September 2021 Manhattan real estate market update
Posted by Wei Min Tan on September 7, 2021
The key points to note in the September 2021 Manhattan real estate market update are:
1. Limited sale supply
2. Low mortgage rates
3. Hot rental market
Supply peaked in November of last year and it has been going down ever since. In the latest Manhattan market tracking, active listings on the market is currently at 6,099. The challenge right now for a buyer is that there is not enough supply on the market. Weekly new listings are much higher than historical averages but they were being absorbed at a much faster pace than the new listings coming out. This is the reason why the net effect is a decrease in supply driven by very low mortgage rates.
30-Year Fixed Mortgage Rate
Back in the 1980’s, the 30-year fixed mortgage rate was higher than 16% and it has been going down since then. We have been in a low rate environment for the past several years and the 2021 average at this latest market update is at 2.9%. Compared to the historical trend, we are at a very very low rate. Having a 30-year mortgage is unique to the U.S. You can lock in your mortgage payment for the next 30 years, which is amazing from a property owner’s perspective. This is why buyers are coming in and locking in the low rates.
Manhattan Rental Market
The September 2021 Manhattan market shows that the rental market is very hot. The number of new leases has increased by 54.7 percent from last year. Why? It’s because a lot of people didn’t renew their leases last year because of work from home policies and now, companies are calling employees back to the office. So everyone is moving back into Manhattan.
One-bedroom sales volume went up by 59.3 percent, two-bedroom sales volume went up by 33.4 percent and three-bedroom sales volume went up by 20.6 percent. The average rental price and rental price per square foot for a three-bedroom apartment increased by 17.2 percent and 10.9 percent respectively. This goes to show that there is a lot of rental demand from people coming back to Manhattan.
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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
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Historical trend of the 30 year fixed mortgage rate