SPONSORED
By Roberto Cabrera
By now everyone knows that falling prices have created a buyer’s market. That downward pressure on pricing has been driven primarily by policy, which has stolen value from all sellers. These include the reduction in the SALT (state and local tax deductions), increases in the mansion and transfer taxes, rent regulations on multi-family properties and limits on LLC purchases. Further pressure is coming from lower foreign investment, due not only to a strong US$, but money flowing out of Russia and China, where capital controls have been placed upon them.
Most all of these factors have indeed begun to bake into our current pricing, which in some cases is back to 2011-2012 levels. Consequently, we are seemingly resting at “the bottom” and with an election year in front of us, we could linger here for a while. That said, market activity has begun to increase; we are up nearly 5% from one year ago. This is a result of the simple supply and demand principle; increasing numbers of sellers are recognizing the market shift and what it will take for their properties to sell and more and more buyers seizing upon this unique time in the marketplace.
Ironically, the past several years of buyer-fear has created a substantial level of pent-up buyer demand, which has yet to be truly unleashed. And whereas election years are notoriously languid, due to future uncertainty, two factors seem to prevail: 1) people have become numb to the news cycle and seem prepared to handle any sensational outcome and 2) market conditions are simply undeniably favorable for buying.
Regarding number 1) whatever the reason for each and everyone’s malaise, they realize that life will, and must, go on. They must get on with it. And…well, here we are. Which brings us to number 2) I sincerely believe this is the greatest buying opportunity in Manhattan in our lifetime . Prices are down (substantially down in many cases), interest rates are down over a point from one year ago (see Purchasing Power analysis below) and inventory mounts. This means there are sellers who have been on the market for extremely long periods of time and are willing to get a deal done.
Meaning that if you are a buyer, opportunity is not knocking, it is pounding on your door. Those who ignore it, will next year be naively saying, “…what was that noise I heard?” Note the past tense….”was.”
What an amazing opportunity to upgrade!
QUESTION:
Are you prepared to dive in? You should always know what you are in a position to buy or sell at all times. If you don’t know, reacquaint yourself with the marketplace. What is your property worth? What can you afford to buy? Anyone interested in buying or selling, should be rolling up their sleeves to determine whether the time is right to sell or if there’s a home or investment property out there for them.
Roberto Cabrera
Licensed Real Estate Broker
Brown Harris Stevens
212.906.0554
Your City, Your Broker…
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