Manhattan Property Market Update – by Weimin Tan –

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Posted by Wei Min Tan on April 19, 2024

Buy/sell, rent/lease residential &
commercials real estate properties.

The Manhattan property market is one of the most prized property markets in the world.  Our clients invest in Manhattan property for asset diversification and price stability.  Manhattan is a prime market where prices are high, appreciation is stable and rental yields are low but predictable.  Foreigners investing in Manhattan, New York property is a normal and daily event.  There are no additional stamp duties imposed on foreign buyers.

Unfortunately, the Manhattan market has experienced a big drop in sales volume since mid 2022 because of the Federal Reserve’s interest rate hikes to combat inflation.  The Fed’s rate hikes resulted in mortgage rates going to the 6 to 7 percent range when it used to be in the 3 percent range for many years.

Read Wei Min’s article: Foreigner Buying Property in New York, 8 Questions That Matter

Read about Wei Min’s style in Best Manhattan property agents and Role of a buyer’s broker.

Key points of this Manhattan Property Market Update

Sales volume:  In the condo market,  sales volume in Q1’2024 declined by 20 percent compared to prior year.  Low supply is a challenge because sellers would face higher mortgage rates if they sell and buy a new property.

Cash buyers:  The market share of cash buyers in Q1’2024 was at 63 percent.  This is because buyers needing financing are on hold while cash buyers came in to take advantage of the slow market.

Price per sqft and median price:  In the condo market, price per sqft is at $1,939 while median price at $1.632 million.  Price per sqft is lower than the peak in 2017 which was at $2,149.  Median price is still lower than 2017.  While sales volume has been low, prices have been very resilient.

Manhattan Condo Market’s Key Metrics

The most recent Q1’2024 data from Miller Samuel shows average price per square foot for a Manhattan condo at $1,939.  This is an 8.5 percent decrease compared to a year ago.  Number of sales was at 777, a 20.6 percent decrease from a year ago.  Median sales price was at $1.632 million, or 0.8 percent lower than a year ago.

Read Wei Min’s article: New York (Manhattan) Property Investing Strategies

Manhattan Condo Historical Price Trend

Data: Miller Samuel

The chart above shows the historical appreciation trend for Manhattan condos, with significant recession events circled in red.  Prices tend to appreciate over the long term, with dips during recessions.  Price per square foot was $480 in 1999, increasing to $1,939 in Q1’2024.

Prices at New Developments

New developments refer to buying a brand-new property from the developer.  These are usually sold 1–2 years before completion.  The buyer puts down a reservation deposit, waits for construction, and balance is due at eventual completion.  The average sales price of a new development was $3.25 million, 7.6 percent higher than a year ago.  Number of sales was 193, or 4 percent lower than a year ago.

Manhattan Rental Prices

The most recent February 2024 data shows average rental price at $4,985, or 3.9 percent lower compared to prior year as prices started stabilizing after more than a year of increases.  Number of new leases was 4,349 or 7.7 percent higher than a year ago.  Manhattan has perhaps the lowest residential vacancy rate in the U.S., at 2.49 percent.

Is now a buyer’s market or seller’s market?

We are currently in a neutral’s market as shown in the chart above.  The two most significant buyer’s markets were during the Lehman collapse in 2008/2009 and Covid, which hit Manhattan in early 2020.

Read Wei Min’s article: Buying property in New York to rent out

What We Do

We focus on global investors buying Manhattan condos for portfolio diversification and long term return-on-investment.
1) Identify the right buy based on objectives
2) Manage the buy process
3) Rent out the property
4) Manage tenants
5) Market the property at the eventual sale

This post was originally published on 3rd party site mentioned on the title of this site

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