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On October 5th, the New York Times article titled “Manhattan Apartment Sales Surge to Three-Decade High” was published. If you follow any real estate agent on social media you probably saw them post this article on their pages.
After reading this article, I came to the conclusion that it left out a lot of important information which would reflect a more accurate picture of the real estate market. My comments should provide more color and understanding especially for those readers looking to buy or sell right now. This is not an opinion piece on the writer or those who contributed to this article. These are taken directly from the article hence the quotes.
Yes, the fire sales we saw were very short lived. Post shut down, there was a period that condos were heavily discounted for the purpose of selling quickly. It was purely out of panic. However, buyers in the luxury market are still picking up real estate at deep discounts. These are deals that most often fly under the radar and are not reported on for many reasons. The term ‘fire sale’ here relates to the known price drops of apartments on the market but in new development a lot of these discounts are given on off market properties. Keep in mind that when a new development starts selling its units, it keeps the hefty majority of its units off of the market. In my opinion, the heavy concessions in the luxury market is what is fueling this sector, not an improved overall sales market. I think if developers did not move on price and/or concessions, these apartments would not sell.
The uptick in sales in NYC is fueled by the downward pressure on asking prices or multiple price drops creating a more realistic opportunity for buyers to pick up real estate. Yes, low mortgage rates have helped too. When mortgage rates are low, buyers can afford more.
The true discount should be calculated from the original asking price, not the last asking price. By looking at the discount from the last asking price you are missing the whole picture because the discount from the original asking price is higher, in many instances.
It is important to question the narrative in anything you read. Be curious to know more and stay curious. There was a lot of missing context that readers should be privy to, especially those looking to make a large financial decision such as buying or selling real estate in NYC. If you’re looking for a trusted real estate advisor with an honest approach please reach out.