With September wrapped up, we are now fully engaged in the fall market. Historically this is one of the most active seasons in NYC real estate. Although it hasn’t felt like fall weather quite yet, we are seeing signs of the market gaining the momentum that is associated with this time of year. Demand has not waned from a summer market that was particularly active.
What we have not seen, thus far, is the high level of listing inventory that typically hits the market after Labor Day. While inventory did bump up from August levels, it was not to the same degree that we are accustomed. That is particularly true in the lower priced segments of the market, where competition among buyers is strongest.
Days on market, average listing discount, and median sales price remained relatively unchanged from August to September. As we enter October, we expect these positive indicators to marginally creep up; however, the market is relatively flat at present and, in general, has normalized after the post-election lag. As we have been reporting for some time, the market is still skewed in favor of sellers in the lower end and towards purchasers in the higher end. This does vary to some degree between differing ‘micro-markets’ .
One trend which has become increasingly noticeable is the shrinking pool of cash buyers. For several years it felt like cash buyers were the norm and buyers that were financing had to go to great lengths to have their offers heard. Hand in hand with the drop-off in all-cash buyers is the larger pool of prospective borrowers and banks are competing for this business.
Despite tougher lending guidelines put in place after the financial crisis, banks are looking to use home loans as a vehicle to attract new depositors to their banks. Besides offering incredibly cheap money, many banks are loosening their lending policies and focusing on the relationship with the client to determine their appetite for loans that would otherwise not have been issued over the last several years. Whether it is an issue with the borrower’s credit history or income, or an issue with the condo or coop that the loan is securing, banks are taking a broader look at the overall economy and a common sense view of the safety of the loan. We are not in the free-for-all days of the mid 2000’s that lead to the financial crisis, by any means, but the easing in the flow of money is helping many first time home buyers and self-employed individuals make purchases that would otherwise have been difficult.
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.