Taking Control
This past month in the city we saw an increase in property transactions that fell out of contract, reaching the highest level since the initial wave of the Covid pandemic. Specifically, deals under $800,000 have seen the highest fallout rate. The interest rate on the average 30-year fixed mortgage has doubled in the last 12 months, impacting buyer purchasing power. Lower earning, lower net-worth buyers – typically first-time buyers – are feeling especially pinched in this market, with their dollar now able to achieve less, and less dollars left since the stock market downturn to qualify for financing.
The contract cancellation rate is relative, still only a minor portion of contracts, around 1.7%. But there are inferences that offer potential to some buyers. Buyers hunting for property at and below $800,000, those impacted most, are seeing the most properties come back to market. Contract fallout can often be attributed to buyers not being able to perform on obtaining a mortgage that they had originally qualified for before the rate and market impact. Some of their peers are now unable to buy, and others are apprehensive with interest rate and market conditions. They’ve slowed down or stopped their search altogether.
We are still experiencing a balanced market, owed much to inventory that continues to be lower than consumption demand. But now with longer time on market and more negotiability, coupled with the oncoming holiday season and self-sidelining buyers, we see that pickings exist for those who are willing to remain in the trenches. In addition, if you are a buyer who is exploratory and considering a broad range of neighborhoods, learn which are experiencing the most notable increases in inventory to your advantage.
We suspect many buyers will regret their indecision right now. Too many are pulling back without understanding creative lending options that ease their constricted budgets and put them in control, rather than feeling like they are being thrown around by market conditions.
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The Numbers
Manhattan Market Activity
Highlighting our market's past 30 days
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The Properties
Our month's featured listings on the market.
Brooklyn Heights / Brooklyn
2 Beds / 1 Bath
Coop
$1,175,000
Kensington / Brooklyn
Upper East Side / Manhattan
1 Bed / 1 Bath
Coop
$745,000
Williamsburg / Brooklyn
3 Beds / 2 Baths
Townhouse
$2,695,000
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The Pick
From the cool and eccentric to reserved and irreverent -
Our month's pick of what's happening in New York City.
If you haven't already, you should:
Now through March 26, 2023
