April 2015 Manhattan Condo Market Report: Record Volume of New Condo Listings

With condo resale prices hovering at record highs, inventory stuck at near-historic lows, and persistent and fierce competition among buyers, the Manhattan condo market remained a seller’s market in April. After a disappointing first quarter in which total Manhattan inventory fell to its lowest quarterly level in five years, a small boost to available condo units and softening prices in April pointed to a more buyer-friendly market this spring.

The total number of condo units available for sale increased to 3,623 in April, an increase of 3.9 percent from March. The increase was due in large part to a surge in newly-listed units in March as sellers strategically waited to bring their units to the market during the peak of the busy spring season. There were 930 condo units newly listed in April, the largest monthly volume on record according to StreetEasy. Roughly one in four of all condos on the market were newly listed in April, the highest share of total inventory on record. Despite the welcomed monthly increase, total inventory remained 6.7 percent below last year’s level.

The recent boost in available units helped to halt price growth among Manhattan condo resales in April. According to the StreetEasy Condo Price Index, resale prices were flat from March, the first time in 28 months that prices failed to post monthly growth. In a potential sign of further softening in the future, condo resales in the Downtown and Upper East Side submarkets saw price depreciation in April, declining 0.4 percent and 0.2 percent from March respectively. Condo resale prices are expected to fall 0.1 percent in May, according to the StreetEasy Condo Price Forecast. The median sales price declined 6.3 percent from March and 5.2 percent from this time last year. While not controlling for changes in the mix of inventory, the decline in median sales price from March signaled slowing price growth.

Pending sales volume in April increased 6.1 percent from March and closed the month 12.5 percent greater than last year. With the median time on market falling by 3 days in April from March, our advice to potential buyers remains the same: run – don’t walk – to that open house. The median time on market remained low at 48 days but nowhere near the historically frenzied pace experienced in April of last year when homes sold in just 39 days.

Will the price softening in April turn into a trend in the Manhattan condo market, or is this a short- term blip? The answer depends ultimately on the direction that inventory moves in the coming months. This market remains starved for more inventory as demand far outpaces available supply of condo units. A long-term correction in prices requires more inventory to enter the market, which has largely been elusive over the last three years.

Download the full pdf report here.