1Q2022 Market Summary from the Stein-Testa Team
Emily: Hi, I'm Emily Stein from the Stein Testa team.
Tony: And I'm Tony Testa.
Emily: So today we're going to be talking about the first quarter of 2022, all of the market stats, we'd like to share that with you.
Tony: Absolutely. And it was a busy first quarter. So as far as sales volume; the busiest first quarter in 15 years, as far as contracts signed; our busiest quarter ever. Over 4000 contracts getting signed in the first quarter, which is pretty remarkable.
Emily: I know, and since 2007, we have not seen numbers like this since then. So that's really…
Tony: Overall sales volume went up actually 60%, and a lot of that is, first of all, it’s market-wide in Manhattan, this is specific to Manhattan. A lot of that being buoyed by increased demand, and low inventory.
Emily: Low inventory. Yeah, a lot of neighborhoods in tthe Manhattan area are seeing a big surge in sales because other areas, there is absolutely no inventory. So people are thinking now about different neighborhoods to go into which they probably did not think about before.
Tony: Yeah, well, basically the fall in the inventory, so inventory is actually falling about 25% in Manhattan, largely 34th street and below. So like the downtown neighborhoods especially where we didn't really have a lot to begin with coming out of COVID. So this entire 2021 and especially our first quarter of this year, we've just seen that number decrease, decrease as far as available options.
Emily: And available options were also studios and one-bedrooms which now have been gobbled up. So, the higher price now, above 5 million, is doing much better than it did just a few months ago.
Tony: Which is largely attributed to new development where we see bigger price points anyway. But new developments downtown, there's a bunch of them that we've been into. There's a lot in Midtown, of course, and that's where the really high prices are, but all over downtown, prices for new development are pretty impressive and they're moving.
Emily: Yeah, and let's talk about price per square foot. That is crazy.
Tony: Yeah. So when we talk about price per square foot, kind of, in our heads we always have these numbers. It's a resale call, it's a resale condo or its new development, we're looking at the median price per square foot which is about fourteen forty-five, and that's an increase especially from the previous year at this time, but even the previous quarter, which tells us when we see that increase, that means pricing across the board is going up. Sales, studio, one-bedrooms, up to five bedrooms, everything is going up when you see that number inch upward.
Emily: And mortgage rates are going up. It's really an ideal time for people to take advantage of this time in our real estate history to buy something and to go forward with it, stay with it for a number of years, earn equity and then either buy a bigger place, stay put, keep the property, whatever you want to do, but now is a great time to purchase.
Tony: Yeah. So now let's jump across the river to Brooklyn where very same story as Manhattan is we're seeing a huge amount of activity in this market as well. So, sales here were the strongest in 10 years, they actually increased 7% from this time last year. We saw about nineteen hundred and ninety-three sales in the first quarter of this year, which is so impressive. Inventories is at a four-year low, inventory has actually decreased 27% from first quarter of 2021.
Emily: So the neighborhoods that we've seen that have the most activity are DUMBO, Brooklyn Heights, and Park Slope. And actually, we had a listing in DUMBO for no more than two weeks and when to best and final, and we have a very happy buyer.
Tony: Yeah. Those neighborhoods in particular are just super, super busy. Inventory is so tight. Days on the market is around 83 days, which is pretty incredible. I mean, all of Brooklyn has been busy. Even the gentrifying neighborhoods like parts of Eastern Bed-Stuy, Crown Heights, but some of these other neighborhoods have just been out of control since last year. [Inaudible 3:59]
Emily: Lines around the block to go see an open house.
Tony: Yeah, it's really remarkable. And it makes perfect sense why people are coming to these neighborhoods in Brooklyn, or pretty much any neighborhood in Brooklyn, it's more space.
Emily: It’s more space.
Tony: Yeah. You get a little bit more for your money.
Emily: Yeah, it's a beautiful quality of life.
Tony: 11 Hoyt and Brooklyn Point are some of the most popular new developments that we've seen in Brooklyn. The Olympian DUMBO is brand new, and, of course, we're going to see Brooklyn Tower launch sales pretty soon. That’s extraordinarily super tall.
Emily: Unbelievable.
Tony: It's now in the Brooklyn Skyline. So new development is going to be, I think, a big story going through 2022 in Brooklyn, mostly because new development here is still more affordable than new development in parts of Manhattan. It gets a little tricky sometimes, they’re getting pretty close in some neighborhoods. So as we keep going through 2022, interest rates are going to be top of mind. They've been going up we've seen for the last quarter especially, we're up to four and three eighths percent right now for 30 year fixed.
Emily: Right. So that is also.. There are two sides to that, that could make somebody… The tipping coin for them not to be able to purchase because it's going to be a little too high for them, or, it's going to tell people, “I've got to do this right now because this is a time in the moment in history of real estate that I'm not going to get again.”
Tony: Yeah. Rates are expected to go up. All the professionals in the lending industry that we keep in touch with to stay on top of everything, we know that rates are going to go up. They're going to be in the fives by summer. They're going to be pushing six by the time the year is done. And there's a lot of other stuff people are thinking about right now. There's a lot of stuff going on overseas. Political atmosphere, some people are talking about inflation still being out of control, “Are we going to have a recession.” Barring anything extreme, rates right now expected to slowly creep up, but our market expected to stay high, and this is not going to change.
Emily: We're busy. So we're not seeing people pulling back. So there are people that are calling us and asking us questions, and we're talking to our mortgage brokers just to find out what the skinny is on what's going to happen in the next six months, so we're able to explain to you what we know, we want to make you more educated.
Tony: Yeah, and more importantly, keep in touch with us if you've got questions, don't read national headlines because the national housing market is a very, very different animal. Their activity has been through the roof, and basically, at an unhealthy rate as well. It makes perfect sense when we hear discussions about the national housing market, most places outside of our very big market or San Francisco's market that will see some major, major slowdowns coming up because it's been out of control. Our market’s at a healthy place. We're super, super busy. Inventory is super low, but we're at a healthy place so we don't expect any major downturns in the near future. So, keep in touch with us, ask your questions, and we're here to answer them.
Emily: Yeah, give us a call.