A flood of new homes went up for sale in New York City in July, but other indicators — including pending sales and off-market price negotiations — show the city’s sales market in the midst of a major slowdown, according to StreetEasy’s July 2020 Market Reports.
Citywide, the total number of homes for sale in July was six percent lower than last year. But following the Phase 2 reopening of most real estate activity in NYC, a record high 2,714 new listings came onto the market in Manhattan. That’s an 87 percent increase over July of last year — a surge in inventory akin to what’s typically seen at the start of home-shopping season in April.
Yet while sellers have begun to return to the market, July data shows that many of them are not meeting the price points buyers have in mind.
This July, 37 percent fewer Manhattan homes went into contract than in the same month last year. For those homes that did change hands, the difference between what sellers offered in discounts and what buyers actually paid reveals a market that is still adjusting to a new reality.
Only 14.5 percent of Manhattan sellers offered a discount in July, at a median amount of 5.2 percent. But the homes that went on to close after off-market negotiations sold for a median of 10 percent, or $117,000, less than their initial asking price.
This difference between initial asking price and final closing price is the largest ever recorded by StreetEasy, going back to January 2010.
“COVID-19 has exacerbated the weakness in the Manhattan sales market. If the sellers that have returned to the market are serious about making a sale, they will have to lower their prices accordingly,” said StreetEasy Economist Nancy Wu.
“Very few homes on the market are getting significant price cuts, even though the small pool of successful sellers are accepting offers well below their initial asking price,” Wu added. “Once this reality sets in, asking prices will inevitably begin to mirror what we’re already seeing in off-market negotiations.”
Manhattan prices fell 4.2 percent year-over-year to $1,450,000. Prices dropped the most in the Upper West Side submarket, declining 5.8 percent. The median asking price of $1,499,000 was the lowest recorded since 2014. Homes lingered on the market for a median of 144 days — 68 days longer than last year.
Brooklyn prices fell 2.1 percent year-over-year to $969,000. Brooklyn sellers accepted offers at a median of eight percent, or $62,400, less than their initial asking price — the largest difference on record. Sellers added 1,724 new listings to the market — a 50.3 percent increase over last year, and a record high for the borough.
Home prices in Queens bucked the citywide trend, rising by one percent. The median asking price in the borough was $650,000. Homes sold over a week faster (9 days) than last July, remaining on the market for 61 days. Similar to Manhattan and Brooklyn, Queens homes closed for record discounts compared to initial asking prices, with sellers accepting offers 6.3 percent, or $32,287, lower than their initial asking price.
View all StreetEasy Market Reports for Manhattan, Brooklyn, and Queens, with additional neighborhood data and graphics. Definitions of StreetEasy’s metrics and monthly data from each report can be explored and downloaded via the StreetEasy Data Dashboard.