Welcome to this week’s Streets365 Weekly. Each week I take a look at the latest Manhattan market numbers, share a few things I notice in those numbers, and then talk about something that happened in real estate during the week that caught my attention. My hope is that it gives you a little perspective on the market and something useful to think about as you begin the week ahead.
Market Dashboard
Active Inventory — 4,462
New Listings — 104
Signed Contracts — 160
30-Day Contract Pace — 771
Median Days on Market
Under $1M — 79 days
$1M–$2M — 91 days
$2M–$4M — 82 days
$4M+ — 98 days
30-Year Fixed Mortgage Rate — 6.71%
These are the most current figures available to us.
What I Notice
Inventory continues to be the number that gets my attention. Manhattan finished August with 4,462 active listings, more than 20% below a year ago. At the same time, the 30-day contract pace had fallen to 771 by late August. That combination tells me that this isn’t simply a story about strong demand absorbing everything that comes to market. There are fewer apartments available, but there are also fewer buyers signing contracts as we come out of the summer.
The days-on-market numbers add another dimension. Apartments under $1 million had a median of 79 days on market, while the $1 million to $2 million range was at 91 days and properties over $4 million were at 98 days. Even with limited inventory, buyers are taking their time with apartments that don’t immediately make sense to them.
The luxury market is interesting because it continues to behave somewhat differently. Twenty-four contracts at $4 million and above were signed during the last week of August, nine more than the previous week. That doesn’t change the overall summer slowdown, but it does remind us that there isn’t really one Manhattan market. Different price ranges can be doing very different things at the same time.
Mortgage rates moved in the other direction this week. The average 30-year fixed rate increased to 6.71%, from 6.66% the previous week. For buyers who were hoping that financing costs would begin moving meaningfully lower as we approached the fall market, that hasn’t happened yet.
Thought for the Week
There were two housing stories that caught my attention this week.
The first was the continuing fight over New York City’s rent freeze. A judge heard arguments this week in a lawsuit brought by landlords challenging the Rent Guidelines Board’s decision to freeze rents for roughly one million rent-stabilized apartments. The landlords are arguing that the process was improperly influenced by Mayor Mamdani and that the freeze doesn’t adequately account for the increasing costs of operating their buildings.
I’m interested in where this goes because New York has always struggled with the same basic housing problem. We want housing to remain affordable for the people who live here, while the buildings themselves have to remain financially viable. Property taxes, insurance, labor, repairs and maintenance don’t stop increasing because rents are frozen.
There isn’t an easy answer to that. A rent increase that looks relatively small on paper can be significant to someone already struggling with the cost of living in New York. At the same time, a building has to generate enough income to be properly maintained. Those two realities exist together, and whatever happens with this lawsuit isn’t going to make that underlying problem disappear.
The other story that caught my attention was about first-time homebuyers. Nationally, they now represent only about 21% of buyers, compared with roughly 40% historically.
That number is striking.
New York has never been an easy place to become a first-time homeowner. The price of the apartment is only the beginning. Buyers need substantial cash for a down payment and closing costs, and in a co-op they also need significant post-closing liquidity. Add today’s mortgage rates and monthly maintenance or common charges, and the financial hurdle becomes considerable.
When I put these two stories together, what strikes me is how difficult the housing equation has become. We’re trying to keep rental housing affordable at one end while fewer people nationally are making the move into homeownership at the other.
New York is its own market, and national numbers don’t always translate neatly to Manhattan. Still, I think the direction is worth paying attention to. If fewer people are able to make that transition, it eventually affects more than those individual buyers. It affects the pool of future buyers, how long people remain renters and ultimately the way the housing market functions.
I don’t know that either of these stories has a simple solution. What they have in common is something we’ve been talking about in New York for a very long time: how do we make it possible for people to continue to live here?
I’ll be interested to see where both of these stories go.
Think Beyond The Deal,
George.