Spring is typically defined by an increase in pending sales amid the busy selling season, but the Manhattan condo market showed signs of easing in April.
The StreetEasy Condo Price Index (SECPI) – formerly known as the Condo Market Index – experienced the greatest monthly decrease (-1.4 percent) since September 2010. Although prices remain well above year-ago levels, the monthly decline in April is a reversal of the persistent price gains reported throughout 2013 and into 2014. This is a sign that prices may have reached their seasonal peak early and will begin to decline or moderate.
Very little movement in prices is expected in May, according to the new StreetEasy Condo Price Forecast (SECPF), signaling a relatively muted spring season punctuated by April’s decline.
Still, we are far from calling this a buyers’ market. Although April inventory saw a 6 percent monthly increase from March, it is still 2 percent below the year-ago level. With fewer options on the market, buyers who manage to find a condo must act quickly amid growing competition from other buyers. Median time on market remained 49 days in April, the same as March and one year ago. This brisk pace of inventory turnover points to a significant mismatch between supply and demand in the condo market.
Further complicating matters for buyers is April’s inventory mix, which skews heavily towards condos priced in the most expensive price segment (above $1.9 million). With nearly half (47.0 percent) of all listings priced in the top price tier, many buyers may be shut out of the market.
Overall, April data signals a condo market that may have peaked in terms of price but one that remains prohibitively expensive to enter. If the most expensive condos continue dominate Manhattan inventory, buyers will face mounting competition and fewer affordable options heading into summer.
