Data Shows NYC Real Estate is Seasonal

A: I don't link out to superstar appraiser Jonathan Miller's blog, Matrix, enough. Maybe its because he gets so much press as is, that whats a little more going to offer him? Nah, thats not it. Fact is, Jonathan puts so much time into forwarding to readers what he sees in his business (trends, data, charts) based on so many different datasets that he deserves every bit of press he gets! I certainly appreciate the effort! His latest chart shows how average price per square foot in Manhattan real estate sales differs based on time of the year (quarterly) and adjusted for inflation. It shows what I have been saying here on UrbanDigs since the beginning, that NYC real estate is seasonal!

Manhattan Co-op/Condo Average Price Per Square Foot By Quarter (1989-2007) via Curbed.

What we see here is simple:

Blue & Pink Lines (represent months JAN - JUNE) --> generally higher percentage change from previous quarter

Green & Orange Lines (represent months JULY - DECEMBER) --> generally lower percentage change from previous quarter

In other words: NYC REAL ESTATE IS SEASONAL!

For the most part, the months of JAN - JUN show a higher average price per square foot for both co-ops and condos in Manhattan than the months of JULY - DEC do! This is not surprising! I talk often how buyer demand in the months of JAN - MARCH are normally much more active than any other 3-month consecutive range of the remaining calendar year. The months of MARCH - MAY are transition months where activity from buyer demand tends to move from very active --> to active --> to good ---> to slow. Once we get into the months of JUN - AUG, the market is typically significantly slower with only a few serious buyers coming to open houses and much fewer appointments during the week!

My advice would remain the same as I said in the past:

For Sellers: Try to get a contract signed BEFORE June! Its not rocket science when declaring that sellers get the most money at resale when there is the most activity on the property! As activity slows, so does the chance of getting top dollar! For those sellers that MUST sell and are not simply testing the market, try to get that deal done before the summer months because if you don't you will have a much harder time matching an offer that may have been presented only a few months earlier!

For Buyers: If you are not forced by a time pressure, try to wait out the market a bit. If you find a place that blows you away and the price is right then by all means go for it! But if you are not in a rush, time is on your side, are looking to build your cash reserves, or just haven't found your dream home yet, there is one thing I can assure you: you should gain more control over negotiating during the summer months at the expense of less inventory to choose from!

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