March 2023 Market Overview

March 2023 Market Overview

  • Karp Dagan Team
  • 03/1/23

The Manhattan real estate market is seeing deal volume tick back up notably. This is happening while inventory is operating at a slight net deficit. Units that sat on the market during a stagnant Q4 have been absorbed and prices are showing a slight rebound, and negotiability discounts are starting to come down. If this trend continues the leverage slipping away from buyers will tip towards sellers for the near term. We expect tight supply conditions and buy-side competition for well-priced units. There is a lack of ‘fresh’ inventory on the market.

Most Expensive Market In The World New York City remained the world’s priciest housing market in 2022, in a report that ranked the leading 10 global locations for home sales over $10 million (also known as “super-prime” sales) and $25 million (“ultra-prime” sales). NYC had 244 super-prime sales and 43 ultra-prime sales. London came in second, tying for ultra-prime sales but boasting 21 fewer super-prime deals. Los Angeles took third place — followed by Hong Kong, Miami, Singapore, Palm Beach and Broward, Geneva, Sydney and Paris. (In total, the super-prime and ultra-prime transactions in the top 10 cities totaled an eye watering $36.1 billion.) Despite once again taking the highest slot, New York’s real estate growth in 2022 was significantly smaller than other cities: While Los Angeles saw its market prices surge by 8%, and Miami saw its own go up by 22%, New York’s only saw 3% growth last year.

Luxury Market In the Manhattan luxury sector, the first two months of 2023 have seen an uptick in signed contract volume of around 11.5% compared to 2019, while down 29% compared to January/February 2022, and slightly up - 8% - compared to November/December 2022. Taking inflation into account, 2023's market may look similar to 2019. Overall all segments have performed notably better than in the last quarter of 2022.

31 contracts were signed in Manhattan last week at $4 million and above, 8 more than the previous week. It was the second time this year more than 30 contracts were signed. Condos outsold co-ops, 19-10, with 1 condop and 1 townhouse in the mix.

Last week the negotiability was 12% and the previous week was 10%. Year-to-date, discounts are averaging 8%. 2022 averaged 5% and in 2021, a record setting year in Manhattan’s luxury market, discounts averaged 9%. 

Rental Market Rental vacancies finished 2022 at 5.3%, the lowest vacancy rate on record since 1988. The rental industry saw 7.5% income growth in 2022, the highest historically except for during the recovery from COVID.

December marked the fourth straight month in which rents declined nationally, but landlords in Manhattan continued to hold the line. After peaking at $4,150 in July, the median rent in the borough has bounced between $4,000 and $4,100 ever since.

#1 Brokerage in NYC! For the second year in a row, Compass was ranked the #1 Brokerage in Manhattan for number of closed sales transactions and the #1 Brokerage in Brooklyn in both closed sales volume and number of closed sales transactions in 2022.

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