NYC Real Estate - January 2023
Nishant Sondhi
Real Estate Investment Fund Manager | Specialized in Passive Investing for Multifamily & New Developments | Data-Savvy, Transparent, Committed
Greetings, and I hope you are well.
Manhattan Overview:?
January 2023 was a slow month for the Manhattan real estate market. There were 1,153 new listings in January, a decrease of 21% compared to the same period last year.?
The number of deals signed in January was 597, which is lower than the typical figure of 765 deals during this time. However, this number is expected to increase as the busy season approaches.?
The market is starting to shift from a slowdown to a resurgence in activity.
Why do 'Days on the Market' matter for a listing?
According to John Walkup, co-founder of real estate data site UrbanDigs, time can be detrimental to negotiations in real estate.?
He studied the impact of prolonged listing duration on pricing and found that?discounts increase by approximately 2 to 2.5 percent every 30 days?until 6 months on the market. After that, there is a sharp increase in discounts with a rise of 3.5 and almost 5 percent for each subsequent 30-day period.
?Mortgage rates drop to the 5% range for the first time since September 2022
?Buyers have reason to be optimistic as mortgage rates continue to decline. According to Mortgage News Daily, the average rate on a 30-year fixed mortgage is now?5.99%.
Mortgage rates peaked in October 2022 with the 30-year fixed at 7.37% and have been sliding since then.?
Mortgage rates have decreased since November of 2022, following a trend of climbing most of the year due to the Federal Reserve's interest rate hikes aimed at controlling inflation.?This downward trend is supported by evidence suggesting that inflation may have reached its maximum level.
领英推荐
Advice
For Sellers:??
On the positive side, the market does not appear to be experiencing further declines, and prices have only fallen 5-7% from their peak levels the mid-last year. However, liquidity remains low, and the start of the active market season is expected to be slow. Although inventory may be tight now, it is predicted to increase in the next 3-4 months.?The best time to list a property is in February and March to secure a sale within the first 30 days of listing.?It's important to plan for potential price reductions during peak months.
For Buyers:?
The real estate market has shifted, and you now have leverage in negotiations. Anxiety levels seem lower than in late autumn, and there is clear evidence that the market is recovering. Although fresh listings are currently higher than transactions, causing a perception that the market is losing momentum, this trend is typical for this time of year. It is expected to change in the coming months. Prices are only down by around 5-7% from their peak levels, and some sellers are still reluctant to offer lower prices.?Approach negotiations wisely, and remember?that this market has no excessive frenzy.?
Have questions about NYC market?forecasts, trends, or anything else real estate-related? I'd love to connect - please email us at [email protected]
If you would be?interested in investing in Multifamily properties?across emerging markets in the U.S. that generate cash flow and have value add opportunities - please email us at [email protected]
Data Source: UrbanDigs, Yahoo Finance
The Sondhi Team:?Nishant is a Real Estate salesperson in Manhattan and Brooklyn and the Founder of the Sondhi Team, and his team specializes in Residential Real Estate. He is passionate about helping buyers and sellers navigate the New York market, save them thousands of dollars, time and make the process enjoyable. His strong analytical, marketing, and negotiation skills developed during his MBA and over 10 years of sales experience give him a unique edge to best serve his clients.