The Manhattan real estate market is experiencing a phase of significant recovery. The indicators are offering mixed results but show us how the post-pandemic awakening is at an advanced stage. Although the inventory is still a lot, sales activity has grown and the “covid discount” effect is already waning. Reading these data, it should be remembered that these indices are somehow still influenced by the pandemic as they reflect the difference between this quarter and the same period last year.
Talking by Numbers. Let’s try to put things in perspective:
There were 3,417 closed sales, up +151.8% from the year-ago quarter. The most significant jump in sales activity since tracking the metric began in 1990, a very encouraging signal and an indication of newfound market activity mentioned before. Before the pandemic this would have increased 15.6% when comparing the second quarter of 2019 to 2021.
Another sign of upturn of transactions is the rise of the median sales price, up 13% YoY to $1,130,000, the highest level reached since the record was set at $1,215,000 in the same quarter of 2019. At the same time, the average sales price was up 2,1% at $1,921,204. Numbers were slightly skewed by the tendency to buy more spacious properties during last year’s lockdown.
The average price per square foot was $1,548, down -5.7% from $1,642 of 12 months ago. But this figure, unlike the median price and the average price, tends to be less affected by rapid changes in the sales activity.
Now let’s analyze an interesting fact, during this quarter the resales comprised 90% of all sales, and their average price per square foot declined -3.6%, which is a reasonable proxy for a “COVID discount” range of 3% to 5%. However, in the first quarter, this metric fell -9% for a range of 7% to 10% suggesting the discount window during the pandemic era is compressing.
With the number of sales rising faster than listing inventory, the pace of the market speeds up with months of supply rate fell – 50% from the prior-year quarter to 6.9 months, while days on the market was 169, 36.3% longer than the previous year as the market has absorbed older inventory.
Other signals of a market more and more in line with the usual business in Manhattan are:
Listing discount, the percentage difference between the list price at the time of sale and the sales price, was 6.4%, down from the 7.9% listing discount in the year-ago quarter.
The market share of cash sales recovered from the prior quarter seven-year low of 39.3% to 45.7%, consistent with the 46% share in the first quarter of 2020 that ended in the lockdown.
Finally, the market share of bidding wars, defined as properties sold above the last listing price, was 6.8%, up from the 3% seven-year low in the prior quarter and sharply below the 31% record set in the third quarter of 2015.
Bal Harbour investor sells waterfront lot for $55M
Bal Harbour investor Joseph Imbesi sold a waterfront property on the site of the former yacht club for $54.9 million. It was listed for $65 million.
The property features a 915-foot seawall, seven boat slips and has already been approved for a helipad. According to the listing, the docks can be demolished to make way for a super yacht.
Joseph Imbesi acquired the site as part of a larger $19 million deal in 1999. Imbesi sold part of that property, home to the oceanfront Bal Harbour Club, in 2012 to developer Eduardo Costantini’s Consultatio for $220 million, where Consultatio built the condo tower Oceana Bal Harbour.
In June, Imbesi sold a nearby 50,000-square-foot property to WeWork founder Adam Neumann for $44 million.