The first quarter 2020 housing price report is finally out, and this time the focus will be on the period after February, as the February-March data is generally said to be the indicator of the next year’s housing prices in New York. The direction of real estate in the beginning of spring can be inferred by observing February and March to a large extent.
If you are interested in reading last quarter’s report, please click on New York Manhattan Housing Price Report 2020 Q4
According to Streeteasy’s report, February 2021 was a record breaking month for closings, and compared to February 2020, we see the entire market moving more towards the buyer’s market.
Manhattan saw 1,304 properties enter into sales contracts in February, the highest in eight years and a 70.7% increase from February 2020.
Conversely, Manhattan home prices fell by 5% compared to February 2020.
While Manhattan real estate prices are still trending downward, the trend of discounting has slowed considerably and sellers are starting to discount less and less.
We are seeing a clearer understanding of the market among sellers and buyers, with initial price reductions and a more direct acceptance of buyers’ offers in bargaining rather than continued reductions in the market.
There were approximately 773 sales in Brooklyn in February, also very close to the record high of 774 for the same month last year, while home prices were down 5.5%.
Queens prices were unchanged, while volume rose by 31.4%.
In my opinion, there are several reasons for this surge in volume. On the one hand, buyers interested in New York City real estate are timing their entry, and on the other hand, many buyers want to buy while interest rates are still low.
While the number of sales is up dramatically, the market is still at a high point. qOctober 2020 is the highest point for NYC listings, and the current supply of listings is still well ahead of the demand, in other words, the market will remain a buyer’s market for a short time to come.
Finally, I also see a very interesting phenomenon in that the best locations in Queens and Brooklyn have seen the greatest volume growth (about 50%-100% growth). This means that buyers are making a balanced choice of location, price point, and future development. These are also the locations I have been recommending for the last 1-2 years, including Long Island City, Astoria, Downtown Brooklyn, Williamsburg, and other areas.
Last but not least, I have also attached the Streeteasy buying and selling and renting trend charts to show that the rental market is very similar to the sales market, but in my experience, when the housing market rebounds, the rental market rebounds much faster than sales.
For buyers interested in purchasing a home, I would recommend that they make their move in the next few months as the buyer’s market advantage diminishes as the listings deplete.
Conversely, for sellers considering selling, I would recommend aiming to list in May-August for a chance to sell before November when the market heats up.