September 2022 Market Update

We, at the LevinKong Team, hope that you are safe, well, and we send our best wishes for an enjoyable Labor Day weekend. As we approach the end of summer, New Yorkers are soaking up the remaining perks of this sun-drenched season. For some, that means packing a picnic to enjoy the relaxation and sprawling landscape of Central Park or the Brooklyn Waterfront; for others, it’s heading out east to savor those final magical moments at the beach.

Our slow summer market is coming to an end; as we head into the fall, we will see what was the result of typical seasonal slowdown and what has been caused by economic and interest rate volatility. Regardless, buyers are certainly taking more time to make real estate decisions. However, over the last couple of weeks, we have seen a slight uptick in activity. Brooklyn in particular has started to percolate, while Manhattan has shown some positive signs as well. As we’ve been relaying, the rental markets in both boroughs have maintained comfortable footing in record-high territories, and have not demonstrated any indication that they will slow down in the near future.

While it is a great time for buyers to test the waters for vulnerable sellers, this is particularly true in higher price-points and with new development projects. These were the market segments that benefited the most over the past couple years, so it only makes sense that they would see the most profound shift. Lower and middle price-points are showing the most resilience as market conditions change. Most advantageously, we are helping our clients achieve concessions with developers that were not attainable until recently.

In general, we are still in a very low inventory market across most segments. This is helping maintain relative price strength. Brooklyn’s overall inventory is down 9% from last month and close to 20% year-over-year. This has caused the borough’s market pulse (pending-to-active ratio) to increase 4% from the prior year even though there is lower deal volume. In Manhattan, supply is down 11% from last month and 5% from this time last year. We will see more inventory hit the market post-Labor Day, but we are not expecting that volume to be in line with years past.

With proper guidance, there are many ways to take advantage of this dynamic and intricate market. More than ever, a data-driven, research-based approach rooted in decades of experience, will equip our clients to thrive in this environment. Enjoy the rest of your summer, have a fantastic Labor Day weekend, and please let us know if we can answer any questions you may have about the market, or how best to navigate complicated decisions.