Q4 Manhattan Market Report
Q4 At a Glance.
There has been a lot of buzz about tax reform and specifically how it will effect the NYC real estate market. While it is difficult to forecast now where it will drive pricing, the caps on both mortgage and state + local tax deductions will certainly play a role in buyer decision making moving forward.
Sales: Fourth quarter closed sales were very close to the same as last year. Signed contracts decreased by 14% year over year, mainly in response to the tax reform that convoluted buyer decision making. Inventory increased by 9% and growth among smaller, less expensive properties was counterbalanced by faster absorption. Larger properties at higher prices were selling more slowly and lingering on the market. Activity varied widely by product type:
- Resale Co-ops: 4% increase as more availability of lower priced inventory and lower price points relative to resale condos contributed to demand.
- Resale Condos: 3% decrease in closed sales, the fewest closings in any fourth quarter since 2011.
- New Development: 12% decrease although this decline is more of a reflection of the timing of the current building cycle and completions. With that said, high prices and lessened interest in pre-sales have somewhat lessoned overall demand.
Pricing: The median price rose by 5% to $1.067M. Average sale price declined for the second quarter in a row, falling 7% annually to $1.879M. Median price per square foot was flat to last year at $1,344 while the average price per square foot decreased by 8% to $1,695, which was very much affected by fewer and less expensive new development closings.
For an extremely in depth fourth quarter analysis, check out The Corcoran Report 4Q17
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