The NYC real estate market is on the move again as seasonal liquidity returns, indicating the onset of the active spring season. With this shift, both buyers and sellers are poised to experience changing dynamics. Let’s delve deeper into what these developments mean for you.
Understanding Recent Trends
Throughout 2023, we witnessed a gradual decline in contract activity, a cooling off in the listing climate, and a modest dip of about 10% in prices when compared to the peak we experienced in the spring of 2023. All the while, supply has remained somewhat constrained.
But remember, this is a bit like looking in the rearview mirror – it reflects past market conditions. The big question now is whether prices are poised for a rebound from their lows.
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Adjusting Expectations
Buyers should note that peak leverage appears to be behind us. The market is in the early stages of demonstrating a more neutral state, where neither buyers nor sellers hold a distinct advantage.
The below chart shows an interesting statistic that Urban Digs refers to as the Climate Index.
It’s a ratio of signed deals (what sold) compared to listings removed from the market (what did not sell). By definition, a low number reflects a more challenging environment for sellers.
Sellers take note! Even though the market has been quite difficult for most of the last two years, zoom in on March. The historical data shows that we could be on the cusp of a robust listing environment. Only time will tell.
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Sellers: Seize the Seasonal Momentum
If you find yourself thinking about selling, it’s time to gear up for the bustling spring season. Despite the dips in prices, we’ve seen throughout 2023, based on historical trends and recent sales data, there are reasons to be optimistic. While inventory might be tight right now, we’re expecting new listings to pick up noticeably over the next few months.
Having said that, price your property to reflect current market conditions and trust that this is the most important step to achieving a signed contract. Overprice, and your property will sit. While the market does feel like it is turning a corner to the positive, it is important to remember that we are coming out of a strong buyer’s market.
Still, the upcoming conditions spell some of the best opportunities for sellers since last spring. The sellers who come to market priced well out of the gate are the ones who capture that very important first wave of buyer momentum and, therefore, are the most likely to be successful.
Buyers: Navigate Shifting Dynamics
While the seller’s advantage might be tapering off, buyers are still in a pretty good spot, price-wise, compared to last year. Negotiability with realistic sellers can still happen. It is important to keep in mind that the landscape we are seeing is evolving more toward increased competition and slowly chipping away at that negotiability power.
The best apartments and those that are move-in ready are likely to start going into contract very quickly. As always is the case, it is important to work with an agent who can help you make informed decisions so that you can reach your goals.
Please feel free to reach out with any questions. We are available for a deeper discussion if real estate is on your mind.
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