Home sales, leasing took a nosedive in Lower Manhattan in Q2

Rental inventory ballooned in FiDi and Battery Park City

New York /
Jul.July 17, 2020 08:30 AM
As Lower Manhattan’s sales and leasing volume slowed last quarter, prices and rents remained high. (iStock)

As Lower Manhattan’s sales and leasing volume slowed last quarter, prices and rents remained high. (iStock)

Lower Manhattan’s sales market saw activity and prices plummet last quarter, while its rental market chugged along, according to Platinum Properties’ quarterly report.

In Battery Park City, nine homes were sold in the second quarter — a 68 percent year-over-year drop. The median sales price also fell about 14 percent to $923,750 from close to $1.1 million the prior year.

The Financial District’s sales market took an even larger tumble. The number of sales fell 70 percent to 17, compared to 56 during the second quarter of 2019. The median sales prices dropped 22 percent to $898,500 from $1.1 million a year before.

Homeowners looking to sell their properties in both neighborhoods didn’t budge much on pricing. In Battery Park City, the average listing discount was 3.8 percent, while in FiDi it was 4.2 percent.

Within the brokerage community, there’s widespread consensus that buyers will demand discounts while the pandemic continues to shake the economy. Many estimate that the so-called pandemic pricing discount will be between 5 to 10 percent.

Platinum’s sales manager Michael Rider said he expects to see deeper price discounts next quarter. “I think there were too many unanswered questions,” he explained.

The rental market in both neighborhoods was a different story.

FiDi landlords saw median rent grow 2.6 percent year-over-year to $4,119. Though the number of new leases signed slipped 21 percent to 515 from 653 the same period last year, the figure was still up about 14 percent from 454 during the first quarter of 2020.

In Battery Park City, however, median rent slipped 5 percent to $4,805 from $5,051. The number of units rented dropped 29 percent to just 228 new leases signed, compared to 321 a year earlier.

Though both rental markets appear to have fared relatively well, Rider said that the quarterly increase in inventory could be a sign of trouble. For the last two months, the entire borough of Manhattan has reported unprecedented increases in vacancy.

FiDi inventory has ballooned by 40 percent to 1,056 apartments on the market, compared to 757 available in the first quarter of the year. Battery Park City inventory grew by almost 73 percent to 473 from 274 the quarter before. That said, both numbers are on par with inventory in the second quarter of 2019.

But Rider says that the low number of new leases signed coupled with rising inventory is prompting landlords, particularly in FiDi, to make some big concessions, from offering up to two and a half months of free rent on a 12-month lease, to waiving amenity and move-in fees.

“It’s kind of amazing,” he said.

Write to Erin Hudson at [email protected]


Related Articles

arrow_forward_ios
Illustration of Loews Corporation's Jonathan Tisch and Taubman Centers’ Robert Taubman (Photo Illustration by Steven Dilakian for The Real Deal with Getty Images)
Tisch, other Hamptons billionaires shamed by water authority
Tisch, other Hamptons billionaires shamed by water authority
Corcoran's Tim Davis with 1116 Meadow Lane (Tim Davis Hamptons)
Estate trades for $48M on Meadow Lane — $9M above ask
Estate trades for $48M on Meadow Lane — $9M above ask
Housing, Collapse
Housing starts collapse under inflation, high rates
Housing starts collapse under inflation, high rates
Blend Labs ceo Nima Ghamsari (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Blend)
Digital mortgage firm Blend loses $478M, sheds more of workforce
Digital mortgage firm Blend loses $478M, sheds more of workforce
(Illustration by Kevin Rebong for The Real Deal with Getty)
Mortgage demand drops to turn-of-the-century levels
Mortgage demand drops to turn-of-the-century levels
From left: Lee Mintz, Eugene Litvak, Phillip Salem and Compass CEO Robert Reffkin (Compass, Lee Mintz, Getty)
Compass agents defend company against taunts of “financial negligence”
Compass agents defend company against taunts of “financial negligence”
Wells Fargo CEO Charles Scharf (Getty Images)
Wells Fargo backing off mortgage market
Wells Fargo backing off mortgage market
One Brooklyn Bridge Park units 427/8 and 1115 (StreetEasy, Google maps)
One Brooklyn Bridge Park condos top Brooklyn luxury market
One Brooklyn Bridge Park condos top Brooklyn luxury market
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...