For this week’s market update we will be focusing on homes located in Northeast Manhattan. These neighborhoods are primarily starter homes. Again, we will be using the absorption rate model to discover what the market looks like in this area. For those who missed last week’s update, an absorption rate is the speed at which homes are sold in a specific market over a given period of time. A balanced market (not favoring buyers or sellers) is a 6 months’ supply of homes. Any rate lower than 6 favors sellers. Any rate above 6 favors buyers.
To date, this area is showing an absorption rate of 3.16 over the course of the last year, and averaging around 13 closings per month. I’d like to break that down even further to display where the market peaks and where it’s at its lowest.
In the last 6 months, our research shows a rate of 5.52, which is slower than the rest of the year but still favoring sellers.
Looking at the 6 months prior, consisting of the spring and summer market of 2017, our data shows a rate of 2.23, heavily favoring sellers. What this also means is the home prices, consequently could increase. While it is not guaranteed that this spring and summer will be the same as last year’s market, recent history suggests that last year’s market is a good indicator of what’s to come.
This data reveals that the market in Northeast Manhattan favors sellers. To reemphasize, these homes are mostly starter homes and affordable. There is and will always be a bigger market for buyers in the $125,000-$200,000 range than homes listed considerably higher.
Stay Tuned for next week’s update!