Summer Isn’t What It Used To Be
Twenty years ago the Manhattan real estate sales market slowed to a crawl every summer. Not so today! The red hot rental market is hotter than ever, with inventory remaining at record lows, and the sales market in most areas and price points is steaming as well. Here’s what my agents have told me this week about activity in the current marketplace:
* First, and of greatest importance, it is ALL about the price. Price it right and you are in the game. Price it wrong, even by a little, and you are on the sidelines.
* All over town, from Harlem to the Financial District, new condos are hot for both American and foreign buyers. Inventory is way down, and buyer frustration levels are up. They either think the market is about to go down because of global economic pressures, or they can’t believe they missed the boat after reading so much about excess inventory. Meanwhile, these properties at all price ranges keep moving out the door, often with multiple bids.
* Reasonably priced larger apartments on the Upper West Side are scarce and in demand. A recent open house for a fully renovated 4 bedroom property on West 110th Street brought in 35 buyers, several of whom made on the spot offers. The same story is being heard all over the neighborhood. There is so little in the mid-priced 6 room to 8 room market that these units sell in a week or less.
* Smaller apartments are also hot. The combination of high rents and low interest rates has opened the floodgates for small apartment buyers (many of whom are parents buying for their kids). Here too, well priced units, especially in the better locations, sell in no time with multiple offers.
* Brownstone Brooklyn is the hottest part of town. Many Warburg customers have bid the asking price only to discover two, three or four bidders going higher. At least two of our customers lost four competitive bidding situations before finally snagging a house.
* Condition counts. My agents observe that mint apartments are a much quicker sale. Owners who cannot be realistic about the condition of their properties when pricing tend to see their properties linger on the market.
* In the market above $3 million, it needs to sell fast to sell well. The backlog of pent-up demand makes new listings very popular during their first few weeks on the market. Once that backlog of buyers has seen the property, showings tend to dwindle to one or two a week at best. So it is critical to price to sell during the first crucial weeks. If you lower your price after the first month, the best buyers have already seen and rejected the property. And although they liked it, once they have rejected it they usually don’t come back, even at a lower price. Psychologically, they have already moved on.
July and August may bring some easing from the fast pace of June. But for now, with the weather still cool as July approaches, we are busy and delighted so to be. Summer is not what it used to be, and that is fine with us.