The Manhattan market is still in reset mode. Thousands of apartments are lingering on the market, both new development and resales. It's a buyer's market in most neighborhoods, especially in the condo market. Interest rates are still near historic lows. The rate for a 30-year Fixed Rate Mortgage is currently at 3.875, according to Wells Fargo. More deals are getting done this year as prices have come down and interest rates have dropped from nearly 5%. The number of contracts signed in Manhattan has increased year-over-year, according to the Berkshire Hathaway HomeServices New York Properties 2nd Quarter 2019 Manhattan Market Report.
The townhouse & co-op market is showing mixed results in different parts of the city, while condo prices have decreased in all sections of Manhattan year-over-year. The median closed sales price of a condo in Midtown is $1,215,000, down 9% compared to the same time last year. The condo market on the Upper East Side & Upper West Side has dropped the worst of all sections of Manhattan. The median closed sales price for a condo on the Upper East Side is $1,450,000, down 16.7% year-over-year. Similarly, the median closed sales price for a condo on the Upper West Side declined by 17.6% to $1,600,000. The median closed sales price for a condo in the Downtown market is $1,588,000, a decrease of 11% year-over-year. The median closed sales price for a condo in Upper Manhattan is $806,000, a decrease of 2.3% year-over-year.
The co-op market is showing mixed results in Manhattan. The median closed sales price has gone in Midtown & the Upper East Side. The median closed sales price for a co-op on the Upper East Side is $1,072,000, an increase of 7.4% year-over-year. The median closed sales price for a co-op in Midtown has gone up similar by 7.5% year-over-year. Meanwhile, the median closed sales price for co-ops has decreased in all other sections of Manhattan outside of Midtown & the Upper East Side. The largest decline in the co-op has occurred in Upper Manhattan, where the median closed sales price is $490,000, a decrease of 12.5% year-over-year. The median closed sales price for a co-op on the Upper West Side has dropped 8.7% year-over-year to $975,000.
It's a seller's market for townhouses in Midtown and Downtown, where townhouse prices are 5% & 6% year-over-year. The median closed sales price for a townhouse in Midtown is $4,525,000, an increase of 5% year-over-year in Midtown. The median sale price for a townhouse in the Downtown market is $7.8 million, an increase of 6% year-over-year. The median sales price for townhouses on the Upper West & East Side has declined. The median closed sales price for a townhouse on the Upper East Side is $9,250,000, a decrease of 17% year-over-year. Similarly, the townhouse market on the Upper West Side has declined 12% with a median closed sales price of $7,100,000.
The NYC Mansion Tax, a tax on the purchase of real estate above $1 million, will rise for the first time in 30 years. The tax is customarily paid by the buyer in the transaction, while the seller is on the hook for state and local transfer taxes (which also increased this year). The new tax increase on home purchases went into effect on July 1st, a few months after Albany passed new legislation earlier this year.
Under the previous law, there was a 1% flat-rate tax on all purchases above $1 million. Under the new law, homes sold between $1-2 million will still be taxed at 1%. The new NYC Mansion Tax has an increasing scale for homes sold above $2 million. Homes sold between $5-10 million will now come with a tax of 2.50%, while homes sold above $20 million will be taxed at 4%.
State lawmakers claim the tax increase on home purchases will help pay for the city's out-dated subway system. Home prices on the higher end of the market in NYC could be affected by the new increase in taxes on home purchases. Only time will tell how this affects the real estate market in NYC.
Check out the chart from Bloomberg.com below which details the new NYC Mansion Tax.
The Fourth of July is significant because it was the day that our Declaration of Independence was adopted by the Continental Congress in 1776. The importance of the Fourth of July is that it marks the birth of the United States of America.
The 56 signers of the Declaration of Independence knew it might be death sentence, whether they were successful or not. British forces would quickly sail across the Atlantic to descend on the 13 colonies, which at the time didn’t have the resources needed to defeat a global power like Great Britain.
Yet the signers risked it all and put their signatures, and their lives, on the Declaration of Independence. This decision would eventually birth a new nation founded on ideas like life, liberty, and the pursuit of happiness.
Happy Fourth of July!