April 12, 2020 When you read the press coverage for Q1 2020, it’s critical to evaluate the stats with multiple grains of salt. We’re not in the midst of a real estate slowdown; in New York, we are near a standstill. Consider that this January’s sales were pretty close to January 2019 totals, and February 2020 volume was actually 10% higher this year, and the first week in March 2020 saw 8% more contracts signed year-over-year. Then came Covid-19.
Three weeks ago, I shared Manhattan Market Watch numbers for selected neighborhoods, and on the chart below I’ve compared the data for the weeks ending 3/20/20 and 4/10/20.
*Breakdown by neighborhood available
What do the numbers show?
It’s no surprise that there is downward pressure on the market from the last three weeks.
76% fewer Coming Soons
18% fewer New Listings
46% drop in Contracts Out + Signed Contracts
63% fewer Closings
60% fewer sellers have pulled their properties off the market
Properties priced below $3M saw the most activity, buoyed by reduced prices and low mortgage interest rates. For properties priced at $4M and above, this past week was the second consecutive week where only two contracts were signed. The last time only two contracts over $4M were signed in a single week was Christmas 2009.
What’s next?
This dark period will end, life will resume and markets will be restored. The news yesterday from Oxford University about the discovery of a vaccine with human trials beginning in the next two weeks is encouraging. We will emerge from this pandemic different in ways we can only guess at now. Notions of home, shelter and security will change.
“We are living through the biggest shift in the relationship between people and their homes since the 1950s when the American Dream of home ownership swept the nation…. Our homes have become everything to us,” says Robert Reffken, Compass CEO and Founder. When home takes on new meanings in our isolation, as we travel from our kitchens to the living rooms which serve simultaneously as virtual office, classroom, exercise studio, cook’s bay and quarantine quarters, apartment dwellers will reevaluate living spaces. Some buyers will trade amenities for more square footage. Proximity to parks will always be desirable and will increase property values. Outdoor balconies and terraces will offer homeowners much more than bragging rights. A flight to open spaces is entirely possible. Now that we’ve demonstrated we can work remotely, the second home market will heat up again. We’re already seeing an explosive doubling of values in rental properties in the areas surrounding NYC.
Like you, I’m staying home. Please stay healthy and be safe. I'm here for you.
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Shirley Hackel, NYRS®
shirley.hackel@compass.com | (914) 980-0371