January marks the beginning of the year and the ‘soft opening’ of the busy selling season for the New York City real estate market. The start of the year is also a time when we analyze what occurred in the past year and look at what lies ahead. For The LevinKong Team, 2016 was a significant year as we entered a new partnership with Keller Williams Real Estate. In our first year of this new association, we are proud to have been recognized as the #1 Sales Team for Keller Williams by sales volume in our market center. We look forward to maintaining this level of service and production for our clients in the year ahead.
2016 was the year that our real estate market ‘normalized.’ After a five-year run of increasing home prices and fierce competition for the limited available inventory, supply increased and we saw fewer bidding wars and over-priced inventory stagnated in most segments of the market. Ambitious pricing has been replaced by realistic pricing and sellers that have not made the adjustment are seeing their days on market increase, up approximately 30% since last Spring. Deal volume was down in 2016 but we anticipate this to rise in 2017 with increased inventory and lower asking prices.
We are witnessing falling prices and increased supply most profoundly in higher price-points of the market and anticipate that this will persist throughout 2017. Prices of property and the speed at which they trade are most favorable for sellers in lower priced segments of the market. Particularly strong, is the market for properties priced under $1 Million. We have recently seen bidding wars in some of our listings in this market segment. This is due to a combination of factors, namely continued low levels of inventory and a first-time homebuyer pool concerned about increasing mortgage rates.
Although market volatility has led to some recent declines in interest rates, we expect them to continue their larger trend and edge up over the course of 2017. Along with rising interest rates, we anticipate a loosening of lending regulations. We have already seen the reintroduction of some no documentation loans and one of our preferred lenders, Citizen’s Bank, has introduced 90% total financing for condo property, something not available for almost a decade.
We will continue to keep you up to date on recent happenings and trends in the market. We hope that you find this informative and useful and, please, as always, reach out with any questions on how you can take advantage of these current trends or how to protect your real estate assets. Also, feel free to reach out with any questions regarding a specific trend or segment of the market. The LevinKong Team is available to serve all your New York City real estate needs and those of your friends, family and colleagues.