Competition for apartments in Manhattan and Brooklyn is insane right now. If I put buying on hold for a few months, do I have a better chance of avoiding the bidding wars?
Ordinarily, the real estate market cools down a little in the fall, but this year may be different, our experts say.
The number of sales in Manhattan surged in the second quarter of 2021 to its highest quarterly total in six years. There are fewer listings available, which is heating things up even more and leading in some instances to bidding wars with apartments selling for over the asking price. Brooklyn is also experiencing high demand from buyers looking for more space for their money.
Traditionally, the real estate market slows a bit in the third quarter, because families want to be settled as children return to school, but amid the unusual conditions of the ongoing pandemic, the competition may remain fierce well into the autumn months.
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"Some people feel that there could be a real slowdown if the stock market has a slump, but there is so much optimism and a can-do spirit, I believe if it happens, it could be short lived," says Deanna Kory, a broker with Corcoran. "With the economy improving and everyone back to work, I expect that the competition will intensify in the fall."
Despite the fact that there is still uncertainty surounding policies for remote and in-person work, and the rising dominance of the Delta variant, plenty of buyers are returning to the market, a sign that many New Yorkers will continue to be on the hunt for a new apartment in the near future.
"Companies haven’t called their employees back en masse yet, and with the variant expanding, it is not clear whether that will happen largely in the fall while consumers figure out remote work," says Jonathan Miller, president of appraisal firm Miller Samuel. "The boom is occurring prior to companies calling back employees, so those upcoming call-backs look like a future uptick in demand."
Moreover, a number of economic factors are making it particularly difficult to predict market fluctuations. Billions in federal stimulus funds are flowing through the economy, and mortgage interest rates are historically low. At the same time, Miller points out, banks are lending much more conservatively than they were in the years of the housing bubble.
All this is to say that if you want to buy, you're better off not trying to time the market—so jump in now.
"I’ve always thought that timing a housing market had limited potential because of the volatility of conditions economic, political, and natural can’t be reliability predicted," Miller says. "It’s a mess of economics and anyone who can figure out how to time all this is frankly, just lucky."
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