A blizzard of price cuts by apartment sellers in the Manhattan market earlier in the year is beginning to slow, suggesting the market might have found a new balance at lower prices, brokers said.
Data from listings website Streeteasy.com show that owners had cut asking prices on 44% of the listings of apartments and townhouses active during the second quarter in Manhattan, but that share dropped to 33% in the third quarter.
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Manhattan has experienced a sales slowdown over the last few years in a shift that began at the top of the luxury market and then drifted to lower price points. Some brokers said prices rose too fast and others blame the uncertain political environment before and since the presidential elections.
Many spring sellers who had been holding out for high asking prices gave up and cut them. For example, in the second quarter of 2015, 26% of Manhattan listings featured asking prices that had been cut. The figure rose to 36% in the same quarter of 2016, before topping out at 44% in the second quarter this year.
In Brooklyn, price cutting also declined, to 25% in the third quarter after hitting 35% during the second quarter.
Brokers said price trims last quarter sparked sales, especially of expensive apartments that had been lingering on the market, reducing inventory.
A report on listings by Brown Harris Stevens shows the time needed to sell a Manhattan apartment, on average, rose through much of 2017 and hit a peak of 6.4 months in May. It has since declined each month. In September the rate was 4.6 months.
"There was a lot of price cutting and a lot of selling, a lot of the product that was sitting around got sold," said Gregory J. Heym, the chief economist for brokerages Brown Harris Stevens and Halstead. "Now we have gotten back to a market that is slower. The frenzied pace isn't what it was earlier in the year."
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(END) Dow Jones Newswires
September 27, 2017 05:44 ET (09:44 GMT)