Proving that the ultra-luxury real estate market still has some legs, wealthy home buyers are on a buying spree in New York City. Contracts signed for Manhattan properties priced above $20 million were up a whopping 140 percent year-over-year in Q1, according to a new report from Compass.
At the same time, pending sales increased overall by 9.3 percent in Q1 compared to Q4 and 1.7 percent year-over-year. More specifically, three- and four-bedroom apartments saw the most significant uptick in pending sales, increasing 10.4 percent and 19.2 percent, respectively, compared to last year.
Meanwhile, the number of closed sales fell 5.2 percent year-over-year and 13.7 percent for the first quarter. “Markets started to pick up in December 2023 as rates began to decline,” explained Compass agent Leonard Steinberg. “They have since inched up. This, combined with limited options and restrictive buyer wish lists, is cause for slow-to-close contracts.”
Overall, the average sales price in Manhattan clocked in at $1.88 million, down from the hefty $2 million average back in 2022. Per the report, the drop is due to a spike in co-ops, “which are 51.2 percent less expensive than condos, [and] represented 59.3% of sales, strongly signaling that most of the market is price sensitive.”
On the plus side, inventory has returned to levels not seen since 2019. There were 6,000 active listings in Q1, most of which were priced between $1 million and $3 million. There was also a 27.5 percent bump in new listings compared to the same period last year. However, that’s still a 4.9 percent year-over-year decrease. “These are encouraging signals as inventory rises in the spring buying season and more sales allow for more inventory,” the report notes.
So, what part of Manhattan is leading the way when it comes to performance? For one, the Upper East Side, as it would appear, has reemerged as a hot spot for property shoppers. The number of contracts signed increased by 15.5 percent over last year, while the median home price climbed 16.3 percent.
“After COVID, the great return to NYC showed us that buyers want neighborhoods that are well planned, well-seasoned, intentionally residential with tree-lined streets, comforting architecture, fantastic infrastructure, great shopping, easy transportation, and convenience to schools, parks, great hospitals, and cultural institutions,” added Compass broker Brian K. Lewis. “The Upper East Side has that in droves, and what’s old is new again.”
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