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Prices are up, inventory is low and the market is ultra-competitive
Limited inventory is the theme in the sales market this spring, particularly for those who cant afford to spend $3 million and up, experts said.
If youre looking to buy new property for under $2 million, Manhattan wont have it.
Its definitely competitive, Gary Malin, president of real estate group Citi Habitats, said of the spring sales market. Theres lots of bidding wars going on, lots of best-and-final [offers] going on.
In other words, few apartment hunters are getting their first choice these days.
Inventory in Manhattan in the first quarter of 2014 declined by 17% from the first quarter of 2013, according to a Citi Habitats sales market report; apartments priced between $2 million and $5 million made up 16% of total sales in the first quarter of this year, up 2% from the year before.
If you want to find something soon and cant afford multimillion dollar listings, look outside of Manhattan, where prices are lower but steadily rising. Or, wait about 18-24 months for more options, Malin said.
Theres the market above $3 million, which is where all the new inventory is being produced, Yuval Greenblatt, executive vice president at brokerage Douglas Elliman, said of Manhattan. Then you have the market below $3 million, where its basically void of any new product.
The average sales price for a condo in Brooklyn in the first quarter of 2014 was $734,000, up 8% from last year but still well below $1 million, according to the Real Estate Board of New York.
Despite rising prices and low inventory, the sales market is getting increasingly more competitive, thanks in part to low interest rates. New York Citys population continues to rise, and people still want to buy property here, making the sales market even more competitive.
The average rate for a 30-year fixed loan declined from 4.5% in July 2013 to 4.375% on April 15, 2014, according to the Association of Mortgage Professionals, and the average for the 15-year mortgage decreased from 3.83% in July 2013 to 3.47% on April 15, 2014.
Interest rates continue to be low, our population is rising and we continue to do things that make it possible and desirable for people to want to be here, Mike Slattery, senior vice president at REBNY, said of city buyers.
Plus, we are still the safest, largest city in America, he said.
If youre looking to buy in Brooklyn, Greenblatt said Downtown Brooklyn, near the Barclays Center, and Fort Greene will have large new buildings opening soon.
As for Queens, keep your eye on Long Island City, where mostly rentals opened in recent years but condo developments are on the way.
But act soon, as the average sales price for a condo in Queens rose 5% in the first quarter of 2014 to $456,000 from last year, according to REBNY.
Steve Rutter of real estate brokerage Stribling agreed that Brooklyn will continue to be hot, particularly Williamsburg and the brownstone neighborhoods of Cobble Hill, Carroll Gardens and Brooklyn Heights.
Brooklyn sales inventory was down 4.1% in the first quarter of 2014 from the last in 2013, according to a report by Douglas Elliman, so apartment hunters will have to do their homework.
Rutter offered a tip: 345 Carroll St. in Carroll Gardens will be chock full of new two-, three- and four-bedroom apartments.
If you can spend a little more and want to live in Manhattan, he said to keep your eye on the 57th Street corridor, which will boast new high-rises on the east side.
Also in that area, 220 Central Park South will open sales soon, along with 432 Park Ave.
However, Rutter said, be warned: Those buildings cater to the ultra-wealthy.