It's a "Buyer's Market". . . FOR NOW |
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The long and short of it?... it’s a Buyer’s Market…“for now.” Remember that phrase?
It’s the beginning of a new year, and a ripe new cycle. I say this because, it literally feels like the beginning of 2020, all over again. At that time we had come off 4-5 years of slowing market activity, which was like the air slowly coming out of a balloon. When January came we were on the verge of making the turn, and it started off great; the anticipation was buzzing among the brokerage community. It was going to be a helluva year…and then…boom, COVID. “The best-laid plans of mice and men often go awry.” Like then, there’s a buzz right now and the consensus is that we will finally pick-up where we had left off then. Hopefully, this year’s optimism translates into something positive for all parties in the marketplace…buyers and sellers…as long as something catastrophic doesn’t happen, we are likely to see some robust activity.
That was 2020; more recently, in the Spring of 2022, the war in Ukraine had already broken out, supply chains were still sticky and interest rates were on the cusp of the steepest rise any of us have experienced in our lifetimes, 3% to nearly 8%...over double. As a result, deal volume slowed substantially and has remained languid for the past very-long 18 months now. Those falling dominos quashed demand; as a result, we had 27% fewer closings in 2023 than in 2022. In turn valuations softened (and for the most part pricing), by somewhere in the 8-10% range, according to Noah and John at UrbanDigs. See their price/sqft chart below.
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Click on each respective chart to expand. Courtesy: UrbanDigs
Consequently, we are quite literally in a Buyer’s Market, one where buyer leverage could even be stronger if the inventory levels were not so low. These low levels have served to actually support price levels from having fallen even more. See the inventory chart below which indicates that we are experiencing the lowest number of listings in nearly 5 years, but this is about to change, as we are in the beginnings of the seasonality of Winter when many listings begin to populate the marketplace.
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Click on each respective chart to expand. Courtesy: UrbanDigs
My above forecast, predicting robust activity, could of course change, depending on the following factors:
A) How soon, and how often, will the Fed cut interest rates and how quickly will it translate to more favorable mortgage rates. In the last few weeks of December we already saw some lower rates and it is LIKELY to moderately continue.
B) Will these recent (and anticipated) interest rate cuts spur more buyers to come to market? – LIKELY, as sentiment has already improved.
C) Will the interest rate cuts encourage more sellers to enter the market? LIKELY, for the same reason as buyers; remember, sellers become buyers too. Sellers, knowing that interest rates will never dip to the level of their current mortgages, will acquiesce to a narrowing differential and see 6.5% interest rates as palatable/fair.
D) The forgoing will feed inventory levels and induce higher liquidity in the marketplace. FOMO will ensue…it’s the New York way…more and more people will jump in.
Conclusion: Overwhelmingly, brokers believe demand will be strong. People have been holding on tight, avoiding the extreme increase in affordability brought on by a move; however, life happens and they have to move (kids, 2nd kid, 3rd kid, kid goes to college, parent gets a new job, divorce…you name it). This will produce inventory and buyers will emerge. Which force will overpower the other, the supply of apartments coming on the market or the number of buyers looking, is yet to be seen. Regardless, deal volume will escalate and put pressure on prices to follow.
And oh yes, it’s an election year…and what an election year it will be. “Typically” it materializes into a “much ado about nothing” scenario. As we approach late summer, buyers become uncertain about what is going to happen politically; so deal volume temporarily slows or outright pauses. But, regardless of who wins, the moment the election is determined, the market continues on, as if nothing ever happened. There actually tends to be a bit of a bump immediately afterward, as the pent up pause that occurred works its way through. Question is, will this unique voting year be different?...Hmm…time will tell.
My take: For buyers, there is a wonderful small window right now, for the next 4-5 weeks which will likely prove to have been an extraordinary time to identify a good property. Conversely, Sellers can actually afford to be patient during this time period and prepare their properties for that moment when the marketplace becomes more active, mid/late February and into the Spring. But don’t sit around, literally prepare it for market…declutter, paint, detail, stage, get great photos etc.
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I always say: 1) Anyone interested in buying or selling, should be rolling up their sleeves to determine whether the time is right to sell or if there's a home/investment property out there for them; and 2) Who represents you matters…your best investment is often in the broker you choose; find someone with experience, who you feel you can trust.
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* M A N H A T T A N - M A R K E T N E W S *
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* H A M P T O N S - M A R K E T N E W S *
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Summer is around the corner. Whether seeking a seasonal rental or a secondary home, you must strategize prudently. Seasonal shopping seems to be back to pre-pandemic times. Inventory pressures have eased and there seems to be a bit more time to absorb what's out there. As people may be focused on primary residences in Manhattan right now, deal volume is expected to still be moderate out East. There should be some good opportunities; however, identifying them will likely take some diligence.
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As a buyer, you need to know how to identify the right opportunity and when it makes sense to jump in...or not. Everyone's circumstances are unique. Like Manhattan, one needs good representation to successfully maneuver the nuances that exist in this unique marketplace. Let me know if you need help.
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* CONNECTICUT *
- A Glance at Fairfield County -
N E W C A N A A N
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The biggest story seems to be inventory...or the lack there of: |
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Excerpt: "Homes for Sale in New Canaan is 51, down -46.3%. This drop in inventory is being felt across Fairfield County at similar levels, with only 17 houses for sale in Darien and 19 in Wilton, down -46.9% and -40.6% respectively. Norwalk, which has had more than 600 homes for sale for most of the decade is down to 78 homes for sale, down -36.6%. If you talk to any realtor they are optimistic that the cycle will be broken this Spring and inventory levels will rise. The reasons cited range from lower mortgage rates to the shock of the revaluation. I say that inventory levels will remain unchanged in 2024 due to 2 factors: demographics driving demand and lagging price appreciation. There are still too many buyers chasing too few houses, so while inventory remain tight and sellers will be reluctant to list if they cannot buy leading to inventory remaining tight. The second factor is related to the replacement cost. While housing prices have risen 25% in the past 5 years labor and materials and land cost has risen more. Many would-be sellers in New Canaan, happy with the price they can get for their home, are unhappy with its purchasing power in Boca Raton, Hilton Head, Austin, Vero Beach and Nashville." Read the full article here.
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A weekly podcast on real estate in the tri-state area,
around the country and even globally.
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Thursday's from 3-4pm
See you then.
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* What representation looks like * |
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Click on each respective image to see video. |
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* MORTGAGE & INTEREST RATES * |
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Chart Courtesy: Wells Fargo |
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* Most Recent MARKET REPORTS * |
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The Latest Market Reports - Sales:
Second-Half 2021 Brooklyn Townhouse Report: click here
Other Markets:
Hoboken/Jersey City 3rd Quarter (2023): click here
Interactive Rent vs. Buy Calculator:
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These are great local resources, especially at times like these. Here are some of the best and most comprehensive neighborhood blogs that are helping to keep us informed. Click on each. |
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With Patch you can choose New York City; however, they also have more concentrated areas categorized as follows: Central Park, Upper West Side, Upper East Side, Midtown-Hell's Kitchen, Harlem, Astoria-Long Island City, Chelsea, Gramercy-Murray Hill, West Village and East Village.
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Women Dressing Women
Through March 3, 2024
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"The Costume Institute's fall 2023 exhibition will explore the creativity and artistic legacy of women fashion designers from The Met’s permanent collection, tracing a lineage of makers from the turn of the twentieth century to the present day by highlighting celebrated designers, new voices, and forgotten histories alike.
Women Dressing Women will feature the work of over seventy womenswear designers, spanning ca. 1910 to today, including French haute couture from houses such as Jeanne Lanvin, Elsa Schiaparelli, and Madeleine Vionnet, to American makers like Ann Lowe, Claire McCardell, and Isabel Toledo, along with contemporary designs by Iris van Herpen, Rei Kawakubo, Anifa Mvuemba, and Simone Rocha.
A catalogue, published by The Met and distributed by Yale University Press, will accompany the exhibition.
The exhibition and catalogue are made possible by Morgan Stanley."
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The Hottest Restaurants
Open Right Now
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Fish at Tolo. | Matt Dutile/Tolo |
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Eater's Heat Map (click below) - Some of the Hottest Restaurants open right now:
Eater editors get asked one question more than any other: Where should I eat right now? Here, we’ve put together a map of the latest Manhattan debuts drawing NYC’s dining obsessives.
New to the list in January: Tolo, a wine bar with Chinese food; Hen House a fast-casual Lebanese spot with a late-night menu; Figure Eight, from the owner of Silver Apricot.
For more New York dining recommendations, check out the new hotspots in Brooklyn and Queens.
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Cookbook Author, Culinary Journalist and Food Humorist©, Rob is a Manhattan born man-about- town who writes, produces and hosts programs about food. I highly recommend his new book for Dads like myself. There is a new kind of dad, and he's doing far more domestic duty than at any time in history, including cooking. Although it's written with a sense of humor, this book is a serious resource for dads and anyone else interested in upping their game to make great tasting foo d bat home, even if they have never used a chef's knife or a roasting pan before.
Upcoming Courses include:
Note: These are live, virtual courses hosted by Roundtable, which include interactive opportunities and post-course recordings available for all course participants.
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Rob is also on iHeart Radio & SPOTIFY with his ALL YOU CAN EAT podcast about delicious food, cooking and luxury travel.
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PRIVATE ONLINE COOKING CLASSES:
Ask Rob about his privates…by which he means that he offers customized cooking lessons to individuals and to groups. You learn, you laugh, and you eat well.
Now that ALL of us need to pitch in when it comes to feeding the family, I suggest picking up some serious tips from Rob. As he says, he went to cooking school so you don't have to. These sessions are fun and literally provide prized skills for upping your game. Enjoy. See Rob's intro here.
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New York City * The Hamptons * Palm Beach
Connecticut * Miami
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With Partnering Worldwide, Brown Harris Stevens continues to leverage its very productive relationships with top brokerages nationally and internationally by inviting partners to high- light key properties in their respective markets on BrownHarrisStevens.com, and to feature our important properties on their sites. Learn more.
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With Partnering Worldwide, Brown Harris Stevens continues to leverage its very productive relationships with top brokerages nationally and internationally by inviting partners to high- light key properties in their respective markets on BrownHarrisStevens.com, and to feature our important properties on their sites. Learn more. |
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- Recognized by New York Magazine & Five Star Professional as one of the "most accomplished real estate professionals in New York City."
- Ranked nationally by REAL Trends as one of "America's Best Real Estate Agents" for avg. sales price of $4.350M.
- Recognized member of the 2016 "TOWN Elite" class
- Sold a single family Townhouse faster than any other on the Upper West Side over $10M to date. (StreetEasy)
- Certified Negotiation Expert (CNE)
- Trivia: Won the 2015 New York Times NCAA Basketball Pool.
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Roberto Cabrera
Licensed Associate Real Estate Broker
New York City * The Hamptons * Palm Beach * Miami
rcabrera@bhsusa.com
o: 212-906-0554
m: 917-701-3907
Clubhouse: @cabrera_roberto
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Brown Harris Stevens
1926 Broadway
New York, NY 10023
(917) 701 3907
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Disclaimer: The opinions and content in this newsletter are assembled solely by Roberto Cabrera (a licensed real estate broker in New York State) for informational purposes only and and is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No financial or legal advice provided. No statement is made as to the accuracy of any description or measurements (including square footage). This is not intended to solicit property already listed. All Coming Soon listings in NYC are simultaneously syndicated to the REBNY RLS. Equal Housing Opportunity. Everyone has unique circumstances and should consult the their own respective professionals.
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