“It’s been two years of unpredictability in the New York City market,” Casey Roberts, a StreetEasy Home Trends Expert said, “but this data shows that the seasonality of the sales market is back.”
Less Time on the Market
Compounding the buying bonanza is the appetite for Manhattan luxury. This month appears to have carried on from the last. A total of 35 contracts were signed for homes listed for $4 million and above in Manhattan, ending the week of Sunday March 20th, according to Mansion Global. The numbers are on par with the blockbuster sales of 2021. Impacting sales too, has been Brooklyn’s ongoing demand. StreetEasy reported that homes are staying on the market at a median of 79 days. That's 25 days faster than February of last year. In conjunction, Brooklyn for sale inventory had dropped by 12 percent.
In line with the overall figures for NYC market trends, 1,180 sellers listed their homes for sale in February 2022. That was 23.6 percent more than the previous year. The median asking price in Brooklyn, is also up — 3.2 percent over the previous year, marking the highest annual increase since May 2018.
Overall, the median number of days on the market in New York City was 88 days in February, almost a whole month (28 days to be precise) faster than last year.
“This spring will be competitive for homebuyers, but the increase we’re seeing in new inventory is promising,” Roberts, said in the report. “The recent rise in home prices should motivate even more sellers to list their homes for sale, making it easier and more likely for buyers to find and win a home they love.”
Rising Interest Rates: The Big Unknown
The big unknown in the equation is the affect rising interest rates will have on NYC homebuyers. According to a recent article in the New York Times, rates might not have too much of an impact if inflation and the day to day cost of living can be controlled. Also, New York is unlike much of the rest of the country. It’s a high end market with high end buyers and investors, many of whom are able to buy homes all cash. According to a report in Bloomberg, in some areas of New York, more than half of home sales closed without mortgage contingencies in 2021. A recent article in The Real Deal, showed an all-cash offer increases a buyer’s chance of success against their competition by a mighty 334%.
All Cash Buyers
Not everyone is fortunate enough to be able to make an all cash offer. For those, there might be a solution . Recently, a new wave of start-ups offering 100% financing have sought to level the playing the field. Realtor.com reports that companies such as Flyhomes Inc are just one of several offering non traditional financing.
Of course, the interest rates are higher than with traditional mortgages, but in a competitive market, being able to buy cash is a huge advantage. Getting a short term loan for 100% financing and then refinancing out into a conventional loan may be the way to go.
With almost 400 luxury homes, priced over $4 million, sold in the first 12 weeks of 2022 in NYC, 2021's record numbers could be beaten. Finding homes now appears to be the pressing issue, not finding the money to buy them.
