Coronavirus

Manhattan median price drops 15 percent on deals during the shutdown

"Each sale was essentially a referendum on how badly that particular seller needed to sell," writes John Walkup of UrbanDigs.

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2020
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A new real estate market report sees a 15 percent drop in the Manhattan median price for deals done after the start of the pandemic, but the discounts themselves were very idiosyncratic—and depended on the eagerness of each seller.

UrbanDigs, a Manhattan real estate analytics platform, analyzed Manhattan deals from the start of the pandemic through June 18th and found sales that occurred after the lockdown was “far more likely to see volatile listing discounts.” The deals that took place after March 20th had a median sales price of $960,000, compared to $1,125,000 pre-Covid.

According to the report by John Walkup, COO of UrbanDigs, the industry’s move to freeze the days on market counters on listing sites kept existing listings on the market and prices for those listings stable. With no buyers and no stigma, sellers saw no reason to reduce prices, he notes.

And with few buyers around and sellers unwilling to lower prices to test the market, Walkup says the spread between buyers’ bids and sellers’ asks widened. Ultimately, the sales that occurred during the lockdown had an inconsistent pricing pattern. 

“Where normal markets revolve around buyers, the pandemic market revolved around sellers, as each sale was essentially a referendum on how badly that particular seller needed to sell,” he writes.

New listings coming on the market have outpaced the number of signed contracts for several weeks. Even though there are far fewer new listings than usual, there’s risk of an oversupply, which can impact prices, the report says.

Now that NYC has entered Phase 2, buyers can see unoccupied listings in person and there's likely to be a surge of activity, the report notes. But there are some headwinds: New Yorkers’ growing interest in the suburbs, the timing of the reopening to coincide with the slower, summer months, and the fact that many Manhattanites are still sheltering outside the city means “there’s considerable risk that the initial surge of activity will fade.”