Manhattan residential market shows signs of recovery

TRD New York /
Jan.January 04, 2010 09:56 PM

In the fourth quarter of 2009, there were fewer price cuts, more price increases than before, a decrease in inventory and a jump in contracts from a year earlier, according to a fourth-quarter market report released today by Streeteasy.com.

Though Manhattan hasn’t quite recovered from the Lehman Brothers collapse, “there’s a growing sense of buyer confidence and seller optimism,” said Sofia Song (formerly Sofia Kim), vice president of research at Streeteasy and the author of the report.

In the fourth quarter, 3,810, or 27.4 percent, of Manhattan listings on Streeteasy.com saw their prices drop at least once, according to the Web site, which specializes in real estate data. That’s 29 percent fewer price cuts than in the third quarter, and 14.4 percent fewer than in the fourth quarter of 2008.

“We saw fewer price cuts, and those price cuts were not as deep,” Song said.

Condos saw an average price cut of 7.8 percent, down from 8.4 percent in the third quarter, the report says, while the average price cut for co-ops was 7.7 percent, compared to 8.1 percent in the previous quarter.

Moreover, there were actually some price increases in the fourth quarter, though they were still rare, Song said.

That quarter, there were 237 listings that saw their prices rise, up from around 130 in the fourth quarter of 2008, in the immediate aftermath of the Lehman Brother collapse. There were 20 percent more price increases in the fourth quarter than the previous quarter, the report says.

Unlike the city’s brokerages, which released fourth-quarter reports today as well (for a closer look at the firms’ market reports, click here), Streeteasy.com also publishes market-wide data on contracts signed. In the fourth quarter, contract activity slipped 13.7 percent to 2,272 from the third quarter. Perhaps not surprisingly, though, it skyrocketed by 130 percent from 986 contracts in the fourth quarter of 2008.

Streeteasy.com’s report also shows detailed data about declining inventory.

The average number of new listings in the site’s database was 278 per week in the fourth quarter, the report shows, down from the third quarter, when the number of new listings per week averaged 314. It’s also far less than the last quarter of 2008, when an average of 338 new listings entered the market each week.

Song attributed the trend to a decrease in panic-selling.

“At the time when Lehman collapsed, people were so scared,” she said. “Layoffs were going on like crazy, and you had a lot of motivated sellers.”


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