The Wall Street Journal reported that multiple bids are stunning condo apartment buyers from New York to Miami and homebuyers in California. A lack of inventory compared to demand has been especially evident in New York luxury real estate for over a year. Now multiple bids are occurring on entry-level properties both in Manhattan and in other areas of the country. 3 years ago Miami’s condo market was languishing and its huge inventory remained unsold. Today, between local and foreign investors (namely Brazilian) there is only a 4.1 month supply (34% decline in inventory – see chart below).
In Manhattan while demand for the super-luxury market ($5+ million) has slowed slightly compared to a year ago, fast-increasing rents and low interest rates have lead to the highest level of monthly signed contracts since 2008.
Demand for downtown 3+ Bedrooms condos and co-op lofts is very high. Good inventory is low, leading to well-priced New York apartments in ideal condition receiving signed contracts within weeks of being listed. As an example, I recently negotiated a Nolita condo loft exclusive to a signed contract for more than $500,000 above what a buyer of mine paid for a similar unit in 2010. Developers are taking notice; at a luxury condo conversion in Tribeca, the developer recently raised the price of one unit by over $1.1 million compared to its original July 2011 pricing.
If you are thinking of selling in Manhattan, now is the best time to do so since early 2008.
I work many luxury real estate agents on the West Coast to take care of their Hollywood clients moving to New York. Many have shared with me that 2012 has been extremely busy for them in high profile areas such as Bel-Air, Beverly Hills, Malibu, Santa Monica and the Hollywood Hills.
Increased financing options at all price levels combined with rising rents and very low interest rates have served to increase buyer demand nationwide. As a result inventory levels in many markets have dipped to that of a more balanced market (approx. 6 month supply per).