Condominium sales in Manhattan plummeted by 84 percent in May as the COVID-19 pandemic and protests following the death of George Floyd at the hands of the police have chilled the real estate market.
CNBC, reporting on data from UrbanDigs, the New York-based analytics provider for Manhattan’s residential real estate market, found that there were 160 purchase and sale contracts signed last month in the city, compared to 992 in May of 2019.
While transactions fell, the number of new properties listed for sale in Manhattan dropped to 574 in May compared to 1,970 one year ago, a 71 percent dive, as sellers wait for the market to show signs of improvement.
“I have a lot of people waiting to sell and a lot of people waiting to buy,” Lauren Muss, a broker with Douglas Elliman, told the network. “It’s a question of when we can do business again.”
The largest sector taking a hit in Manhattan are luxury condos, as an oversupply of these pricey new units are already weighing on prices, CNBC reported. Only 16 units priced at $4 million or more were sold in May, for a total of $100 million. That’s down by nearly 90 percent from the same month in 2019, when there were 111 units sold for a total of $1.1 billion, according to the Olshan Realty Inc.’s Luxury Market Report.
UrbanDigs’ analysis found that while sales were down sharply in Manhattan, demand increased in Westchester County in New York, as well as nearby Greenwich, Connecticut and in Bergen and Monmouth counties in New Jersey.
“In the near term, continued slack demand for Manhattan could create an oversupply situation, implying lower prices ahead, and increased suburban demand could create a supply crunch, pushing up prices,” the UrbanDigs report said. “In the meantime, it remains to be seen if the easing of stay-at-home restrictions in Manhattan will unlock pent-up demand, but with the move to the suburbs already in place and further entrenched by the COVID-19 pandemic, any pickup in Manhattan demand seems unlikely to reverse the trend.”
New York’s drop in sales is in contrast to the most recent mortgage application data from the Mortgage Bankers Association (MBA). Fueled by the lowest home loan rates in the nation’s history, home loans saw a 18 percent increase for the week ending May 29 compared to the same week one year ago. Rates for 30-year, fixed rate loans were 3.15 percent, while the 15-year fixed mortgage was 2.62 percent, according to Freddie Mac.