sales at half the normal rate last year. Now we’re seeing this massive surge.”
“The Fire Sale is Long-Since Over.”
Findings in this latest Douglas Elliman report are consistent with findings from other companies. According to the brokerage Corcoran, sales volume topped +$9.5B, the most in any recorded quarter. The firm of Brown Harris Stevens reported the highest quarterly sales numbers in eight years.
Gregory Heym, chief economist with Brown Harris Stevens, said, “The fire sale is long-since gone.”
Heym was referring to sale price discounts buyers received during much of 2020 due to a serious glut in luxury inventory. “Fire sale” discounts were almost required to sell off some of that inventory. Even with those “fire sale” discounts, the pace of sales in Q3 2020 was the second-worst pace in over two decades.
Instead, during Q3 2021, there was just 5.1 months of supply, less than the 10-year average of 7.2 months, and Q3 2021’s pace of sales was lightening fast. Miller said, “I think we have a couple quarters ahead of us with a very brisk pace.”
Current Market Specifics in Manhattan
Manhattan’s median sales price in Q3 2021 was $1,115,000, an increase of +1.4% y/y and an increase of +88% from the same time two years ago in 2019. Miller indicated that one-bedroom co-ops and condos, had a median sales price tag of $800,000, an increase of +3.6% y/y. (One-bedroom condos and co-ops represent the largest share of sales in Manhattan’s market.)
Competition is again tightening up. Brown Harris Stevens reported that sellers of existing co-ops and condos lowered their most recently asking prices an average of -2.6%, the smallest discount in nearly four years.
Miller reported that bidding wars are returning as are all-cash sales. All-cash sales, which had formerly dropped to a seven-year low of 39.3% at the beginning of 2021, now reflect the market’s longtime average of approximately 48.6% of all sales.
Manhattan Market Not Yet Fully Recovered
The market imbalance in Manhattan is now supply weighted. Historically, there are approximately 17% more active listings than over the 10-year average for any third quarter.
Market “iffy-ness” now centers around buyer demand. With plans to return to the office being delayed and the unknown of how many workers will return to a five day/week commuting schedule, no one “knows for sure” whether or not Q3 2021’s sales pace will continue into Q4 2021 and 2022.
Thanks to Douglas Elliman, Brown Stevens, Harris, and The New York Times.