Berkshire Hathaway HomeServices Manhattan Market Report …
MANHATTAN
MARKET REPORT
4th Quarter 2017
RESALE
LETTER FROM THE PRESIDENT
The close of the fourth quarter ushers in an important time for reflection. Reflecting on 2017, Berkshire Hathaway HomeServices achieved several milestones, including a national award from J.D. Power recognizing our excellence in seller service, notable company acquisitions and becoming the fastest growing real estate brand with nearly 44,000 agents across the country. Still, it is the strength of our referral network that continues to impress me. Since opening our doors at 590 Madison Avenue one year ago, our agents have been the recipients of over 125 referrals from the Berkshire Hathaway HomeServices network, and we anticipate those numbers to grow.
We are especially proud of the culture that has developed in our o ce; this tiny little piece of New York City sky that we call home. We are constantly asked how our company is di erent, and can proudly say that we are di erent because of the emphasis we place on culture. By doing so, we are able to bridge the gap between luxury and humility, bringing the very best out in the people we work with. A positive and supportive company culture is a vital component of our success and clients' satisfaction; which remains a top priority for me in the new year.
The Manhattan real estate market has also seen its own change and growth this past quarter. The new tax law has been passed; thus, melting the freeze that weighed heavy on buyers and sellers. We anticipate a dip on our local market, however, it will be less than other American cities. Once again, proving the New York City real estate market is one of the most resilient markets in the world.
Following a period of uncertainty in 2016, the Manhattan residential resale market has shown steady growth in the number of closed sales in the 4th quarter of 2017 as compared to the same quarter prior year. Median prices began to soften this quarter in the condominium market as cooperatives demonstrated the consistent growth they have shown for years. The closed sales prices for condominiums saw growth in the areas of Lower Manhattan and Downtown East, while the upper portions of Manhattan continue to be dominated by the cooperative market in terms of price growth. The demand for cooperatives in Lower Manhattan is very high and therefore almost inelastic; sellers are confidently dictating price points due to a product scarcity. The demand and prices for residential real estate in Lower Manhattan are expected to see continuous growth as the neighborhood's transit connectivity, restaurant scene and residential amenities expand. Increased sales in the below $3M price segment greatly contributed to the growth of closed sales overall. The uptick was likely boosted by first-time home buyers seeking one-bedroom units, due to the substantial and continuous increases in rental prices and improved confidence from a favorable job market. The ultra-luxury resale market saw moderate growth in the number of closed sales, triggered by a number of luxury trophy penthouses sold in the $20M+ price range. These impressive sales factored into the overall increase in average prices for condominiums and cooperatives this quarter. As the current market indicators, the number of contracts and new listings showed a slight decline this quarter, potentially a reaction to the introduction, debate, and recent passing of the tax bill.
With each new year, the market ebbs and flows, and we must always be ready to adapt. Overall, residential real estate in New York City will continue to thrive. Yes, interest rates will increase slightly, properties that are overpriced will need readjustment and buyers and sellers will continue to seek the highest levels of returns on their investments, accordingly. The entry to mid-level market continues to su er from a lack of inventory; thus, creating great opportunities for sellers to list their proprieties and achieve excellent results. For other product in the mid-level to ultra-luxury, including townhouses, sellers will need to pay close attention to market conditions and act promptly to changes in the market.
We entered 2018 on a positive note, with properties going under contract and new inventory being prepared for release. It is our resolution for the year to continue striving for the best for our clients and our agents, and to raise the bar in this thriving and ever-changing industry. As always, we remain thankful for our incredible clients and partners, and wish you all a happy, healthy and successful new year.
Sincerely,
Ellie Johnson | President elliejohnson@
Berkshire Hathaway HomeServices New York Properties 212.710.1900 590 Madison Avenue New York, New York 10022
MAJOR MARKET PERFORMANCE
year over year closed sales (median price)
Q4 2017 Market Report MANHATTAN
MIDTOWN WEST
Condo: $1,219,000 Co-op: $670,000
Townhouse*: $1,400,000
10.82% 12.89%
DOWNTOWN WEST
Condo: $2,170,000 Co-op: $950,000
Townhouse*: $2,387,500
3.45% 5.56%
UPPER MANHATTAN
Condo: $740,000 Co-op: $532,500 Townhouse*: $1,900,000
4.88% 4.00%
UPPER WEST SIDE
Condo: $1,315,0000 Co-op: $1,050,000
Townhouse*: $1,447,500
21.26% 24.00%
LOWER MANHATTAN
Condo: $994,997
8.39%
Co-op: $1,900,000 153.33%
Townhouse*: No recorded sales
UPPER EAST SIDE
Condo: $1,400,000 Co-op: $840,000
Townhouse*: $15,000,000
16.42% 1.00%
MIDTOWN EAST
Condo: $1,200,000 Co-op: $683,196
Townhouse*: $18,900,000
4.00% 16.79%
DOWNTOWN EAST
Condo: $2,020,000 Co-op: $825,000
Townhouse*: $4,200,000
12.22% 4.07%
*Note: Due to a limited amount of townhouse inventory in Manhattan and its wide diversity, the price trends normally show heavy fluctuations, especially when segmented by the major markets. Therefore, the percentage di erence for median sales of townhouses was not shown on this map.
7
3
NEW LISTINGS
MARKET SNAPSHOT BY TYPE
Q4 2017 Market Report MANHATTAN
CONDO
% year over year
Median Listed Price
12.1%
# of New Listings
5.7%
METRIC Average Listed Price Median Listed Price Average SF Average PPSF # of New Listings
Q4 2017 $2,416,097 $1,737,500
1,274 $1,780
874
Q3 2017
Q4 2016
$2,197,685 $2,465,905
$1,400,000 $1,550,000
1,177
1,282
$1,639
$1,697
1,295
927
QoQ% YoY% 9.94% -2.02% 24.11% 12.10% 8.24% -0.62% 8.60% 4.89% -32.51% -5.72%
CO-OP
Median Listed Price # of New Listings
3.1% 2.9%
METRIC Average Listed Price Median Listed Price Average SF Average PPSF # of New Listings
Q4 2017 $1,206,879
$789,500 1,180
$1,098 1,252
Q3 2017 $1,397,583 $800,000
1,264 $1,129 1,643
Q4 2016 QoQ% YoY% $1,431,532 -13.65% -15.69% $815,000 -1.31% -3.13%
1,183 -6.65% -0.25% $1,055 -2.75% 4.08%
1,217 -23.80% 2.88%
TOWNHOUSE
Median Listed Price # of New Listings
45.0% 44.9%
METRIC Average Listed Price Median Listed Price Average SF Average PPSF # of New Listings
Q4 2017 $2,505,000 $2,700,000
2,647 $1,755
27
Q3 2017
Q4 2016
$2,753,192 $3,460,220
$2,250,000 $1,862,000
2,841
3,827
$1,364
$1,633
39
49
QoQ% YoY% -9.01% -27.61% 20.00% 45.01% -6.83% -30.83% 28.67% 7.47% -30.77% -44.90%
The total number of new listings that came on the market during this quarter decreased for both condos and townhouses as compared to this quarter last year. Whereas co-op inventory increased by almost 3%, thus making it the only ownership type to show a year over year increase. The dip in new condo and townhouse listings occurred in December, as sellers decided to hold off on listing their properties to feel out the market following approval of the tax bill. Due to historically established relatively inelastic demand for co-op units, the co-op market was less responsive to turbulences caused by external factors.
Compared to this quarter last year, the number of new listings for condo units decreased by 6%. The median price showed a 12% increase this quarter, while the average price declined by 2%, indicating a number of new listings on the lower end of the market.
The new co-op inventory increased by almost 3% on a year over year basis. Both average and median prices for newly listed co-op units showed a decline of 16% and 3% respectively. Likely, that is due to co-op sellers having pushed prices to new limits in previous quarters, taking advantage of inelastic demand for scarce co-ops, as the price gap relative to condo units continues to increase.
Due to the diversity of townhouse properties, year over year differentials usually tend to fluctuate heavily. Therefore, a 45% increase in median price for newly listed townhouses accounts for an increased number of properties on the higher end of the market. The number of new listings declined by 45%, impacted by the di erence in features from the townhouses listed on the market last year.
4
NEW LISTINGS
MARKET SNAPSHOT BY TYPE
MEDIAN LISTED PRICE BY TYPE
$2.0M
CONDO CO-OP
$1.5M
$1.6M
$1.4M
$1.2M
$1.0M
$0.8M
$0.6M
Q4 2017 Market Report MANHATTAN
TOWNHOUSE
$4.0M $3.5M $3.0M $2.5M $2.0M $1.5M $1.0M
Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017
Jul 2017 Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017 Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017
Jul 2017 Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017
Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017
Jul 2017 Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017
NUMBER OF NEW LISTINGS BY TYPE
1800 1600 1400 1200 1000 800 600 400 200
Q4 2016
Q1 2017
Q2 2017
Q3 2017
Q4 2017
TOWNHOUSE CO-OP CONDO
? The total number of new listings that came on the market during this quarter decreased for both condos and townhouses while co-op inventory increased by almost 3%.
The median price for condo units showed a 12% increase this quarter.
Both average and median prices for newly listed co-op units showed a decline of 16% and 3% respectively.
? A 45% increase in median price for newly listed townhouses accounts for an increased number of properties on the higher end of the market.
5
CONTRACTS SIGNED
MARKET SNAPSHOT BY TYPE
Q4 2017 Market Report MANHATTAN
CONDO
Median Price # of Contracts Average DOM
% year over year
3.4% 13.3% 2 days
METRIC Average Price Median Price Listing Discount* Average PPSF # of Contracts Average DOM
Q4 2017 $2,462,276 $1,390,000
-4.96% $1,490
699 136
Q3 2017 $2,119,229 $1,386,000
-5.39% $1,462
714 133
Q4 2016 $2,149,785 $1,439,000
-5.89% $1,487
806 138
QoQ% YoY% 16.19% 14.54% 0.29% -3.41% -0.43% -0.93% 1.92% 0.20% -2.10% -13.28% 2.26% -1.45%
Unlike closed sale trends, the number of condo units that entered into contracts decreased substantially, by over 13% compared to this quarter last year. Similar to trends among new listings, the contract activity was relatively steady in October and November of 2017 but decreased in December, when the new tax bill was passed and buyers entered another period of uncertainty. As a timely market indicator, the number of contracts reflect the current willingness of buyers to commit to a purchase, a factor which is directly impacted by external events. The median price for condo units showed a 3% decrease from this quarter last year and led to the decrease in listing discount. Condos' average time on the market remained relatively steady, decreasing by only 2 days.
CO-OP
Median Price # of Contracts Average DOM
3.3% 9.7% 6 days
METRIC Average Price Median Price Listing Discount Average PPSF # of Contracts Average DOM
Q4 2017 $1,334,299 $800,500
-3.86% $1,010
1,281 101
Q3 2017 $1,193,522 $750,000
-3.63% $984 1,135 99
Q4 2016 $1,220,801 $775,000
-3.20% $973 1,418 95
QoQ% YoY% 11.80% 9.30% 6.73% 3.29% 0.23% 0.66% 2.64% 3.80% 12.86% -9.66% 2.02% 6.32%
The number of contracts for co-ops also decreased, by almost 10% from the previous year. However, unlike the condo market, the median price of co-ops increased by 3%, signaling that, due to the scarcity of co-op inventory, sellers did not mind their listings spending more time on the market at a higher price. Nevertheless, the average days co-ops spent on the market increased by only 6 days, meaning buyers were willing to pay higher prices due to the lack of co-ops in the lower price range.
TOWNHOUSE
Median Price # of Contracts Average DOM
9.5% 0.0% 12 days
METRIC Average Price Median Price Listing Discount Average PPSF # of Contracts Average DOM
Q4 2017 $2,657,067 $2,300,000
-4.14% $1,608
27 135
Q3 2017 $3,887,071 $3,643,500
-8.54% $1,791
32 144
Q4 2016 $2,743,426 $2,100,000
-6.44% $1,682
27 123
QoQ% YoY% -31.64% -3.15% -36.87% 9.52% -4.40% -2.30% -10.22% -4.40% -15.63% 0.00% -6.25% 9.76%
Compared to last year, the contract activity for townhouses remained flat. The median price increased by almost 10%, while the average price dropped by 3%, accounting for a number of low-tier townhouses in Upper Manhattan that entered into contract this quarter. As a result, the listing discount dropped to 4%, compared to 6% in the same quarter last year. On average, townhouse listings spent 12 days more on the market than they did a year ago.
*Note: Listing Discount for Contracts Signed is the percentage di erence between the original asking price and the last listed price.
6
CONTRACTS SIGNED
MARKET SNAPSHOT BY TYPE
Q4 2017 Market Report MANHATTAN
NUMBER OF CONTRACTS & MEDIAN LAST LISTED PRICE BY TYPE CONDO & CO-OP
300
200 Condo
100 0
600
400 Co-op
200
0
Number of Contracts
Number of Contracts
$1.5M
$1.0M
$0.5M $0.0M $0.8M $0.6M $0.4M $0.2M $0.0M
Median Price
Median Price
CONDO, MEDIAN PRICE CONDO, NUMBER OF CONTRACTS
? The number of condo units that entered into contracts decreased substantially, by 13%.
? The median price for condo units showed a 3% decrease from this quarter last year.
? The median price of co-ops increased by 3%, while the number of contracts decreased by almost 10%.
CO-OP, MEDIAN PRICE CO-OP, NUMBER OF CONTRACTS
Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017
Jul 2017 Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017
NUMBER OF CONTRACTS & MEDIAN LAST LISTED PRICE TOWNHOUSE
35
$6.0M
30
$5.0M
25 $4.0M
20 $3.0M
15
$2.0M 10
5
$1.0M
0
$0.0M
MEDIAN PRICE NUMBER OF CONTRACTS
? The contract activity for townhouses remained flat.
? The median price increased by almost 10%, while the average price dropped by 3%.
Number of Contracts Median Price
Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017
Jul 2017 Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017
7
CONTRACTS SIGNED
MARKET SNAPSHOT BY PRICE & BEDROOM
% NUMBER OF CONTRACTS BY PRICE
PRICE RANGE
Q4 2017
Q3 2017
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