Manhattan Neighborhood Supply Trends

Posted by urbandigs

Sun Jan 22nd, 2012 09:57 AM

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A: As we get into the final days of January, lets take a quick look at how supply trends have been faring across Manhattan. In this post I will show you the "% CHG" in Active Supply trends for all Manhattan neighborhoods over the last three months & the last 12 months. The 3-mth trend will tell us how recent supply trends feel 'in the field' right now as buyers and their brokers seek out new product to see. The 12-mth trend will give us a broader view of the neighborhood's supply trends and tell us where we are today relative to the same time last year. In general, so far there has not been the usual surge in supply that we got used to for the month of January in this marketplace. Lets discuss.

The data doesn't lie so lets get right to what the new supply (active inventory) #s are telling us. Remember, our "Active Inventory" trends count all active exclusive listings by REBNY agents that are shared through the Rebny Listing Service:

1) are brand new to the market
2) have been re-activated from a prior "off-mkt" listing state
3) have been updated by the listing agent once in the last 30 days
4) have been "Active" on the market for less than 2 years

NEIGHBORHOOD SUPPLY TRENDS: 3-MTH & 1-YEAR % CHG
*sorted by 1YR % CHG

Tribeca: 3-MTH -7.6%, 1-YEAR +23.5%
East Harlem: 3-MTH -8.6%, 1-YEAR -2.8%
Upper West Side: 3-MTH -13.2%, 1-YEAR -3.8%
LES/East Village/Union Square: 3-MTH -18.3%, 1-YEAR -4.7%
Upper East Side: 3-MTH -7.4%, 1-YEAR -4.9%
Midtown West/Clinton: 3-MTH -12%, 1-YEAR -6.6%
Midtown East: 3-MTH -13.2%, 1-YEAR -7.2%
Murray Hill/Kips Bay: 3-MTH -11%, 1-YEAR -8%
Fidi/Civic Center: 3-MTH -17.4%, 1-YEAR -8.8%
Battery Park City: 3-MTH -5.6%, 1-YEAR -9.3%
Chelsea/Midtown South: 3-MTH -10%, 1-YEAR -10.8%
Gramercy/Flatiron: 3-MTH -25.7%, 1-YEAR -13.6%
Soho/Noho/West Village: 3-MTH -22.3%, 1-YEAR -14.5%
Harlem/Morningside Heights: 3-MTH -14.1%, 1-YEAR -18.5%
Inwood/Wash. Heights: 3-MTH -9.7%, 1-YEAR -21.9%
Harlem/Hamilton Heights: 3-MTH -12.6%, 1-YEAR -31.1%

This should visually tell the whole picture of the last 12 months of Manhattan supply trends! Sellers, we need more listings!!!

General Conclusions: With the exception of Tribeca that showed a noticeable year-over-year rise in supply (10.8% rise in co-ops, 27.2% rise in condos), every single neighborhood experienced a drop in supply from this time last year. This is consistent with discussions over the course of 2011 regarding 'Monthly New Supply' trends and the conclusion that "we are simply not seeing the levels of new supply come to market that we saw in 2009 and 2010".

Typically this is the time of year when 'new stuff' starts to come onto the marketplace. Right now we are on pace to show a monthly total of 1,195 new listings for this January. For some perspective, the last four January's showed the following new supply hit the market:

January 2008: 1,918 listings came to market
January 2009: 2,031 listings came to market
January 2010: 1,829 listings came to market
January 2011: 1,688 listings came to market
January 2012: ???

Again, the real-time ticker shows us on a monthly pace for 1,195 new listings to hit the market. I would expect this # to rise as we close out January, but I'm questioning if we are seeing enough new supply to break the 1,688 level that we booked for last January. Time will tell.

One might make the predictive statement that with less supply coming to the marketplace, it will be more difficult to see a rise in new deal volume. Frustrated buyers waiting for new supply may decide to put their search on hold until market dynamics change and more supply starts to come on. It's too early to analyze new deal volume right now because its very possible that 100s of deals are currently "in the attorney process" right now; which is impossible to track since brokers very rarely use the 'Accepted Offer / Contract Out' listing status.

This is the major reason why the uptick in new deal volume tends to start in February - first the stuff comes on, then the buyers bid, then the attorney's get going, then the deal gets signed and only then do we capture it. I'll start to dig into this years bonus season production as we get closer to mid February.