Welcome to this week’s Streets365 Weekly. Each Sunday I look at the latest Manhattan market numbers, share what I notice in them, and then talk about something that happened in real estate during the past week that caught my attention. It’s a chance to look beyond any one deal and think about what’s happening around us as we begin another week.
Market Dashboard
Active Inventory — 5,829
New Listings — 418
Signed Contracts — 113
30-Day Contract Pace — 567 — 30-day rolling total
Median Days on Market
Under $1M — 79 days
$1M–$2M — 91 days
$2M–$4M — 82 days
$4M+ — 123 days
30-Year Fixed Mortgage Rate — 7.28%
These are the most current figures available to us.
What I Notice
For the third consecutive week, Manhattan inventory increased. Active inventory reached 5,829 apartments, up about 7% from the previous week and the highest level since late July. Another 418 listings came onto the market. That was considerably below the 560 new listings from the previous week, suggesting that the initial September listing surge may be starting to taper off. Even after three weeks of increasing supply, Manhattan inventory remains about 12% below the same period last year.
What concerns me more is what happened on the demand side. Only 113 contracts were signed, down 14% from the previous week and 37% from the same week last year. The 30-day contract pace declined to 567, down 5.2% from the previous week and 16.6% from a year ago. September brought more apartments to the market. Buyers haven’t yet absorbed them at the same pace.
Last week I talked about the significance of the 30-year fixed rate crossing 7% and reaching 7.03%. This week it jumped another quarter point to 7.28%. That’s the highest level in nearly three years and the sixth consecutive weekly increase. A buyer who was hoping that 7% might be a temporary threshold instead saw borrowing costs move substantially farther in the other direction.
Put these numbers together and October becomes particularly interesting. September did what September often does: sellers returned and inventory increased. Now we find out whether buyers respond. They have more apartments to choose from, but they’re making those choices with mortgage rates considerably higher than they were when September began. For sellers and their agents, pricing and positioning become increasingly important when buyers have both more choice and more expensive money.
Thought for the Week
Something happened this week that caught my attention because it involves a part of the real estate business that continues to change: how much technology should influence pricing.
A federal judge in Manhattan temporarily blocked New York State from enforcing a new law that prohibited landlords from using certain algorithmic software to help set rents. The law had been challenged by RealPage, whose software uses data to make rent-pricing recommendations. The judge described the legal question as a close one and issued a preliminary injunction while the case proceeds.
I find this interesting beyond the legal argument.
Real estate has always involved data. Agents look at comparable apartments, current competition, recent deals, days on market and what buyers or renters appear willing to pay. Technology can now process enormous amounts of that information almost instantly and recommend a price. But pricing real estate has never been only about processing numbers.
Two apartments in the same building can have different light, views, condition, layouts and emotional appeal. A seller or landlord can have different priorities about timing. The market can change between the time the data was collected and the time someone has to make a decision.
Technology will continue to become better at giving us information and identifying patterns. I think that’s useful.
What caught my attention about this week’s court decision is the larger question it raises for people who work in real estate: as technology becomes increasingly capable of recommending what something should be worth, where does professional judgment fit?
For NYC agents, I don’t think that question is going away.
Think Beyond The Deal,
George