The one "booming" neighborhood in Manhattan

Nice little bounce.... We're seeing quite a bit of activity, our calendar is full. Our one rental listing on the upper East side now has nine applications, currently have seven accepted offers, two on townhouses in Brooklyn (keep an eye on our website to see how many get to contract). Showed the penthouse at 56 Leonard yesterday along with 90 Morton and 415 Greenwich.

I know we have a successful business model, but I'm watching the numbers waiting for them to catch up with what we're experiencing. Every signed contract is taking twice as long to complete. The majority of our business has been in Brooklyn, but we also have an accepted offer on a one bedroom on 181st Street, one on Columbus circle.

Keith

https://www.urbandigs.com/resale-charts/pending-sales/?agentid=9325

(Three bedroom on Columbus circle)

Keith, which penthouse in 56 Leonard did you show & what did you think about it?

Noah and John both expressed that ACRIS isn't showing sales being recorded at anywhere near the rate at which agents are reporting closings so that "Pending Sales" number doesn't reflect the actual number of units currently in contract. Yet it's still down 20% YTD and 11% YOY.

30, While there is clearly huge overhang of inventory as not much went into contract from late March to July, wondering what you think of the trajectory of pending sales in the last few weeks? I know your take is going to be bearish but I would appreciate it.

I made the digs chart 6 months to focus on last one month.

Nada: The buyer loved it.

For $100K per month you too can rent your very own ballerina: https://streeteasy.com/building/56-leonard/ph56

I guess that beats the $256K they were asking last year.

In the past 3 weeks you've got 1440 in new listings vs 501 signed contracts. That's in a time of both tremendous uncertainty and huge pressure from rental prices plummeting. Anyone who tries to spin that as a positive environment is a moron or a liar.

The above is obviously speaking to Manhattan numbers.

That art looks like it was purchased at one of those 'starving artists everything-must-go' sales the have at the Hilton Hotels in Westchester. All 'quality giclee' reproductions. :-D

^^talking about 56 Leonard

September 2008: 1525 new listings, 600 contracts signed
September 2009: 1827 new listings, 920 contracts signed

September 2020: 2196 new listings, 679 contracts signed

You can see the glass half full or half empty, I'm a half full guy. It's going to take some time, however we are seeing improvement's in the New York City real estate market.

If you're paying attention to the Friday vlogs that Urbandigs put out, both Noah and John have been pointing out these improvements in the market. We're not seeing a quantum leap, but we are seeing improvement.

“We’re peeling back the onion and getting to what the real market is,” Mr. Miller said, noting that, despite New York City taking longer to recover, it is, in fact, improving. And the market that is emerging could benefit first-time and move-up buyers, as well as renters who intend to live year-round in the city.

https://www.nytimes.com/2020/10/09/realestate/new-york-city-real-estate-return.html

Noah, Not sure if you are reading. Is there any way to get month to date contracts from digs in October? Pending sale increase naturally understates new contract signed due to closings. I can find contract signee data till the end of September. Thank you.

The stats cited on UD are second-order factors. A stat like "more contracts signed this week" suggests, at best, that the *rate* of price drops has slowed. But the *direction* of price movements won't change until new contracts and new listings are closer to balancing out in absolute terms, not just in YoY / MoM terms.

Can you imagine if stock brokers reported on volume the way RE brokers do? "Market is RED HOT, buyers are finding sellers faster than ever before!!" For the record, the top 20 days in S&P history, ranked by deal volume:
10/10/2008
5/6/2010
9/18/2008
11/21/2008
5/7/2010
9/16/2008
9/17/2008
9/19/2008
5/7/2009
3/18/2009
11/20/2008
3/20/2020
3/19/2009
2/27/2009
3/12/2020
3/18/2020
10/8/2008

I leave as exercise to the reader to decide if those were good days from a price POV.

Publicly quoted stocks have minimal if any transaction costs. The transaction costs in real estate, and particularly NY real estate, are comparatively enormous. Therefore, unlike stocks, robust trading in NY apartments is a sign of an improving market.

RBerg, The first step of price increase In real estate is price discovery (Real estate very different from stocks in that sense) and increased transaction volume. Next comes stabilization at that price point. And the third is potential price increase. We are still at the first step of post corona price discovery and I do not think any one is taking about price increases yet.

Taking = talking

NB Miller is talking about improvement from full shut down, not from pre-COVID. Nice straw man argument.

Yes. Clearly all the improvements being discussed are vs dark days of summer. That is exactly my point for price discovery happening right now. Once we know the post corona prices and accompanying transaction volume, we will know how much down vs pre corona sometime in December/January in Streeteasy condo index but anecdotally before that using reports like Fritz Frigan.

Agreed. I'm also talking about since the shutdown. Is anyone here talking about pre-covid??

Keith Burkhardt
TBG

Speaking of UrbanDigs videos, watch Talking Manhattan interview with Ryan Serhant to hear about the big discounts and concessions spurring New Development sales:

https://youtu.be/s9N_G2cR17c

I saw that. He was talking about some $30mm list price some developer pull out of their backside taking a cut to $17mm. We have Zaha Hadid as another example for ultra-luxury price cuts. I never thought Zaha Hadid should have gotten the ultra luxury list price as it does not have high floor unique views.

If your role model is Sisyphus' less successful and unacclaimed younger brother, NYC Real Estate is really for you right now.

Without drawing on Greek myth..... I'm just saying things have started to improve since covid-19 dug it's heels in.

30, Come on. Smile!! Keith, you and I just agreed that all the improvement we are talking about are from the dark days of Corona summer.

And we need to see healthy October contract activity exceeding 2018/2019 October as a minimum for market sentiment improvement to hold.

@300, if you search "Starting 1 month ago" + "Contract Signed", and sort by Newest, you will find 254 units dated Oct 1 or newer.

Same technique reveals 619 new listings in the same time frame. So we're still nowhere close to seeing inventory level off.

(Note: you don't need to actually count the rows on your screen. Use Chrome dev tools, or multiply the "page_nr" value in your browser's address bar by 20).

RB, Thank you. I always use Streeteasy search out of old habit but I see that urbandigs has a much better search for this purpose.

On inventory leveling off as a signal, we are currently in a unique situation post-Covid where market was more or less shut down resulting in pile up of inventory. With contract activity happening, traffic jam has started to open and more people are checking traffic conditions and getting on the highway.

Am I the only one who remembers last Fall hearing this same line of how it was a great time to buy and those who missed the boat were going to regret it?

No, IIRC it was 2009, especially if you bought into a place that held maint increases at just 2.3% per year. Opportunity of a lifetime:

https://streeteasy.com/building/50-gramercy-park-north-new_york/sale/1468508

@30 this guest sure thought so https://soundcloud.com/john-walkup/opportunities-efficiency-positioning-with-louise-phillips-forbes

(probably others too, I just picked one at random)

@30Y / nada / rberg: But this time is different! /s

To be fair, Keith is probably right that things are better since the depths of Corona. But that's not exactly a hard comparison to beat. I also see some cases where owners have been shaken out of their complacency to actually start pricing at a more competitive level, e.g., one of the owners in a building accepts reality and is clearly pricing differently vs. others.