"2021's first quarter was the strongest start to any year for Manhattan signed contracts since 2007, giving buyers and sellers a much-needed shot of confidence that the market has finally turned a corner. The perfect storm of lower prices and higher inventory brought buyers out in force during 1Q. With few exceptions, there was great value available across every product type, bedroom count, and neighborhood.
Favorable pricing, coupled with historically low-interest rates, is also causing savvy renters to make their move to homeownership. Today, they can secure a Manhattan home at a price that may have been unthinkable a few years ago. With the spring market upon us, these dream conditions for buyers won't last forever – I advise home seekers to seize the moment, or risk regret down the road." – Pam Liebman
For the first time since March 2020, real estate transactions have exceeded those of the same period last year. More than 50 sales were closed by Brokers in the first quarter of 2021 than they did in 2020. And 1,500 Manhattan homes were under contract for sale in March, which is the highest monthly number in the past 14 years, according to UrbanDigs, an NYC-based real estate market data company.
There may have been fewer super-luxe transactions; however, the median sales price was more expensive than it was during the first quarter of last year, typically going for about $1,075,000, up 1.4% from the $1,060,000 median price in the previous year, according to Douglas Elliman. Also, within this data, we are seeing sellers are giving fewer discounts. About 4.6% compared to 7.2% during March 2020. Condo and Co-op sales were up almost 700%, given that the market completely shut down during March 2020, new listings are only up 20% currently.
Real estate inventory is 18.2% higher than it was last year, providing a supply estimated to last through the end of the year, so prospective buyers, don't worry, you haven't missed the boat.
Before the pandemic, there wasn't a massive range of buyers. However, the reset in prices is now attracting buyers that were priced out previously. First-time buyers made up 41.9% of sales which is the highest share in at least seven years. And the percentage of all-cash buyers fell to 39.3% due to the buyers taking advantage of low mortgage rates. The current falling prices have also attracted more out-of-state buyers at about 10-15% compared to 3% last year.
Combining the spring homebuying season with pandemic recovery, it is predicted that the market is about to accelerate as we continue through this season. Finally, the market is poised for a revival and looking up.