Manhattan Monthly Sales Report: September 2023

Contract Activity Cools While Days on Market Continues to Rise

September 2023 underscores a cooling Manhattan real estate market, with pronounced contractions in contract activities and adjustments in listing prices. While luxury segments display modest vitality, broader market indicators point to lengthier sales periods and a cautious approach from sellers, prompting inventory constraints and continual price recalibrations.

Contract Activity Experiences Significant Dip:

  • 19% decrease year-over-year and a 28% drop compared to the previous month.

  • Lowest activity since September 2019, with only 620 contracts signed, excluding the 2020 market pause period.

  • Influencing factors include higher mortgage rates and seasonal disturbances (Labor Day, Jewish holidays, school year onset).

Luxury Market Resilience:

  • Exclusive surge in contracts over $5M, with an increase by three sales from the previous year.

Extended Marketing Times:

  • Days on market escalating: up 20%, marking the eighth consecutive month of double-digit rises.

  • Current average stands at 151 days — a full 10 days beyond the five-year average for September.

 
 

Inventory and Pricing Adjustments

In September 2023, Manhattan real estate listings fell to a six-year low, despite a slight increase from August. Economic pressures led to a 5% drop in square foot pricing and a significant decline in ultra-luxury sales. While average discounts on final asking prices tightened slightly, condos saw deeper price cuts compared to co-ops. Overall, a smaller percentage of properties sold below asking price than in the previous month, reflecting subtle market shifts amidst a backdrop of cautious buyer sentiment.

Inventory Levels Tightening:

  • 3% decrease in active listings year-over-year, despite a 4% rise since August.

  • At 6,500, the lowest September inventory since 2017 due to hesitant sellers.

Price Corrections:

  • Average price per square foot declines to $1,781, down 5% annually.

  • Notable contraction in high-value transactions, especially in Downtown area and ultra-luxury segment above $4,000 per square foot.

Negotiability Factor:

  • Discounts narrowing to an average of 3.8% off the last asking price.

  • Condos facing steeper price cuts with 4.7% discounts, while co-ops showed lesser negotiability at just under 3%.

  • 65% of sales concluded below their last asking prices, indicating a 5% negotiating advantage reduction from August 2023.