The Conclusion to a Record Year

I publish these updates at the end of each quarter or when there is something noteworthy to share. We have just concluded the busiest year on record for Manhattan real estate.?Some highlights:

• Over 16,600 contracts signed in 2021, the largest amount ever;
• Nearly 4,200 contracts signed in the fourth quarter of 2021, also the largest amount ever; and
• The very high number of luxury sales (with a price over $4 million), double the 2019 pre-pandemic level.

I have been writing about how busy the market has been for the last year or so, but each time noting that prices haven’t really gone up much despite the high level of activity. This quarter we have finally started to see price increases.?Average price per square foot is up about 5% year over year. Median apartment prices are up 9% over last year as larger units and condos represent a larger share of the market. This is actually the first quarter in five years that Manhattan prices have gone up across the board.

Looking ahead to 2022, I am expecting the market to remain busy and prices to continue to increase.?The high levels of inventory for sale have been the primary reason prices had not been moving much. Despite many new listings this quarter, the strong sales numbers are starting to make a dent in inventory levels. There are still lots of apartments for sale, but there are 37% fewer than this time last year and 8% fewer over the past three months. This bodes well for the continued strength of the market.

It is always possible of course that unexpected developments like large interest rate hikes, stock market declines or new virus variants can throw a monkey wrench into the marketplace. For the moment though, what I am seeing is a very healthy market benefitting from a good year on Wall Street, affordable interest rates and a sense that this newest variant may prove to be one of the last acts of the pandemic.

If you would like to discuss any of this, or if there is anything I can do for you, please feel free to reach out.?You can follow me here on?LinkedIn or on?Facebook?and?Instagram?for my latest thoughts on developments in the NYC real estate market.?