The city of Manhattan is now becoming a buyer's market as home prices fall due to an increase in inventory of apartments for sale, according to a report.
The average sale price of real estate properties in Manhattan fell by 3.3% to just over $2 million in the second quarter of 2024. The median sales price also fell 2.2% to $1.1 million during the same period. Furthermore, the median prices for luxury apartments in Manhattan fell by 10.5%, the first recorded in over a year. That is according to a recent report from Douglas Elliman and Miller Samuel, a real estate appraisal and consulting firm.
Why Are Real Estate Prices Declining in Manhattan
The recent decline in Manhattan real estate prices was a result of a rise in the inventory of apartments for sale. The report noted that there are more than 8,000 apartments for sale in Manhattan, up from a usual 10-year average of about 7,000.
This increase in the number of apartments for sale now gives Manhattan a 9.8-month supply, which means it would take nearly 10 months to sell all of the properties on the market without accounting for any new listings.
On top of rising inventory, sales were also up in the second quarter of 2024 to 2,609, marking a 12% increase year over year and the first sales rebound reported in two years.
"The buyers and sellers resolve is weakening," Miller said in their report. "At a certain point, they can only wait so long before they feel like they have to make a move."
Furthermore, the soaring rental prices in Manhattan are pushing residents to buy a home instead. As of March, the average rent in the city was $4,831. This increases depending on the neighborhood, with rents in the Little Italy area being the most expensive at $6,358 per month, according to data from listing service RentCafe. On the other hand, the most affordable neighborhood in Manhattan was Marble Hill, where average monthly rents went for $1,861 in March.
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