Homes in Manhattan that sold in February sat on the market for the longest amount of time since 2012, according to a new Bloomberg article. The data cited in the article shows that sellers in the market are not lowering prices quickly enough to meet the demand of buyers.
Properties had been listed for a median of 117 days before finally going under contract, which was up from 90 days a year earlier, according to a new analysis by StreetEasy Manhattan. Home sellers wound up shaving a median of 4.6% off of their asking prices as a result. These types of discounts will continue to get deeper if sellers are looking to close sales in a market that, right now, is "crowded with choices" according to the report.
The index of Manhattan home values, which is compiled using closed purchases, was down 4.3% from February 2018 - a change that is "eyebrow raising" according to Grant Long, senior economist at StreetEasy.
“With a strong economy and home-shopping season right around the corner, plenty of New Yorkers are well-positioned to buy this spring. However, many are willing to walk away from deals that just aren’t financially attractive and continue renting instead — creating a market poised to punish sellers who don’t price their homes sensibly. When the inevitable wave of new inventory hits the market this spring, interested buyers should expect to see an uptick in price cuts as the market forces ambitious sellers to accept reality.”
He also expects inventory, which is up 12% from last year, to reach a record this spring, telegraphing even tougher times for sellers in the year ahead.
Recall, we reported in early January that the 2018 trend of tumbling Manhattan home prices was continuing into the new year.
After declining for most of 2018, the median sales price for Manhattan apartments slipped again in the fourth quarter of 2018, with the price moving below $1 million for the first time in three years, as brokers and sellers were forced to offer more significant discounts and perks amid a flood of inventory for sale, according to Bloomberg.
Condo and co-op prices declined to $999,000 in the three months through December, a drop of 5.8% from a year earlier, appraiser Miller Samuel and brokerage Douglas Elliman said in a report back in January. Many apartments were sold for less than sellers originally sought, with an average discount of 6.2% from the last list price. That is up from price cuts of 5.4% a year earlier.