Embrace the arrival of autumn, and a warm welcome to September! In light of the evolving real estate scene, we’re dedicated to offering you an in-depth look at our primary markets: NYC, Westchester, and Miami. Join us as we explore the key highlights and developments that unfolded in these real estate markets throughout the month of August.
Across the nation, high interest rates are keeping prices elevated and inventory low. And, uncharacteristically, New York City isn’t a special case. New listings in August in Manhattan were down 59 percent from 2019 (the last year of “traditional” data not impacted by the pandemic-induced frenzy of the last few years), as shown in data collected by Miller Samuel for Douglas Elliman. In Brooklyn, new listings were down nearly 50 percent. In most cases, would-be sellers are holding on to their low-interest-rate mortgages and waiting to see what happens. For some, that’s the best choice right now. For those looking to make moves, we are seeing new inventory in small condominium complexes. According to Marketproof, buildings with 10 units or fewer comprise nearly half of New York City’s new housing right now, and that number is expected to continue to grow.
Despite tight inventory, newly signed contracts for Manhattan co-ops and condos experienced an increase in activity from July. The luxury market crawled through the month—including a mid-month slump that inked the fewest weekly deals since January—but gained momentum into Labor Day weekend when Manhattan experienced an exciting increase in transactions, including a deal for a condo at 432 Park Avenue that asked a peak price of $92 million. Sponsor sales at new developments made a notable splash during that week as well, accounting for 10 of the 17 homes asking $4 million or more to enter contract.
Most of the small condo developments adding inventory to NYC are concentrated in Brooklyn, where 133 are in the pipeline and 264 are already on the market. The borough’s luxury market started August on a low note, but activity showed more signs of life towards the month’s end. In the third week, 16 contracts were inked for luxury homes asking $2 million or more and in the last week, another 15 were signed. Despite new condo activity, townhouses still regularly topped Brookyln’s luxury reports. What’s interesting this month is their locale; homes in Bed-Stuy and Bensonhurst nabbed the top contracts in August.
In Westchester, August’s year-over-year decline in newly signed contracts still reflected the momentum of the pandemic-era housing boom despite rising mortgage rates. As the county continues to grow in popularity, the inventory remains in decline. Both factors have attributed to the 1.6 percent year-over-year growth of Westchester’s median sales price.
In the face of low activity, high interest rates and the resulting pricing disconnect between buyers and sellers, Miami-Dade county is still setting records. The median price of single-family homes and condos both grew 11 percent year-over-year and the total dollar volume of residential transactions reached $1.6 billion in July. According to The Real Deal, agents point to a lack of quality inventory as a key factor that’s keeping deal volume down and prices at a premium. A lack of newly built or renovated homes is driving some buyers to new developments. As a result, new condo developments at the very top of the market are reporting strong presales.
Higher interest rates have had an impact on even the most exclusive segment of the luxury housing market. In the 12 cities covered by the Knight Frank Global Super-Prime Intelligence report, there were 422 residential sales above US$10 million in Q2 2023, marking a 13% decrease compared to the same period the previous year. However, it’s worth noting that there was a notable increase in global sales during the 12-month period leading up to June of this year, with 1,638 sales, which is a significant improvement from the pre-pandemic sales levels, such as the 1,009 sales recorded in 2019.
Despite the year-on-year decline in overall sales, four specific markets experienced growth in sales volume, with Dubai leading the way with a 79% increase between Q2 2022 and Q2 2023, followed by Sydney (up 46%), Paris (up 17%), and Geneva (up 7%). Conversely, key US markets, notably Los Angeles, saw the most significant declines, with a 63% drop over the year.
In total, the sales for the 12 months leading up to June across all markets amounted to just under US$30 billion, which, while a decrease from the peak of US$40.7 billion seen in 2021, still significantly surpassed the pre-pandemic figure of US$18.6 billion in 2019.
Here at E|A, we’ve been frequently commuting between Miami, NYC, and Westchester, and we’re delighted to share that despite the data indicating a slower market, our team is experiencing a surge in activity with numerous new listings emerging after the Labor Day weekend. As ever, we remain dedicated to serving our clients in these primary markets and offering our expertise for those looking to navigate the real estate landscape in NYC, Westchester, or Miami.