New York City’s real estate market reacted strongly to the economic uncertainty of 2023’s first quarter. Many buyers throughout our market put their plans on hold in the wake of the 50 basis point increase in the Fed rate during the month of December (which followed several 75 basis point increases). Mortgage rates continued to rise, the stock market fell, and transaction volume, which had been slipping throughout the second half of 2022, remained weak in January. Surprisingly, it then began to strengthen in February, and improved even more in March. That said, the deals which got made correlated strongly to price reductions or highly realistic listing prices. There has been no room for optimistic pricing in 2023.
The high-end market (homes at $10 million and over) has suffered disproportionately during this year of correction. Throughout the first two months of the year, few high-end listings sold, and those which did tended to have either unique qualities or the luck of the draw in finding that one buyer for whom the property was exactly what they wanted. Owners who bought since 2014 or 2015 have had to accept substantial losses on their properties in order to move them.
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