New York City's housing market is heating up again on the back of lower mortgage rates, marking the worst start to 2021 since 2021.
According to a report from property information portal StreetEasy, there was a significant increase in activity in September, with 1,676 units under contract, a significant 26.4% increase compared to the same period last year.
Momentum grew each week, with 349 trades in the first week of the month and 441 trades by the last week. Manhattan has been at the forefront of this boom, recording 726 new contracts, an increase of 28.7% over last year.
Among the neighborhoods, the Upper East Side stood out, with closings increasing 39.2% to 167 homes. The report said the luxury goods market, which has been relatively stagnant in recent months, is finally regaining momentum, mainly due to lower prices.
In September, the starting price for luxury homes in the city (defined as the top 10% of properties) fell to $4.7 million from a peak of $4.95 million in December 2023.
Due to this price drop, the number of contracts for luxury homes reached 70 last month, compared to 46 in September 2023.
Of those, 64 were in Manhattan.
The luxury home segment of the market is expected to remain strong in October, with last week seeing the highest growth in luxury home transactions in nearly three years, according to Olshan Realty.
Contracts were signed in just seven days for 13 trophy houses priced at more than $10 million. New properties in the luxury category also increased by 7.9% year-on-year, providing more options for buyers looking to invest in prime real estate.
Analysts at StreetEasy say both the increase in new business and the number of listings will lead to a slowdown in the luxury goods sector after a sharp slowdown in 2022 and 2023 amid rising borrowing costs and volatile financial markets. This indicates that the outlook for the future is improving.
For buyers with deep pockets, now appears to be the time to strike, as falling prices and increasing availability signal a potential tipping point for the urban luxury market.
