Manhattan Real Estate Market is Softer Now Than It Was a Year Ago

Both the volume of sales and the price of co-ops and condos in Manhattan fell sharply in the third quarter of 2019. This was partly attributed to the implementation of a higher transfer tax for luxury apartments that went into effect in July, but in general the decline is not limited to high-end sales.

As reported in the Douglas Elliman report there were 2,562 sales in the third quarter, down 14.2 percent compared to the same period last year. Additionally, the median sales price fell 8.2 percent

There were 2,562 sales in the third quarter, down 14.2 percent compared to the same period last year, and the median sales price fell 8.2 percent to $1,025,000, according to a Douglas Elliman report.

Compass, another real estate brokerage, said that properties in the third quarter spent an average of 152 days on the market, the longest period since 2012.

While much of the slowdown has occurred at the top of the market, especially in new development, the pullback has been widespread. Resale apartments sold for an average of $1,359,654, the lowest in nearly five years, according to the brokerage Halstead.

“The report is finally showing what the market is,” said Diane Ramirez, the company’s chief executive. “I think we’re at the bottom, or at least very close to it.”

One of the biggest reasons for poor sales in the third quarter was that many buyers rushed to close in the spring, before changes to the so-called “mansion tax” took effect, said Jonathan Miller, the president of Miller Samuel Real Estate Appraisers & Consultants, and author of the Elliman report.

In July, a flat 1 percent tax on sales above $1 million was changed to a staggered rate starting at 1.25 percent for $2 million sales, and up to 3.9 percent above $25 million.

Compared to the same period last year, sales were down in every price tier except for apartments below $500,000, which rose 4.8 percent to 352, according to the Elliman report. There were 757 sales between $1 million and $2 million, a decline of 4.7 percent over the same period last year, while the percent of sales at all higher prices was down by double digits.