Tight inventory and high mortgage rates squeezed residential sales in Manhattan last quarter, but the market is still outpacing pre-pandemic measures.
The median sales price across the borough’s condos and co-ops fell 5.5 percent in its first pandemic-era decline, but remains more than 10 percent above pre-pandemic levels, according to a quarterly report by market analysis firm Miller Samuel for Douglas Elliman.
The decline was fueled by a spate of smaller new development sales, and prices likely don’t have far to fall, said author report Jonathan Miller.
“The median price is essentially moving sideways,” Miller said, adding that higher mortgage rates are likely causing buyers to settle for smaller new apartments.
Rising interest rates stifled fourth quarter sales in Manhattan, which fell 28 percent year-over-year.
Cash buyers rose to a record share of deals, notching 55 percent of fourth quarter transactions as more buyers avoided high borrowing costs.
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The market remains constrained by a lack of supply, which Miller said prevents prices from falling as much as one might expect during a downturn. Inventory was down 8 percent compared to the end of 2019, but up 5 percent year-over-year.
Listing inventory rose 5 percent year-over-year to more than 6,500 active units, but remained down almost 16 percent from the third quarter.
The median sales price last quarter was $1.1 million, down from $1.16 million a year earlier. The number of sales fell to 2,546, down from 3,560.
In the luxury market, defined in the report as the top 10 percent, sales fell year-over-year by 28.5 percent, from 358 to 256. The median sales price rose 4 percent annually to $5.8 million, up from $5.6 million.
Listing inventory in the luxury market rose nearly 8 percent to 1,459, up from 1,352.