Market Update: Very Active Buyer Pool

A: If I were to describe how the NYC real estate market is right now, it would have to be VERY ACTIVE. Take it for what it is, buyers are out there in full force putting pressure on those with time pressures to move.

I'm a real estate broker. I currently ONLY represent buyers as my last sales exclusive sold in 2 weeks, after a short bidding war. Right now, I have a very broad range of buyer clients, 10 in all, 18 if you count some buyers who have asked me to work with them but aren't ready to buy just yet. My clients price point ranges from $400,000 to $3 Million. The majority are between $1M - $2M. Every OH or appointment I go to is very busy these days. I am finding that between 2-5 people at a showing during the short time we are there is the norm right now. Take it for what it is. If your a buyer right now, than you probably have noticed the increase in traffic recently.

I reported on this shift in the NYC marketplace about 4 weeks ago in my post, "Buyers Are Out In Full Force", but at that time it was just the beginning of the trend and I wasn't sure whether it would last. Well, it has! If you don't believe me fine, I really don't care. I just like to tell people what I see out there when Im with clients, and let you decided whether or not I'm full of sh*t. You can't get more real than reports from the field. Below is what I have noticed over the past 5 days of working with my buyer clients.

APARTMENTS WITH ACCEPTED OFFERS

155 E 76th Street
150 E 69th Street
150 E 69th Street
1601 Third Avenue
301 E 79th Street
53 Horatio
350 E 62nd Street

THIS TOWNHOUSE HAD 4 BUYERS PASS THROUGH WHILE I WAS THERE

20 W 90th Street

THIS NEW DEV ALSO HAD 4 BUYERS IN THE 20 MIN I WAS THERE

The Hit Factory Condominiums

I have also lost 2 bidding wars, including that $1.7M one I wrote about last week, and submitted bids for 2 separate clients that garnered no response even though the bid submitted was within 5% of asking. In those cases, the seller already accepted a higher asking price but the deal fell through and the buyers backed out. So now the seller has a certain price in mind and is less willing to negotiate with new bids.

This tells me that sellers are getting details of the changing marketplace from their hired brokers and are adapting their strategy's with negotiating with clients. In short, they are tightening up and not as willing to negotiate as they were only a few months ago! I wouldn't go as far as say that the current market is a seller's market, but if it I had to rate it on a scale of 1 to 10, with 10 being the most active sellers market and 1 being a very slow buyers market, I would probably rate it a 7.

Now you may not see the data on what I'm describing for months as any eventual change won't be recorded until a contract is signed and the deal closes some 2-3 months later. Real estate data is a lagging indicator of the marketplace leaving you guys with very few options to get a true, inside look at what is really going on in the Manhattan real estate market. I try to assist in this transparency problem by blogging here on UrbanDigs.com. Whether or not you believe me is an entirely different issue.

Assuming you do understand that what I talk about here is as accurate as it gets, lets discuss what you need to do about it:

BUYERS WITH A TIME PRESSURE - Get moving fast! See as many property's as possible over the next few weeks and make a move sooner rather than later. If you are pressured to purchase a property AND close within 3 months or so, you need to pick out the best of breed product in your price point NOW! If you don't, you'll get stuck later on with a mid-tier product.

BUYERS WITHOUT A TIME PRESSURE - Take the next 1-2 months to learn the product in your target price point. Try to wait for the frenzy to die down a bit. In these environments, you lose negotiating power and are less likely to secure a transaction at the purchase price you were hoping for. I wouldn't expect the frenzy to last longer than a couple of more months leaving the summer months as your buying opportunity with the threat of less inventory to choose from.

SELLERS: Well, you should know that now is as good a time as I have seen recently to be selling your apartment. I wouldn't get greedy or start raising your asking prices too high, but I would keep an open communication with your hired seller broker and find out if the increase in activity has hit your property. If it hasn't, your price is too high. If it has, chances are a bid is not too far away! It really depends on where you originally priced your property and the selling strategy you and your broker employed. If you messed up and overpriced, now is your chance to correct it and still get a good purchase price for your home. If you don't sell your home in the next few months, what chance do you have heading into summer when traffic is known to drop siginificantly!

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