New York by the Numbers
Dear Friends and Family,
As we kick off the second half of the year, I want to take an important look at the market. As real estate often comes hand-in-hand with major life changes, there can be a lot of emotions involved in a transaction. But as the market fluctuates, it can be important to take a step back and look at the numbers and what they indicate. See my insights below or take a look at the full 2022 Q2 Manhattan Market Report.
Manhattan Market - Recorded Sales
Q2 and the entire first half of 2022 saw record breaking numbers. Sales volume for the first six month topped $15.6B, the highest in over 10 years, and Q2 sales volume rose 18.6% year-over-year. The median and average sales prices also rose year-over-year to $1.245M and $2.1M, respectively or about a 10% increase for both.
Manhattan Market - Contracts Signed
Looking at contracts that are signed but will close later this year, the rush to buy, and seller-driven negotiations (or lack thereof) are slowed. 24.6% less contracts were signed in Q2 compared to last year. Prices remained somewhat elevated for contracts signed but this is expected to change with rising interest rates and a 16.3% surge in new inventory quarter-over-quarter.
Manhattan Market - Luxury ($4M+)
These trends in contracts signed are also reflected in the luxury market, which is considered stable when there are an average of over 20 contracts signed over $4M per week.
In 2021, especially Q1 and Q2, many weeks averaged over 30 luxury contracts signed. Looking at this year, an average 15-25 contracts per week shows that the market is still steady but the rush to buy last year has been slowed.
NYC Rents
The mayoral-appointed Rent Guidelines Board has approved a 2%-4% rent increase for one-year leases and 4%-6% for two-year leases for rent-stabilized apartments. After considering increases up to 9%, this decision comes as a direct confrontation to inflation and concerns of recession. The news has mixed responses from landlords and tenants alike who saw 0%-1% increases for many years under the DeBlasio appointed board.
National Market Concerns
Many people are questioning if an oncoming recession would resemble 2007-2008. The answer is probably not! Here are a few key indicators why not:
New lending regulations and guidelines have lead to borrowers' average credit score rising from 699 in 2010 to 751 today — a much firmer footing
Tappable equity hit a record high of $11 trillion collectively this year, a 34% increase from 2021.
Mortgage debt in the US is now less than 43% of current home values, the lowest on record.
About 8% of active mortgages are adjustable-rate compared to 36% in 2007 before the the market crash.
About 1/10th the number of ARM borrowers are facing rate increases this year compared to 2007.
Mortgage delinquencies are now at a record low, with just under 3% of mortgages past due.
The market is constantly changing and more than my job as an advisor, it is my passion to stay on top of the data for myself and my clients. If you or anyone you know has any questions about the market right now or what it means to buy/sell/rent today versus tomorrow, please don't hesitate to reach out to see how me and my team can be of assistance.
All the best,
Toni Haber
Licensed Associate Real Estate Broker
Founder, Toni Haber Team | Private Client Advisors
TONI@compass.com | 917.543.1999
