Elegran Market Update: April 2020

Written By Jared Antin | April 13, 2020 | Published in Real Estate Market Trends, NYC Lifestyle
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The effects of COVID-19 on the New York City housing market have been profoundly felt in both supply and demand. Elegran data for the month of March reveals that, with a state of emergency declared by Governor Andrew Cuomo on March 7, the number of new listings of homes, both in the rental and sales markets, fell steeply in response:

  • - March saw 4,700 resale listings on Market, -18% from 2019
  • - Contract Activity, 576 Contracts Signed in March, -26% year over year

The first week of March saw as expected buyer activity but, as the COVID-19 crisis escalated, stock market volatility increased and the PAUSE order was issued. This confluence of events caused the real estate market to hit a wall in the second half of the month.

Prices remained largely stable in March with minimal change in median sales price or price per square foot. When the deals currently being negotiated begin to close in 3-6 months, the true effect on prices will be more apparent. Prior to the COVID-19 crisis escalating, the sales market in Manhattan was experiencing an uptick, with strong buyer activity and a rising supply/demand ratio.

While many economists agree that we are now in a recession, the fact is that a recession does not mean a housing crisis or “crash” similar to the one experienced in 2008 and driven by the stock and housing market crashes; a recession doesn’t necessarily even lead to a depreciation in home prices.

This crisis is an event-driven one, historically easier to recover from, similar to 9/11 after which, in 2001, 2002 and 2003, home prices in Manhattan actually appreciated by 9.5%, 2.1% and 6.1% respectively.* (Miller Samuel).

With this in mind, and the pandemic being measured by the hour, we seek to educate, inform and look to the future beyond COVID-19 with an even deeper understanding of what the importance of home means for all of us.

Here is what else you should know:

BUYERS
The window of opportunity to get a “deal” is likely later this spring and summer. With buyer hesitation high, there will be less competition for properties, at least in the short-term. Buyers, in some instances, are finding opportunities to strike a deal that a seller would not have entertained just a few short weeks ago.

FIRST-TIME HOME BUYERS
Use this time to get educated on the buying process. Have a consultation with a buyer’s agent, browse listings online, view virtual tours, get pre-approved and speak to a financial advisor to understand how much you can afford and tax benefits.

SELLERS
We expect the market to be thinly traded in the short term. Patience is important. If you don’t need to sell today, you will likely be better off waiting as we expect a return of buyer demand when the crisis subsides. Use this time to spruce up your home as you can, so you can be ready to come back to market well positioned and ready to sell..

RENTERS
Landlords are guarding against a potential increase in vacancy this summer and many are offering to renew leases at no increase in order to keep tenants in place.

INVESTORS
Those looking to purchase an apartment to rent out have an opportunity to buy “virtually” or “sight-unseen”, and the economics may make sense if they can strike a good deal given the decrease in buyer activity at the moment, and if the seller is motivated. 

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This information is not verified for authenticity or accuracy and is not guaranteed and may not reflect all real estate activity in the market. © 2020 REBNY Listing Service, Inc. All rights reserved. RLS IDX Data display by Elegran LLC. IDX information is provided exclusively for consumers’ personal, non- commercial use and that it may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.

Elegran LLC may or may not be the exclusive listing agent of the properties being displayed on Elegran.com. All data displayed on Elegran.com is presented for informational purposes only and should be independently confirmed by all customers. All Information is compiled from both public and private sources including, but not limited to the RLS, MLS and ACRIS; each of which is assumed to be reliable. All information displayed is subject to errors and omissions regarding apartment specifications and final sale prices, and further, any unit listed may have had its listing withdrawn without notice subsequent to such information being compiled. No representation is made as to the accuracy of any description (ie: listing, close sale data, and/or building description) of any building or individual unit. All measurements and square footage are approximate and all information herein should be confirmed by customer and/or their attorney. Elegran LLC, its members, affiliates, and contributors adhere to New Your City, New York State, and United States Fair Housing Laws.