It is my pleasure to share Compass' 3Q16 Manhattan Market Report, which looks at the prevailing trends shaping the market from this past quarter and provide a glimpse into the research and data analytics in which Compass prides itself.
Highlighting a few trends:
- The total number of closings in the third quarter (2,739) was below expectations, down 25% compared to the third quarter last year. However, total contracts signed exhibited a more modest decline (-8% Y-o-Y) and actually increased year-over-year for co-op units priced between $1M and $3M. When considering these figures, it is important to remember the variable lag time between contract signing date and closing date as well as the unpredictable closing schedules of new development condominiums, which make up an increasingly large percentage of the over market.
- Available inventory is seemingly disconnected from the demands of the market at this moment in time, as units priced above $3M make up 28% of inventory and less than 14% of contracts signed.
- Co-op inventory is limited (45% of total inventory) and demand is high (54% of contracts signed) as asking prices continue to rise in the condo market.
- The median price of active condo units was $2.3M in the third quarter, up 10% year-over-year and 44% higher than the median contract price of condo units this quarter ($1.6M). Them median closing price for condos ($1.65M) was a 10% increase compared to the third quarter last year, while the median closing price for co-op units set a new high at $820K.
Uncertainty in the marketplace continues as the Federal Open Market Committee decided in their September meeting to leave the Federal funds rate unchanged and the presidential election reaches a fever pitch in the final stretch to Election Day 2016. Demand for homes priced under $3M, those most likely to be used as primary residences, continues virtually unabated while the continued increase in new development inventory, especially at the highest end of the market, has further reduced urgency for luxury buyers.