NEW YORK, Aug. 12, 2020 /PRNewswire/ -- A flood of new homes went up for sale in New York City in July, but other indicators — including pending sales and off-market price negotiations — show the city's sales market in the midst of a major slowdown, according to StreetEasy's July Market Reportsi.
Citywide, the total number of homes for sale in July was 6% lower than last year. But following the Phase 2 reopening of most real estate activity in NYC, a record high 2,714 new listings came onto the market in Manhattan. That's an 87% increase over July of last year — a surge in inventory akin to what's typically seen at the start of home-shopping season in April.
Yet while sellers have begun to return to the market, July data shows that many of them are not meeting the price points buyers have in mind.
This July, 37% fewer Manhattan homes went into contract than in the same month last year. For those homes that did change hands, the difference between what sellers offered in discounts and what buyers actually paid reveals a market that is still adjusting to a new reality.
Only 14.5% of Manhattan sellers offered a discount in July, at a median discount of 5.2%. But the homes that went on to close after off-market negotiations sold for a median of 10%, or $117,000, less than their initial asking price. This difference between initial ask and final closing price is the largest ever recorded by StreetEasy, going back to January 2010.
"COVID-19 has exacerbated the weakness in the Manhattan sales market. If the sellers that have returned to the market are serious about making a sale, they will have to lower their prices accordingly," says StreetEasy Economist Nancy Wu.
"Very few homes on the market are getting significant price cuts, even though the small pool of successful sellers are accepting offers well below their initial asking price," Wu says. "Once this reality sets in, asking prices will inevitably begin to mirror what we're already seeing in off-market negotiations."
See below for additional sales and rental market trends across Manhattan, Brooklyn, and Queens.
Post-Pandemic, Manhattan Homes Linger on the Market
Manhattan pricesii fell 4.2% year-over-year to $1,450,000. Prices dropped the most in the Upper West Sideiii submarket, declining 5.8%. The median asking price of $1,499,000 was the lowest recorded since 2014. Homes lingered on the market for a median of 144 days — 68 days longer than last year.
Brooklyn Prices Drop Amid Record New Inventory
Brooklyn prices fell 2.1% year-over-year to $969,000. Brooklyn sellers accepted offers at a median of 8%, or $62,400, less than their initial asking price — the largest difference on record. Sellers added 1,724 new listings to the market — a 50.3% increase over last year, and a record high for the borough.
Queens Prices Rose, But Buyers Still Negotiated
Home prices in Queens bucked the citywide trend, rising by 1%. The median asking price in the borough was $650,000. Homes sold over a week faster (9 days) than last July, remaining on the market for 61 days. Similar to Manhattan and Brooklyn, Queens homes closed for record discounts compared to initial asking prices, with sellers accepting offers 6.3%, or $32,287, lower than their initial asking price.
View all StreetEasy Market Reports for Manhattan, Brooklyn, and Queens, with additional neighborhood data and graphics. Definitions of StreetEasy's metrics and monthly data from each report can be explored and downloaded via the StreetEasy Data Dashboard.
StreetEasy is reimagining the way people buy, sell, and rent homes in New York City and New Jersey. Used more than any other local real estate platform, StreetEasy's website and mobile apps provide vetted and verified listings, plus intuitive search tools and data-driven guides to help people unlock the opportunity of living here. Consumers and real estate professionals can stay up-to-date on the latest real estate trends through StreetEasy's Market Reports and explore and download market data for free on the StreetEasy Data Dashboard. Launched in 2006 and based in NoMad, Manhattan, StreetEasy is owned and operated by Zillow Group (NASDAQ: Z and ZG) and is a registered trademark of Zillow, Inc.
iThe StreetEasy Market Reports are a monthly overview of the Manhattan, Brooklyn and Queens sales and rental markets. Every three months, a quarterly analysis is published. The report data is aggregated from public recorded sales and listings data from real estate brokerages that provide comprehensive coverage of Manhattan, Brooklyn and Queens, with more than a decade of history for most metrics. The reports are compiled by the StreetEasy Research team. For more information, visit https://streeteasy.com/blog/research/market-reports. StreetEasy tracks data for all five boroughs within New York City, but currently only produces reports for Manhattan, Brooklyn and Queens.
iiThe StreetEasy Price Indices track changes in resale prices of condo, co-op, and townhouse units. Each index uses a repeat-sales method of comparing the sales prices of the same properties since January 1995 in Manhattan and January 2007 in Brooklyn and Queens. Given this methodology, each index accurately captures the change in home prices by controlling for the varying composition of homes sold in a given month. Levels of the StreetEasy Price Indices reflect average values of homes on the market. Data on the sale of homes is sourced from the New York City Department of Finance. Full methodology here.
iiiThe Upper West Side submarket includes Lincoln Square, Upper West Side, Manhattan Valley and Morningside Heights