Buyers in Manhattan and Brooklyn pulled away from the market last month, allowing for a much-needed increase in new inventory.
After months of healthy increases in contract signings in Manhattan, they declined 7 percent for co-ops and increased just 2 percent for condos from May 2021, according to a report by Douglas Elliman compiled by Miller Samuel.
Not all contracts lead to sales, but they indicate where sales numbers will go in the coming months.
Deals for one- to two-family homes surged 59 percent, but the sample size is too small to call that significant: Twenty-seven homes entered into contract in May 2022 as opposed to 17 in the same month last year.
Despite cash buyers accounting for about half of Manhattan home sales, rising mortgage rates have slowed buying, according to Jonathan Miller, the author of the report.
“Consumers ratcheted down their enthusiasm a notch as a result of jumping rates,” Miller said.
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New listings in the wealthiest borough grew by 18 percent for condos and 80 percent for one- to three-family homes. Co-ops remained an outlier with new listings increasing by just 0.5 percent.
Brooklyn also faced a cooling market. New signed contracts fell 6 percent for co-ops, 6 percent for condos and 13 percent for one- to three-family homes.
New listings were somewhat lackluster for co-ops, increasing by 2 percent. However, they jumped 12 percent for condos and 35 percent for one-to-three family homes.
The past year has been defined by bidding wars and homes being scooped up without lingering on the market. The report indicates that stabilization may be underway.
“This has been one of the most intense housing booms in history over the last year and a half or so,” Miller said. “The market appears to be beginning to normalize and that is allowing inventory growth to occur.”