First, let’s look at the overall U.S. housing market. New home sales fell 19%, since the pandemic boom that the rest of the country experienced back in 2020. [Reminder: NYC did not experience the same.] Yes, seasonality is part of this. But, rising mortgage rates are also causing buyer demand to decline.
As inflation continues to rise, raising interest rates is one way the Fed is looking to slow price increases overall. Lowering demand, lowers the cost of homes overall and gives people more spending power elsewhere.
Let’s take a look at what we’re seeing here in Manhattan:
This past week, supply actually ticked up by about 1%. If we’re looking back at the last “normal” year of 2019, this would be the time for supply to peak into the summer slowdown. Supply is still well below 2019 and 2021 levels, so it is too early to tell if this uptick is a trend.
https://www.urbandigs.com/dashboard/
While we see a small tick down on demand, it’s largely floating sideways in Manhattan and still above what we saw this time in 2019. Note that demand continues to be significantly above 2019, the last “normal year”. As a reminder, 2021 was an anomaly, i.e. blockbuster year.
https://www.urbandigs.com/dashboard/
Now, new listings last week saw a fairly large tick up. As we said earlier, this time of year we start to see the summer slowdown. This is a “wait and see” period as we watch for future supply trends.
https://www.urbandigs.com/dashboard/
Weekly new contracts are also up by about 1%. Again, as we head back into “normalcy”, 2019 is the best comparison year. As we approach the end of the first half of 2022, it continues to be a very strong year as buyers transact.
https://www.urbandigs.com/dashboard/
So, what does all this signal? Inventory pressure is easing as new listings come to market. The market is still head of average as contract volume continues to soak up supply.
The volatility of the stock market, rising interest rates and inflation have created a unique scenario that incentivize both sellers and buyers to take advantage of opportunities today. The future can never be predicted which suggests that it does not make sense to wait.
We’ll have to see what the market does as we head through the summer and into the fall. But right now, it looks like there may be some opportunity for buyers and sellers to strike a winning deal.
We’re always here to answer your questions and help guide you! Feel free to reach out anytime!
Recent Comments