We hope that everyone is enjoying the beginning of summer and we, at The LevinKong Team, want to wish everyone a very happy and safe Independence Day.
While we are certainly starting to feel the summer heat in the city, the market is beginning both its seasonal cool down associated with this time of year, as well as a cooling off in activity in general throughout most of the market. Overall, we’re seeing the emergence of a buyers’ market with some notable exceptions; downtown Manhattan is faring better than uptown, and the Queens and Brooklyn single and multifamily house markets are still incredibly competitive. In these segments of the market, cash-buyers and bidding wars are still very much alive.
In speaking with our clients and buyers throughout the market, the federal tax overhaul and its negative implications for our local market appear to be the main cause for buyer hesitancy. The first quarter of 2018 marked the lowest sales quarter total in over six years. Although we had success selling appropriately priced and unique properties – despite the overall strong local economy – buyers and sellers differing expectations on where proper value exists have resulted in a slowdown. This means there is significant opportunity for buyers who have strategic guidance.
Interest rates – while still historically low – and their inevitable further rise, are also having an impact on the market. The consensus among most economists is that any rate below 6% is good for the housing market and we are still trending in the high 4s. The Federal Reserve raised its benchmark rate for the second time in its June meeting; the group meets again starting July 31, but rates are not expected to increase during the meeting. The hikes are expected to occur in September and December, which will spur some buyers who have been on the fence to jump in before this occurs. This will most likely be felt in lower price points, which have been outperforming higher price points in general.
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.