New York City: Q1 Real Estate Roundup

Three Topics, One Quarter

Contract Signed Activity, Overall Inventory/Supply:

After interest rates came down at the end of 2023, the first two months of Q1 2024 saw a sizable pickup in buyers putting property under contract. With inventory tight because the spring inventory push was still on the horizon, January and February felt more in favor of sellers than buyers. However, as interest rates started to inch up, by the end of February, there was a noticeable pullback by purchasers. Contract signing activity was actually negative during the first two weeks in March. However, as we approach the official start of the spring market (today!), we’re seeing purchasers come back to the marketplace despite interest rates hovering just under 7%. The end of the first quarter of 2024 saw overall inventory reach roughly 6,500 total available listings, which is on par with most previous “normal” years. Historical data also hints at what we can expect going forward — about 7,600 listings by about the middle of June — giving buyers plenty of options and contributing to a more balanced market.

The NAR Settlement and Lawsuits:

Many have read about the changes to commission structures, pending the National Association of Realtors lawsuit settlement. New York City is not under NAR jurisdiction. Most city agents (if not all) are not part of the National Association of Realtors (NAR). The Real Estate Board of New York is our local volunteer governing body, and all of the major firms and most smaller firms are part of REBNY, which has been active in getting ahead of these rulings. Most New York City brokerages have amended their listing agreements to lay out the commission structure so sellers can better understand how the commission structure is paid out and have more options on choosing how to pay out commissions, if they decide to pay them at all. As a New York City real estate agent for the past 22 years, I have to say that commissions have always been a negotiated item, like everything in real estate. Everything is negotiable! Price, commission, closing date, closing costs — you can even negotiate furniture in the apartment! So, the settlement may have far-reaching changes on a national level, but it will be interesting to see how it may or may not affect the New York City market, as the National Association of Realtors never had jurisdiction here.

Looking Ahead:

As the spring market gets underway, we are seeing an increase in overall listing supply and buyer activity, as we do every spring season. We’re not observing a record-setting pace this year so far, but we are seeing a normal flow and cadence, which is refreshing with all the changes that are happening around us. Real estate in Manhattan and Brooklyn has always been a reliable investment with no real swings and angulations up or down. It’s a steady ship that can give many homebuyers and homeowners a sense of stability. And with the presidential election on the horizon, it looks like we’ll see most of the activity in Q2 and the beginning of Q3, with a wildcard for the last four months of the year. Overall production for 2024 should be on par with most normal years once we close out the year in December.

COMPASS in the News

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