NEW YORK, NY - Multiple levels of uncertainty and two major tax changes weighed on 2019.
Uncertainty causes fear and arrests execution. With the partial China and USMCA trade deals, and additional clarity on Brexit, uncertainty has partially subsided. The upcoming November presidential election and the overdue recession still loom.
Following the reduction of state and local tax deductions imposed in 2018, in 2019 NY increased mansion and transfer taxes on $2M+ sales. Tax changes are non-negotiable: 2019 was the year of their absorption.
Buyers in large part had the upper hand; sellers transacted when choosing price over patience. Year-over-year statistics show some signs of submarket stability:
-Sales volume is 1.2% lower overall, but 1.6% higher under $5M; sales above $5M fell 37.6%
-Manhattan is a statistically balanced market with 7.6 months of inventory (6-9 months is balanced)
-Median new development sales price was up 2.1%
-Average discount to last asking price is down 9% to 6.2%; 6% of sales were above ask
When markets are going down, the natural tendency is to step back, but assuming one believes in the asset class, it’s actually the best time to jump in. One has maximum choice and benefits from the negotiating leverage afforded when alone at the negotiating table. Paraphrasing Warren Buffet “be greedy when others are fearful”.
Source: Manhattan Brokerage Fourth Quarter 2019 Market Reports
Julia Hoagland and her team bring expertise to the Manhattan marketplace through extensive data examination and thoughtful interpretation. Julia and her team were ranked number one in their office multiple times in the past 14 years, and in the top 1% of nationwide agents and in the top 5% of Manhattan agents by Wall Street Journal/Real Trends rankings and the Real Deal. JHT has specific core competence in the downtown loft market, repositioning unsold properties and estate preparation and sale. In addition to her work with local and national clients, Julia's international clientele take her annually to Hong Kong and Europe.