New York City is a sellers market RIGHT NOW!
How long have you been waiting to hear that? Well don’t wait much longer now that you’ve been warned. Yes, warned. It is no surprise that the New York City real estate market has seen its fair share of activity in recent years–there’s the widening gap between supply and demand, ensuing bidding wars, and gaining market share of new construction deals. The last seven quarters has seen an uptick in overall sales, in line with the general upward trend we have been seeing in the last four or five years. The most notable part of that trend? While sales are still growing, the rate at which it is doing so is not like it has been in recent quarters. That being said, if you are looking to get a piece of the pie with your own property the most optimal time to get the largest piece possible is now.
The Big Picture (should be up for sale now)
Demand is still outpacing supply, and it does not look like it will abate soon. This is not just something we are seeing on one side of the price spectrum–both the lower and upper ends are seeing multiple offers and all-out bidding wars. This is especially characteristic on the lower end where listings below $1.6 million are receiving multiple offers and experiencing serious competition amongst potential buyers. If you are thinking about unloading a property in this range it isn’t a bad idea since the market is prime and closing above asking is very much probable.
On the other side of the spectrum, buyers are having to come to the negotiating table with pocketbooks larger than ever before. The third quarter of 2014 saw both a persistence of double-digit price growth, and a surge in home sales at or above the $10 million dollar mark. While this portion of the market is fairly niche it reflects the seller-friendly environment.
Eventually it gets crowded up top
Then again, the point is you want to sell now rather than wait. Although prices have been on the rise throughout all segments of the market, inventory is creeping in faster than it has in recent quarters and with that comes less competition per listing. What this slight attrition signals is a potentially less favorable market for sellers in the future. True that “less favorable” is relevant considering how hot the New York City market has been, but market analysis shows a real slowdown in the overall activity.
Due in part to new development, especially in the upper price range, properties are competing more and more for buyers’ attention these days. Buyers are being lured away from the prospect of dated listings or co-op board. New development deals often attract both foreign and local buyers with brand new–if not also high-end–finishes, fresh spaces, customizable elements, and modern aesthetics. For those buyers’ who have more financial wiggle room, new development deals do have their appeal.Typically, new condo purchases are local, if not at least domestic.
Friends “across all ponds
Over the years foreign dollars have ebbed and flowed into the New York City real estate market. On the higher end of the market foreign dollars have been saturating the pool of potential buyers. If your property falls in the higher echelon it is important to remember that this only means now is a time to sell–whether it’s local or foreign money, the money is there and ready to be spent now. For more affordable properties, foreign buyers are not as abundant which is again another reason to not wait!
Make gold, don’t sit on it
Outside of who will buy, also consider what you are selling. It is no secret that properties with the right amount of bedrooms, bathrooms, and square footage are topping out even above new development. Since inventory is lacking, preferred two-bedroom properties are quick to sell over one-bedroom or three-bedroom-plus listings. We have been seeing this preferential treatment strongest in the lower end of the market, but overall the desire for two-bedroom listings has been at a fever pitch for a while. That being said, even with no end in immediate sight the slowing of overall sales is a reality. Simply put, don’t wait to strike gold when you’re already sitting on it.
It is difficult to know for sure when the best time to sell is. Nevertheless, all indicators still point to a New York real estate market on fire. But every fire eventually burns out, and market analyses indicate that that is somewhere visible on the horizon. Don’t miss this sellers’ market: this New York minute is bound to pass.