NYC Real Estate April Market Update

As an investor, you ask: should I put my money in real estate or the stock market?  The graph above shows the annual appreciation rate for Manhattan submarkets from 1995-2018.  Add on 2-3% of rent yield, NYC real estate as an investment instrument yields 7-9% per year.  Compared to the 8-10% annual returns of the stock market, an investment in real estate is safer (less volatility), requires less involvement but also less liquid.  Companies (stocks) are managed more actively, with more investment on improvement and innovation.  Real estate owners tend not to invest as much into their properties.  However, real estate benefits from the intrinsic growth of population. 
 
The April NYC real estate market kept up the good pace we saw in March.  Median Sales Price of 1.2mm has been the same since January.  Days on Market shortened to 65 days, a major improvement from January.  922 listings went into contract in April, a healthy number by any measure; 572 deals closed in April, about 100 more than this time last year.  In terms of $ per square foot, March’s $1445/sqft bucked the downward trend that started in October 2017.  April recovered even more to $1503/sqft.  This could be due to the larger transaction volume on the luxury end valued at $4mm and above.  New development sponsors were more willing to cut deals to move their inventory.  According to the Olshan Report, the market saw a steady stream of luxury homes go into contract in March and April.  Sellers continue to put out homes for sale.  March inventory level recorded a high of 7.4 months.