Photo: Robert Clark
Tight inventory continued to drive prices up in much of NYC in the second quarter of this year, according to a newly released report by the listing site StreetEasy.
Homebuyers in Queens were hit the hardest by rising prices, with home prices rising substantially in nearly every submarket.
Home prices were up 1.2 percent from last year to $1.1 million in Manhattan, up 5.6 percent to $757,507 in Brooklyn and up 8.3 percent to $500,302 in Queens in the second quarter.
A shortage of available homes to buy has kept the NYC market competitive, and out of reach for some buyers.
“Looking at this year’s home shopping season, we’re seeing a competitive landscape with rising home prices and falling inventory levels across the City,” says StreetEasy Senior Economist Grant Long.
In Manhattan, home prices were up in nearly every submarket. Only the Upper Manhattan submarket, one of the last remaining pockets of relative affordability in the borough, recorded a slight annual decrease in home prices. Home prices dropped 0.4 percent from last year to $497,000 in the second quarter.
Manhattan’s “luxury” submarket, or homes valued at or above $4 million, cooled. Home prices fell 3.5 percent from last year in the luxury submarket in the second quarter. Meanwhile, home prices in the entry level or “lower” level of the market rose by close to 5 percent from the same time last year — the largest gain recorded in Manhattan’s submarkets.
“Buyers looking for homes in the luxury sector will have the most negotiating power of any other buyer in the market as supply continues to outpace demand,” Long tells BuzzBuzzNews.
Manhattan’s inventory remained tight in the second quarter as active listings decreased almost 22 percent from last year.
Meantime, the Brooklyn market generally mirrored Manhattan’s in the second quarter, with prices up in nearly every submarket. Home prices fell over 10 percent from last year to $937,000 in Prospect Park, the only Brooklyn submarket to record a year-on-year decrease in home prices.
Similarly, Brooklyn home shoppers had a little over 16 percent fewer dwellings to choose from in the second quarter compared to the same time last year.
Brooklyn renters also felt the sting of rising prices. Rents hit $2,442 in the second quarter, up 1.3 percent from last year. That’s one dollar shy of the all-time peak of $2,443 reached in the third quarter of 2016.
Of the three boroughs examined by StreetEasy, home prices were up the most in Queens in the second quarter.
Home prices rose at least 5 percent from last year in every submarket but the Rockaways, where they climbed 2.3 percent. Prices appreciated nearly 6 percent to $757,000 in the hot Northwestern submarket, which includes the rapidly growing Long Island City neighborhood.
Inventory in Queens remained mostly unchanged in the second quarter from the levels recorded over the last two years.
Queens renters got a bit of bad news in the second quarter. Median rents rose over 1 percent to $1,989 per month — an all-time high for the borough.
And although the market was competitive for buyers citywide, the share of homes with a price cut rose from last year in the second quarter — especially in luxury submarket.
In Manhattan and Brooklyn, nearly 4 percent of homes were discounted, and 6 percent in Queens were discounted.
“The share of homes that offered a price cut were up since last year, signaling that there are limits to how fast prices can rise and that more sellers may be willing to negotiate,” says Long.
Homebuyers in the city looking for affordable housing should expect the competitive market conditions to last past the summer buying season.
“The most affordable homes across New York City are seeing prices rise the most and inventory fall the sharpest – two key indicators of a highly competitive market,” Long tells BuzzBuzzNews.
Although high demand and low supply for affordable housing exist year-round, Long says this dynamic is felt “more acutely during the summer home shopping season.”
Click here to read the entire report.