June 2021 Manhattan property update by Weimin Tan
Posted by Wei Min Tan on June 7, 2021
6-minute summary of the current Manhattan property market presented by Weimin Tan.
The Manhattan market is currently a seller’s market and the rental market has picked up a lot since companies have started calling people back. Key drivers are very low mortgage rates, pent-up demand and optimism from Covid vaccine.
30-year fixed mortgage rates
The 30-year fixed mortgage rate is at historical low levels at 2.99%. From a buyer’s perspective, buyers would want to lock in now because it is going to be locked in for the next 30 years. For investors, the rent is going to increase over time while the cost of funds stays the same.
Manhattan negotiability at the time of the deal
Manhattan negotiability refers to how much discount a buyer can get from the original and last ask. Right now, the negotiability has gotten a lot less at 4.52% from the original ask and 2.56% from the last ask. The highest was in June of 2020 at 9.52% from the original ask and 6.25% from the last ask.
The key to determining a good deal is off of the closed comparables and not off of the asking price.
Manhattan is currently a seller’s market. What this means is that the buyers have to act fast, there’s less negotiability and the deal is in getting the apartment and not in negotiating off of the asking price.
Rental demand ramping up
The rental market is recovering as companies call people back to the office for at least two days a week that is why the rental market has been picking up a lot from the last 2 months. Right now we have applications where renters do not even negotiate on the price of the rent versus six months ago where everyone was asking for 2 months free.
The market has changed a lot, the streets are a lot busier and the subways are a lot busier. We are not back to normal yet but we are close. We are at the beginning stages of the next up turn which usually lasts for around 7 years.
What We Do
We focus on global investors buying Manhattan condos for portfolio diversification and long term return-on-investment.
1) Identify the right buy based on objectives
2) Manage the buy process
3) Rent out the property
4) Manage tenants
5) Market the property at the eventual sale
Wei Min’s media interviews by CNBC, CNN, New York Times on the subject of investing in Manhattan property
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Historical trend of the 30 year fixed mortgage rate
Manhattan freehold condo with attractive rental returns