{August Market Update} Is this a good time to buy?
Welcome to Fall! Sorry for the lateness of this month’s letter but I was clinging to the last bit of summer. Now back to work! The NYC real estate market is slower this summer with 6% less transactions compared to last summer (June, July and August). Prices are down a decent amount: new construction is probably down 20% from the peak levels in 2015 with many downtown projects asking around $2000/sqft versus the $2500/sqft back then. Combined with resale, the overall market price is down 5% from 2017. And this metric tells why: Absorption Rate (a measure of inventory level) increases from 5.8 months just a year ago to 8.7 months today. The market is over supplied now. The down cycle has been orderly. There was never a screeching halt – the powerful combination of slightly fewer buyers every month and the abundance of new construction supply gradually got us here over the last 3 years.
What is it like to be a buyer now? You have plenty of options. You could make an offer and a seller will engage you. The negotiations might even surprise you with how much leverage you have. Naturally there is always the nagging question of whether this market is going down further. Possibly. But buyers, the power lies with you!
A Good Buy
After almost half a million in price reductions, you can have this large 2 bedroom in prime NoMad with views in every direction for 2.75mm or $1700/sqft. Like this one here.
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The NYC real estate market was the tale of two cities in October. Total transaction volume ticked higher, even though rates moved higher and sentiment was tense. Most of our new clients were understandably quiet. But quite a few of our repeat clients, the real estate veterans, were busy putting deals together.