New York’s real estate market has become a tale of two fortunes.
There is Brooklyn and the suburbs, where new contracts surged in August, according to the latest market report from Douglas Elliman.
Then there is lonely old Manhattan, where real estate executives are leading the charge for companies to return to work; where the business community is taking every opportunity to tout the city’s unshakable foundation; and where home sales continue to tumble.
Contracts for condos in the borough fell almost 38 percent last month from the same period last year, while new listings went up 30 percent, the report showed. Co-op contracts fell 26 percent.
The ultra-luxury market was particularly slow, with no condo contracts signed above $20 million and four between $10 million and $19.99 million. Most deals were between $1 million to $4 million.
“That urban-to-suburban story has to be recast as Manhattan-to-suburban,” said appraiser Jonathan Miller, who compiled the report.
Since the pandemic hit, much has been made of the so-called “death” of cities. However a recent report from Zillow showed that urban and suburban residential real estate markets have mostly fared the same — the Northeast being the exception.
In the Hamptons, contracts for single-family homes climbed 109 percent in August from the same period last year, to a total of 278. New listings also doubled. In Norfolk, home deals went up 76 percent.
The pandemic is a huge driver, of course — but not only because it sparked a rush of interest in homes with privacy and outdoor space.
“A lot of this unusual surge isn’t just outbound migration from Manhattan but it’s the fact that there wasn’t a spring market — it was locked down — and the summer ended up being a release point for all this pent-up demand and pent-up supply,” Miller said.
But now, there are potential signs that the frenzy may be leveling off. In some suburban areas, including Westchester, Fairfield and Long Island, the month-over-month figures seemed to plateau or peak, Miller said. Whether that’s a temporary easing or the sign of something bigger remains to be seen.
Deals in Brooklyn have mostly followed the upward trajectory of the suburbs. Co-op deals climbed 181 percent last month to a total of 138, the report showed. Most of them were in the $500,000-$999,000 range, followed by the second-largest bracket, under $500,000. There were zero co-op deals above $4 million.
Condo deals in the borough also climbed, however the 33 percent increase was markedly more modest than the co-op figures. Just three of the condo contracts were above $4 million.
Single-family home contracts totalled 128 in August — up from 50 in the same month last year.
“[Brooklyn] didn’t take the hit that Manhattan did, and it continues to show that,” Miller said, noting that demand appeared to be outpacing supply.
“If you look at the two of the three property types, there was larger growth in signed contracts than there was in new inventory coming on.”
Write to Sylvia Varnham O’Regan at [email protected]