Manhattan real estate deals on a downard slope

Business | 3 Oct 2018 12:27 pm

In the three months through September, property purchases in Manhattan in the US dropped by 11 percent from a year earlier to 2,987 -- the fourth straight quarter with a decline, according to a report Tuesday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.

Listings piled on to the market at an even greater rate, climbing by 13 percent to 6,925 homes, the most for a third quarter since 2011, Bloomberg reports.

"It is somewhat perplexing,” said Garrett Derderian, director of data and reporting for brokerage Stribling & Associates, which also released a report on Manhattan home sales Tuesday. "The financial markets are quite strong. Mortgage rates, while rising, are still at historic lows. But the perception has become that the market is overheating in terms of pricing. No one obviously wants to come in at the top where they’re paying the highest prices as things are going down.”

Stribling reported the weakest third quarter for Manhattan since the collapse of Lehman Brothers Holdings Inc. a decade ago froze the property market. The 2,212 signed contracts -- a measure of pending sales -- were the lowest for the period since 2008, while inventory was the highest since then.

Buyers who came around to a deal in the quarter demanded discounts, bringing the median price of completed purchases down 4.5 percent from a year earlier to US$1.12 million, Miller Samuel and Douglas Elliman said. In 54 percent of sales, buyers paid less than what sellers were seeking. An additional 37 percent of transactions closed at the asking price, but often that figure had already been reduced.

Brown Harris Stevens, in a joint report with Halstead, said previously owned Manhattan homes spent an average of 104 days on the market in the third quarter, compared with 94 days a year earlier. Average co-op prices fell for almost all apartment sizes, with three-bedrooms seeing the biggest decline at 17 percent, to $3.13 million.

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