June Market Update
We, at the LevinKong Team, hope that you are safe, well, and enjoying the beginning of the season. Summer is upon us, and New Yorkers are out and about taking advantage of some of their favorite activities. Restaurants, entertainment venues, rooftops, parks, beaches, and all the perks that our beloved city has to offer are all back in full swing.
With vaccination rates up, businesses brimming with activity, and offices reopening, the city’s real estate market came back to life this spring. We experienced a more than doubling of sales volume from the prior spring, which proved to be the busiest since the spring of 2015. This activity was not equal across all neighborhoods and market segments but signaled the start of a strong market ahead. The downturn that we experienced was primarily caused by the pandemic, and not underlying real estate fundamentals. In early 2020, we had the start of a recovery, punctuated by events outside of the real estate market; it proved to have been delayed, but not derailed.
In general, we are seeing real estate in major cities across the world experience an incredible resurgence. New York is no exception. The Brooklyn market took off earlier and is more competitive in general, but Manhattan is no slouch. Spurred initially by discounts, backlogged demand came roaring back. Even with high sales volume and tightening inventory, prices are only up approximately 5% year-over-year.
We do expect to see more upward momentum in pricing this fall. Before that occurs, buyers can certainly take advantage of a seasonal slowdown this summer. Inventory that has been lingering should become more vulnerable, as many buyers change their focus to summer activities and travel.
While the discounts and concessions in the new development market are lessening, there is still opportunity to take advantage of higher inventory levels in that segment. This is especially true as we move up in price. While the luxury market is brimming with activity across the city, higher priced new construction units are still seeing the greatest discounting and potential for future upside.
With proper guidance, there are many ways to take advantage of this dynamic and intricate market. More than ever, a data-driven, research-based approach rooted in decades of experience, will equip our clients to thrive in this environment. Enjoy your summer and please let us know if we can answer any questions you may have about the market, or how best to navigate complicated decisions.