NYC’s Resi Market Closed 2024 On High Note

New York City’s residential market ended the year with a show of strength.

Contract activity in Manhattan picked up again in December, as more homes continued to hit the market in the borough, according to Miller Samuel’s monthly report for Douglas Elliman. In Brooklyn, new signed contracts held steady while new listings nearly doubled from the same month in the previous year.

“Typical consumers are sick of waiting,” said appraiser and report author Jonathan Miller, who pinned the gains on “pent-up demand” among buyers and sellers who are no longer counting on significant drops in mortgage rates.

Transactions stalled across the country in the second half of 2022, when the Federal Reserve began hiking interest rates and mortgage rates rose as a result. The central bank started lowering rates in September, spurring a short-lived decline in mortgage rates, which have since crept back up to about 7 percent.

“It’s been three years, and rates are probably going to be a bit lower in the next year or two, but not a lot lower,” Miller said. “Life keeps moving on.”

Last month, new signed contracts in Manhattan rose from 524 to 723, marking a 38 percent increase year-over-year and continuing an uptick in activity that started in the late summer and early fall, even though many in the industry expected transactions to slow ahead of the election in November.

New listings in Manhattan expanded 42 percent annually, up from 415 to 589. The jump in homes hitting the market came after the metric held steady in the previous month.

Manhattan’s luxury market, defined as homes asking $4 million or more, outperformed the overall market, with the number of inked deals nearly doubling year-over-year. Miller attributed the increase to the financial markets, which despite some volatility, are generally logging gains.

But listing inventory in the luxury sector declined significantly in the fourth quarter, according to Miller’s quarterly report for Elliman. Miller said fewer listings for the segment, defined in the report as the top 10 percent of home sales, has kept prices high, with the median sale price rising 13 percent annually to roughly $6.5 million.

In Brooklyn, new signed contracts held steady, after the borough notched year-over-year gains every month since April. New listings soared in December, nearly doubling last year’s numbers. More than 570 homes hit the market in Brooklyn last month, up from 292 in the same period in 2023.