Although things were looking grim during the pandemic, Manhattan's real estate market is showing signs of recovery. In fact, according to a recent report by UrbanDigs, this is the hottest it's been in about six years.
The report analyzed the Manhattan sales market on a weekly basis from 2004 to 2021 and determined the top 20 weeks for deal volume. The best one was the week starting Oct. 19, 2015, when 534 sales contracts were signed. In second place is the week of May 10, 2021, which saw 417 contracts signed.
That alone should give investors some relief, but it gets even better: 16 of the 20 top weeks were in 2021, including the week of Feb. 8, which saw 304 sales contracts signed. However, 2016 nabbed just one spot on the list, when the week of May 16 saw 322 contracts signed.
It's important to note that the 2021 weeks of March 8th, 15th, 22nd, and 29th -- a year after the start of the pandemic lockdown in New York City -- all made the top 20 list. Tenants might have left the city during the height of social distancing, but the UrbanDigs report shows that there is renewed interest in living in the Big Apple.
The report indicates that the week of May 31 was the sole exception during an otherwise exceptional spring in the Manhattan real estate market. This is easily attributed to the slowdown during Memorial Day weekend, when people were finally able to freely enjoy the long holiday in the company of others. Still, that week was ranked at No. 24 overall in terms of sales volume.
Will it be a cruel summer for New York real estate?
While the increase in Manhattan sales volume is something to celebrate, summer will be the ultimate test, when demand decreases and sellers rethink their strategies.
John Walkup, co-founder of UrbanDigs and author of the report, noted there: "While the overall trend appears to be a general reflation in Manhattan real estate, the fast and furious nature of spring 2021 is likely unsustainable."
As the dog days of summer approach, New York City is still in the throes of economic recovery, particularly in the office and retail sectors. There's also an upcoming mayoral election, and the lifting of international travel restrictions could have would-be buyers focused more on booking plane tickets than signing contracts. As a result, property inventory will increase, as will time spent on market.
But all hope is not lost. The report suggests that those who were reluctant to jump into the Manhattan real estate market before might do so now. If so, the market may keep its momentum until fall, when the next lull typically occurs.
The Millionacres bottom line
The real estate market will always have its ups and downs, but Manhattan had an exceptionally rough time during the pandemic. Although this current hot sales trend will likely taper off in the next few months, signs of recovery in the big city are evident.