{"id":534,"date":"2022-12-31T23:59:41","date_gmt":"2023-01-01T04:59:41","guid":{"rendered":"https:\/\/www.urbandigs.com\/blog\/?p=534"},"modified":"2023-04-11T13:44:50","modified_gmt":"2023-04-11T18:44:50","slug":"the-unsung-hero-of-new-york-real-estate-2022-and-what-it-means-for-2023","status":"publish","type":"post","link":"https:\/\/www.urbandigs.com\/blog\/the-unsung-hero-of-new-york-real-estate-2022-and-what-it-means-for-2023\/","title":{"rendered":"The Unsung Hero Of New York Real Estate 2022 And What It Means For 2023"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"534\" class=\"elementor elementor-534\">\n\t\t\t\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-9960046 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"9960046\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-c1ffb33\" data-id=\"c1ffb33\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t\t\t<div class=\"elementor-element elementor-element-c51beb3 elementor-widget elementor-widget-text-editor\" data-id=\"c51beb3\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<style>\/*! elementor - v3.6.1 - 23-03-2022 *\/\n.elementor-widget-text-editor.elementor-drop-cap-view-stacked .elementor-drop-cap{background-color:#818a91;color:#fff}.elementor-widget-text-editor.elementor-drop-cap-view-framed .elementor-drop-cap{color:#818a91;border:3px solid;background-color:transparent}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap{margin-top:8px}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap-letter{width:1em;height:1em}.elementor-widget-text-editor .elementor-drop-cap{float:left;text-align:center;line-height:1;font-size:50px}.elementor-widget-text-editor .elementor-drop-cap-letter{display:inline-block}<\/style>\t\t\t\t<p>The story of New York real estate in 2022 was a tale of two markets.<\/p><p>The year started in the best of times, as buyers signed record numbers of contracts in February and March. Then April rolled around, and the market began to shift. By fall, it seemed as if the worst of times had arrived. Buyers were scarce, and contract volume fell significantly, with fears of price collapses bubbling up. However, as 2022 closes out, the New York City real estate markets are becalmed. Buyers are not rushed, sellers are not urgent, and prices aren\u2019t collapsing. The market feels rudderless, and narratives are adrift. The recovery story is over.<\/p><p>As such, next year, 2023, is free to write its own story.<\/p><p>With Mark Twain\u2019s insight that \u201chistory doesn\u2019t repeat itself, but often rhymes\u201d in mind, now is an excellent time to look back at the ebbs and flows of 2022 to understand better the context propelling the market into the unknown future.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-8db3d0f elementor-widget elementor-widget-heading\" data-id=\"8db3d0f\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<style>\/*! elementor - v3.6.1 - 23-03-2022 *\/\n.elementor-heading-title{padding:0;margin:0;line-height:1}.elementor-widget-heading .elementor-heading-title[class*=elementor-size-]>a{color:inherit;font-size:inherit;line-height:inherit}.elementor-widget-heading .elementor-heading-title.elementor-size-small{font-size:15px}.elementor-widget-heading .elementor-heading-title.elementor-size-medium{font-size:19px}.elementor-widget-heading .elementor-heading-title.elementor-size-large{font-size:29px}.elementor-widget-heading .elementor-heading-title.elementor-size-xl{font-size:39px}.elementor-widget-heading .elementor-heading-title.elementor-size-xxl{font-size:59px}<\/style><h2 class=\"elementor-heading-title elementor-size-default\">Buyers<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-58df897 elementor-widget elementor-widget-text-editor\" data-id=\"58df897\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The spring busy season of 2022 started with demand at record levels. The number of pending sales in January was head and shoulders above previous years.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-b0e9336 elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"b0e9336\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"600\" height=\"371\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vR6T4-znAb8G8B_PrSRz6QR8ixPuwY5seFDjc4hQxKcC7phdwgaNlwUWYL-F1NNLfEyCs1BPLNWWGwF\/pubchart?oid=827827525&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-abc39c8 elementor-widget elementor-widget-text-editor\" data-id=\"abc39c8\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>While this was mainly on the back of a solid winter, the momentum carried forward, and buyers were out in force by February and March. Low interest rates buoyed much of this enthusiasm but began to climb in early 2022. In April, as conforming rates crossed 5% for the first time in several years, the market downshifted. As summer volume fell from dizzying highs to more typical levels, the perception shifted from recovery to normalization mode.<\/p><p>Fast forward to the fall\u2019s active season \u2014 which, as it turned out, was not very active. A comparative look at the percentage change in the rolling 30-day average contract signed pace since October 1, 2019, shows that the pace of 2022\u2019s fall season fell well below that of the stretch between 2019-2021. The demand curves all start somewhat the same, but the lackluster nature of 2022 was apparent after a few weeks. As far as buyers were concerned, what\u2019s the rush? Interest rates were high, and discounts were low.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-fde6880 elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"fde6880\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"571\" height=\"300\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vQOG4MGWVtfnBGvsI-uZRjfm84FOMbJLsYy0_6yrRReWyuOAt0i3W8N8ofao3yQnWbTpK8IRAP16rBC\/pubchart?oid=2073519590&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-c93d324 elementor-widget elementor-widget-text-editor\" data-id=\"c93d324\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>As 2022 fades out, the amazing shift in market tenor from high to low is evident. The record highs of pending sales in January slowly faded to bottom-of-the-pack performance.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-596adb0 elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"596adb0\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"600\" height=\"371\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vR6T4-znAb8G8B_PrSRz6QR8ixPuwY5seFDjc4hQxKcC7phdwgaNlwUWYL-F1NNLfEyCs1BPLNWWGwF\/pubchart?oid=662728915&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-b31fea5 elementor-widget elementor-widget-heading\" data-id=\"b31fea5\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Sellers<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-c7303fd elementor-widget elementor-widget-text-editor\" data-id=\"c7303fd\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The focus of the recovery narrative was centered around buyers. By now, the myriad reasons for purchasing a home over the last couple of years are well known: more space, low interest rates, and rising prices. The unsung hero in both the rise and fall of the market is supply.<\/p><p>On the way up, as demand increased, supply generally did not. This created a sense of scarcity. New listings were hotly contested, and buyers became urgent. Note that over the last ten years, only 2021 and 2022 have shown a drop in supply from January to February, when supply typically starts building in anticipation of the busy season to come. Tight supply is advantageous to sellers because their listing tends to get star treatment, but the slow drip of product helped to extend the market\u2019s run and kept buyers from fully capitalizing on the leverage they expected.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-482406b elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"482406b\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"600\" height=\"371\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vR6T4-znAb8G8B_PrSRz6QR8ixPuwY5seFDjc4hQxKcC7phdwgaNlwUWYL-F1NNLfEyCs1BPLNWWGwF\/pubchart?oid=1975175131&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-1c2c711 elementor-widget elementor-widget-text-editor\" data-id=\"1c2c711\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>But what makes supply a hero is that as much as it did not increase during the run-up, it also did not increase during the downshift. This was especially true during the fall, as inventory typically builds after Labor Day in expectation of fall buyers and then winds down as those buyers materialize.<\/p><p>Oddly enough, that\u2019s exactly what happened in 2022, except, as shown above, there were far fewer buyers this year. Yet, inventory contracted at nearly the same pace, if not slightly faster than most years. This lack of listings suggests a waning interest among would-be sellers. After all, for many sellers, a sale is a prelude to a purchase. Prices remained sticky, so any would-be sellers would essentially be trading down at this point \u2014 hence, no urgency.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-d54ca05 elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"d54ca05\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"651\" height=\"300\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vQOG4MGWVtfnBGvsI-uZRjfm84FOMbJLsYy0_6yrRReWyuOAt0i3W8N8ofao3yQnWbTpK8IRAP16rBC\/pubchart?oid=2055542852&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-5a9ca22 elementor-widget elementor-widget-heading\" data-id=\"5a9ca22\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Prices<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-6988afd elementor-widget elementor-widget-text-editor\" data-id=\"6988afd\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>As for prices, a look at the median resale condo price per square foot \u2014 a good proxy for overall price action \u2014 indicates that 2022 presided over a slight decrease in general apartment prices over the year. After reaching recent highs of $1,472 per square foot in the first and second quarters, prices fell slightly to $1,439 in the third quarter as the market shift became manifest.<\/p><p>As this measure is computed using sales that were likely signed into contract several weeks if not months before closing, the 2% drop in the third quarter still contained many sales signed into existence in the second quarter.<\/p><p>Accordingly, many expected the fourth quarter to more clearly show the deterioration in prices as demand shrank. Interestingly though, even as the fourth quarter\u2019s lackluster performance sparked worries about tumbling prices, an early look at price action during the quarter suggests that despite the dramatic drop in sales volume, prices have not been truly adversely affected yet.<\/p><p>Here\u2019s where context comes in handy. Real estate price comparisons are best made year-over-year in order to filter out the volatility of seasonality. As the market heads into the new year with volume running on fumes compared to this time last year, it is doubtful that prices in the upcoming quarters will meet or exceed the high-water mark of $1,472 set during the first and second quarters of 2021. After nearly a year of slowing volume, the first year-over-year price declines may finally show up.<\/p><p>Still, with demand down across the country and many \u201chousing collapse\u201d stories gaining attention, the lack of dramatic price action in New York City hints that housing FUD may be overblown, at least for now, and that likely price declines may be milder than expectations would suggest.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-dc4daf0 elementor-widget__width-initial elementor-widget elementor-widget-html\" data-id=\"dc4daf0\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<iframe loading=\"lazy\" width=\"600\" height=\"371\" seamless frameborder=\"0\" scrolling=\"no\" src=\"https:\/\/docs.google.com\/spreadsheets\/d\/e\/2PACX-1vS01aanj5hMbDiNkbUS8N3phOoCWb_OmR9typ-YCymg_wfwTw_z7lxyFrzRJzO9ooq19USZxA3GEyyx\/pubchart?oid=356325836&amp;format=interactive\"><\/iframe>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-4cfc31d elementor-widget elementor-widget-heading\" data-id=\"4cfc31d\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Putting it Together for Buyers &amp; Sellers<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-8125d53 elementor-widget elementor-widget-text-editor\" data-id=\"8125d53\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>As the market heads into its next busy season with low deal volume and weaker prices, inventory may finally begin to build to a point where sellers are forced to compete and buyers have the leverage they have been expecting.<\/p><p>For buyers, this means being patient but ready for action when the right unit comes along. For sellers, this means pricing right from the beginning, or even slightly underpricing, in order to grab attention and corral would-be buyers into competing with one another.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-6724223 elementor-widget elementor-widget-heading\" data-id=\"6724223\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">What's Next?<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-3e148cc elementor-widget elementor-widget-text-editor\" data-id=\"3e148cc\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>At present, the dialectic of COVID panic and recovery has resolved itself, the stock markets are in flux, interest rates are higher than they\u2019ve been in many years, buyers bought, sellers are staying put, and there may or may not be a recession on the way. All of this goes to say that no one has any idea what will happen in 2023.<\/p><p>But what good would an end-of-the-year piece be without throwing a few darts? Here are a few predictions for the year ahead:<\/p><ul><li><strong><u>Prediction 1<\/u>:<\/strong>\u00a0Volume will be quieter than usual. Contracts signed will likely trend toward the bottom of typical ranges. With recession fears and other macro risks, chalk it all up to general economic uncertainty.<\/li><li><strong><u>Prediction 2<\/u>:\u00a0<\/strong>Inventory will increase. Slowly but surely, sellers will come out of the woodwork to see if they, too, can get what their neighbor got. This will push some submarkets solidly into buyer\u2019s market territory.<\/li><li><strong><u>Prediction 3<\/u>:<\/strong>\u00a0Prices will moderate. The (predicted) quieter volume, in combination with the (predicted) increase in inventory, will put the onus on sellers to compete for buyers. Nothing panicky, just a down-cycle, during which quarter-to-quarter prices are down slightly, with year-over-year prices down a bit more.<\/li><\/ul><p>But overall, if there\u2019s one thing for sure, it is that the real estate market of 2023 will write its own story \u2014 and likely won\u2019t resemble the markets of the preceding few years.<\/p><p>\u00a0<\/p><p>Originally\u00a0<span class=\"il\">published<\/span> on Forbes.com: https:\/\/www.forbes.com\/sites\/johnwalkup\/2022\/12\/31\/the-unsung-hero-of-new-york-real-estate-2022-and-what-it-means-for-2023<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>The story of New York real estate in 2022 was a tale of two markets. The year started in the best of times, as buyers signed record numbers of contracts in February and March. Then April rolled around, and the market began to shift. By fall, it seemed as if the worst of times had [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":533,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-534","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-market-insights"],"_links":{"self":[{"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/posts\/534","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/comments?post=534"}],"version-history":[{"count":5,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/posts\/534\/revisions"}],"predecessor-version":[{"id":541,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/posts\/534\/revisions\/541"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/media\/533"}],"wp:attachment":[{"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/media?parent=534"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/categories?post=534"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.urbandigs.com\/blog\/wp-json\/wp\/v2\/tags?post=534"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}