Not so long ago, we wrote about inventory having dropped by almost 35% from its highs this time last year, leading buyers to be frustrated by the lack of fresh listings. We suggested that buyers be patient, as sellers would begin listing their properties in what they consider to be a much-improved market. Indeed, this has been the case … with one caveat: now that apartments are coming on the market, those that are well priced seem to be moving very, very quickly.
We have had numerous conversations with agents across the city, and we’re hearing one consistent story: more than half of the apartments they inquire about on behalf of their customers are in contract or have accepted offers, often within the first month on the market.
This is creating a bit of tension among buyers who feel they need to see a new property as soon as it’s listed. No segment is feeling these symptoms more, it seems, than 2-3 bedroom properties in the $1 million to $1.7 million range. Whereas for the last two quarters, most of the increased sales volume was due to properties just under the $1 million mark, activity appears to be spreading upwards in the price-point spectrum.
Indeed, if 2009 was the year of the value buyer, as Mitch Askinas pointed out in his recent post, 2010 may well be the year of returning to normalcy. If, as he notes, “a majority of true bargain hunters have either purchased or rethought their position of purchasing altogether” (which we happen to agree with), then it only makes sense that more traditional buyers are re-entering the market pushing the average size and price of apartments upwards. This trend could account for the limited inventory at the $1-$1.7mm price-point.
Let’s hope that talk of loosening jumbo credit markets is well-founded and continues to materialize in the form of signed contracts.
