The Manhattan Real Estate Market Is Changing. Here's How to Respond.
It’s official: the market has changed. We are consistently seeing prices drop across the board, and the real estate market is no longer “frothy.” Don’t get me wrong - a well-priced apartment in a limited inventory market is still moving, and those open houses are busy. But far and wide, the market has slowed, and as a result both buyers and sellers will need to adjust their strategy. Here are my top tips for both sides of the table:
Yes, the market may continue to slide, but there are great opportunities now. And even if the market does continue to inch back into more palatable price points, eventually it will rebound, and you’ll be the smarty who bought when there was an opening. Odds are you’ll live through the continued dip, and make it out the other side doing just fine.
Don’t be afraid to bid a number below the asking price.
Many of us (brokers) are constantly having the two “Tough Conversations” with our sellers, which are that we (as sellers) need to both entertain all qualified offers, and if we have no offers, we need to drop the price. If you, as a buyer, make an offer to a seller before they drop the price to the right number, you might be able to obtain the home for a good price before it receives additional interest at a lower price.
Explore the market!
There are new opportunities out there. For instance, developers are beginning to sell what they call “attainable luxury”. You can now buy that brand new apartment in a nice new development condominium for $1,400 a foot, as opposed to last year’s $2,000 a foot. There are great one bedroom apartments available under a million (which means you avoid the mansion tax), so get out there and take a look.
Pricing correctly has always been something I’ve practiced and preached, but now more than ever (well, at least more than in the last five years!), you really need to create the market when you go online. Though it may sound counter-intuitive, you almost have to price below the market to sell above the market. It’s a scary thought, exposing your home to a below market price, but for the brave out there, it pays dividends.
Market like hell.
Make sure your broker has adjusted his or her approach and marketing process from reactive to proactive, and from passive to active. In years past, you listed an apartment and it sold so long as you didn’t do anything too foolish (insane price, bad marketing, etc.). Now, if your agent isn’t taking necessary steps to reach out to the buyer and broker community, your home is a sitting duck.
Either sell it or sit on it.
Some sellers want to “test the market” at a higher price. Nope, sorry, that’s just not where the market is right now. Either accept your fate about price and the realities of the current sales market, or wait it out. If you can rent out your apartment, that’s definitely an option to consider.
I hope you can apply these tips to your scenario. These are just a few (of many) thoughts I have about the new marketplace, and how to help my clients thrive within it. Feel free to reach out with questions, or if you want even more tips.