Sellers are loathe to cut asking prices, but some have been closing deals at hefty discounts, particularly in trendy locales.
A StreetEasy report found that median sales prices in choice Manhattan and Brooklyn neighborhoods dropped by roughly 20 percent in the third quarter. In most areas, however, median listing prices remained quite a bit higher.
In Tribeca, the median sales price was $2.3 million, 36 percent lower than in the third quarter a year ago. That was the largest fall in Manhattan. Sellers’ median asking price, however, was $4.175 million — a mere 3.4 percent decrease from 2018.
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The data showed the same trend in Soho, where the median sales price was $1.96 million, a more than 25 percent drop from a year earlier but asking prices only fell by 7 percent, to $3.25 million. Similar results were found for Chelsea and the Upper West Side.
The dynamic doesn’t surprise broker Lindsay Barton Barrett of Douglas Elliman. She said developers have discounted prices on new high-end units, and declines at the lower end represent the trickle-down effect of those price drops.
As Compass broker Michael Franco sees it, prices in more expensive neighborhoods just have “further to fall” to adjust to market conditions.
The areas in Brooklyn that saw sales prices decline the most year over year included Greenwood and Boerum Hill, where they plummeted 32 percent.
In Greenwood, asking prices were 9 percent lower than in the same period last year, while Boerum Hill’s were 18 percent lower.
Though sellers in these neighborhoods did not aggressively price to match the ebbing market, their asking prices were at least tacking downward. StreetEasy’s data shows that wasn’t the case in other locales.
The most egregious discrepancies between median sales and asking prices were found in Dumbo, Prospect Lefferts Gardens and the Upper West Side, where asking prices are actually rising as sale prices fall.
In Dumbo, the median asking price jumped by 14 percent to just under $2 million year over year, and a whopping 42 percent to $1.3 million in Prospect Lefferts Gardens, according to StreetEasy. In comparison, Upper West Side sellers appeared relatively conservative with a mere 9 percent increase in asking price to $1.8 million.
The median sale price for the quarter was $1.18 million in Dumbo, $725,000 in Prospect Lefferts Gardens and $991,000 on the Upper West Side.
Sellers and buyers’ pricing seemed aligned, however, in Cobble Hill and Midtown South.
The report shows that Cobble Hill’s median sale prices fell by 27 percent to $1.6 million while median asking price plunged by 25 percent to about $1.9 million. In Midtown South, sale prices dropped 26 percent to $848,000 and asking prices fell 24 percent to $990,000.
Grant Long, StreetEasy’s senior economist, said listing prices are “unreasonably high” because “sellers are having a difficult time accepting the reality that their investment in their home is not as valuable as it once was.”
Write to Erin Hudson at ekh@therealdeal.com