Since COVID first hit, most regions of the country experienced a seller’s market. Many people needed to move in a rush and were suddenly open to locations they never would have been able to consider before. As a result, sellers across the country were getting top dollar for their properties, and getting offers in record time. This was the norm in most markets—except New York City.
The ever-present demand to live in the epicenter of it all was suddenly on pause, creating an unusual situation in Manhattan. There was suddenly far more inventory available than demand, driving down prices significantly. Plenty of people took advantage of this and moved back to New York (or upgraded to a bigger apartment or different neighborhood) for an unheard-of price during the pandemic. But by 2021, with a new administration in office and vaccines beginning to roll out, people saw the light at the end of the COVID tunnel and began migrating back to the city. In January and February alone, there were 2,472 contracts signed in Manhattan—more than in ANY previous year since the 2015 peak—and a clear sign that things were about to shift. In fact, there were twice as many contracts signed in Manhattan and Brooklyn January 2021 as in January 2020, suggesting demand is even higher now than it was before the pandemic. That tells us two things:
1. Never bet against New York City
2. If you’re just starting to consider moving back to or into New York City now, you may have missed the market.
So, what should home-buyers and their agents do as New York shifts back into a bull market? Expect challenges, and act fast. Spring is always a busy season, but more so now that all the buyers who hibernated during COVID suddenly emerged and started looking at once. Agents need to expect that their buyers will be discouraged; Every house available is selling fast—especially those in desirable buildings, neighborhoods, and school districts. We’re seeing a lot of bidding wars and low days on market, further proving that the power no longer is with the buyer. Getting your client their dream home in this new market will be a much tougher task than it was just a few months ago.
COVID put the value of real estate—both in terms of a safe home and a safe investment—at the forefront again. People who hadn’t made a move since the recession of 2008 were suddenly buying and selling again. New York City was sitting on tons of inventory, and many people swooped in last year to buy it while interest, asking prices, and mortgage rates were low. Now, all that’s changed, and we’re about to shift into a bull market unlike any we’ve ever seen. So, if you or your client plans to buy a home this spring, get ready to act fast, be flexible, make strong offers, and expect some disappointment. In challenging markets, an experienced agent with strong connections can help you navigate these issues and find the best possible deal.