For an area of the city with such an outsized global reputation, Manhattan has shrunk to a shockingly small real estate market. When it comes to home buying opportunities, the Big Apple has turned into the Extremely Small, Highly Priced Apple.

The Manhattan real estate market showed modest price growth in the first quarter of 2015 as inventory dwindled to its lowest point ever, according to StreetEasy records. Historically, inventory increases slightly during the first quarter of the year from the preceding quarter. Not so this year: The number of homes for sale was 0.6 percent less than last quarter and 2.3 percent less than last year. Just 10,243 units were available for sale throughout the quarter, adding more importance to strong inventory growth expected over the second quarter as buyer demand ramps up in the busy spring months.

The median sales price of all homes increased by 5.2 percent from last year to nearly $946,000. Driven by a changing mix of properties as well as market price trends, this marks the third consecutive quarter of positive annual growth in median sales price in Manhattan.

Prices among condo resales, which accounted
 for 55.4 percent of all condo sales in the first quarter, appreciated by 1.95 percent over the quarter, according to the StreetEasy Condo Price Index. Condo price appreciation in the Midtown submarket outpaced the rest of the borough over the first quarter, climbing 3.5 percent. Although Midtown is hot on its heels, the Downtown submarket remained the highest priced in the borough in the first quarter, remaining well above every other submarket. Condo price appreciation is expected to continue in April, according to the StreetEasy Condo Price Forecast, which predicts an increase of 0.5 percent in resale prices from March.

Despite growing prices and tight inventory, demand for Manhattan real estate has proven resilient. Sales volume in the first quarter increased 2.6 percent from last year in a sign that some buyers are not to be discouraged by shrinking inventory or price growth. Sales of condos and co-ops grew by 1.5 percent and 2.7 percent from last year, respectively. The median time on market for all Manhattan homes sold in the first quarter rose slightly from 58 days to 60 days during the same quarter last year. Heavy competition for limited sales listings will favor sellers this spring. Expect the supply-demand imbalance to drive price growth into the spring months and keep time on market relatively short.

The good news for buyers: the second quarter almost invariably brings a surge in new listings as homeowners wait for March and April to sell their properties. Buyers’ patience may be rewarded by more options in the near future, but they will likely not come at a lower price.

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