Just as the Manhattan residential real-estate market was shaking itself out of a multiyear slowdown, the party was suddenly over.
Sales spiked during the first quarter, but now the market has all but shut down, brokers say, as fears of the new coronavirus and worries over the economy take hold.
Beginning in mid-March, many sellers stopped adding new sales listings and pulled scores of listings already on the market, according to UrbanDigs.com, a real-estate data and listing site. That steep drop began even before Gov. Andrew Cuomo banned in-person real-estate showings.
The number of Manhattan contracts signed in recent weeks fell by half compared with the same period of 2019, and many of those deals were already in the works before the full impact of the virus on New York, according to UrbanDigs.
The market freeze stopped a first-quarter recovery in its tracks: The number of Manhattan apartment sales rose by 11% in the first quarter compared with the same quarter in 2019, according to an analysis of property records by The Wall Street Journal. Buyers were drawn in by gradually deepening cuts in asking prices by sellers. Median sale prices were down more than 6% in the quarter compared with the year-earlier period.
The number of annual sales of existing co-ops and condominiums reached a peak in 2015 and fell to its lowest level last year, before the rebound in the first quarter. But that short-lived recovery now looks like history.
“The market is dead, dead, dead,” said Donna Olshan, a broker who tracks the luxury Manhattan market.
Already, major brokerages have announced cutbacks. Compass told employees it had cut 15% of its staff. Realogy, a publicly traded company that owns major brands such as Century 21, Corcoran and Sotheby’s International Realty, announced temporary salary and workweek reductions. Other firms are still assessing the situation.
Diane Ramirez, chairman and chief executive of Halstead, said managers were reviewing all aspects of the business. “We know we have to be fiscally responsible,” she said. “We are doing a lot of talking about it.”
But she said some deals will continue during these periods, and when the current scare is over there will be a rebound as homes become even more important to people.
“If we can get back to our lives, there will be pent-up demand,” she said. “Everyone is living in their homes like they never have before and people are now evaluating: Is the home in the right configuration?”
UrbanDigs tracked listing and contract-signing activity week by week, before and after New York began shutting down. It found that in the week beginning March 16, 448 listings were taken down by sellers, compared with 119 in the same week in 2019 and more than any other week in 2019 and 2020. The following week 323 were pulled, according…