Text by Michael Comandini, Photos by Jason T. Jaskot
To say it has been an interesting year for Manhattan’s real estate market would be putting it lightly. The new tax code, higher property taxes, and rising interest rates has buyers seeking better deals. The results: lower sales volume, increased inventory, decreased sales prices, and increased buyer negotiation power. This correction is market wide, across all price points and ownership types, making it the perfect time to be a buyer. But where are the best deals and biggest discounts?
When deal seeking, the two main criteria to consider are price and location. An oversupplied market has increased negotiability across all price points, but it’s the homes in the $3MM – $5MM range that have been giving the largest discounts. On average, sellers in this range have been letting their homes go for 6% off their last asking price. This is substantial, especially when compared to the 2% discount in the under $1MM sector, 4% in the $1MM – $3MM sector, and 5.5% in the higher end market. The $3MM- $5MM sector is defined as mid to large-sized luxury properties largely consisting of 2 – 3 bedrooms. Let’s look deeper into this sector and add see which neighborhood is discounting the deepest.
Although developers have been offering buyers great incentives, it’s the resale market that has been realizing the best deals. The highest discounted neighborhoods in the $3MM -$5MM resale market are the Upper East Side and Downtown. In the UES, price per square foot levels are down 14% year-over-year. This is largely due to the double-digit inventory level increases. Buyers have been securing a median discount of over 8%. Downtown, which has been notorious for drought-like inventory levels and record-breaking prices, is now seeing the largest discounts. With a cooler market, the area has gained a more than healthy level of supply in the mid-level luxury market. With demand unable to absorb this higher supply, median price per square foot in this sector has tumbled by 14%. Buyers have been able to score an incredible median listing discount of 8.5%! Many of these sellers are letting go of their homes at double digit discounts just to get the deals done now.
If you are considering a purchase in New York City, now is a great time. Not only are prices down, but the negotiability levels are so high buyers can now set the new low.
Michael Comandini is a Licensed Associate Real Estate Broker with the Comandini Team at Keller Williams. He resides in New York’s Lower East side with his French bulldog, Churro. He can be reached at firstname.lastname@example.org or through ComandiniTeam.com