Jarred Kessler Real Estate In Manhattan Hits Record Low For 2018

For the first time since 2009 and the housing market crash, Manhattan has had its worst year. In Manhattan alone, home sales plummeted 14 percent in 2018 which is the biggest drop in percent since 2009. This is a culmination of tax changes, new rules and inventory issues Manhattan has faced. The price for an apartment in NYC fell below the $1 million average, the last time this happened was three years ago. Will Manhattan rebound from this drop?

Jonathan Miller, the CEO of Miller Samuel an appraisal firm, believes that 2019 will most likely not improve much from the lows of 2018. He thinks the drops won’t be as severe, but it will not surge back up to where it was. The reasons for this belief is the combination of a few new economic factors. One of these factors is the inventory of high-end apartments and condos are at an all-time high, which can be a good thing in some markets but in Manhattan the other factors aren’t helping this one. Some new regulations on foreign money laundering alongside of economies in foreign countries have slowed created less demand for these high-end living spaces. Lastly, a new tax law was passed which reduces the deductibility of state and local taxes, which New York and Manhattan are one of the highest tax areas.

Miller thinks that due to the stock markets at the year’s end will also affect the buyers interested in some real estate in NYC, this shouldn’t affect 2019 as a whole but still will have an impact on Q1. He expects the market to be a slower decline rather than a sudden drop like 2018 was, although the entry-level market of smaller studios and one-bed apartments will hold up better than luxury markets. Miller also believes while the starter market will hold up better, the luxury market shouldn’t change much either in 2019 as well. Lastly, he says that buyers shouldn’t expect any great deals yet as the current average price of an apartment in Manhattan is above $2 million right now.

This blog was originally posted on JarredKessler.org