With fewer sellers in the market, New York City residential brokers have — inadvertently — found themselves taking on substantially more buyers as clients. Right now, they are working with extremely eager buyers which would normally be spent handling their listings. One broker said that she’s working with 45 to 50 percent more buyers than she was before the market tightened. Like her, many feel that they have not had a conscious choice in the matter. It depends on the climate and the climate has changed. Another broker said the number of buyers he’s working with has also increased about 50 percent over the last three months. He also notes that most of his colleagues are agreeing to work with more buyers, too.
Buyers feel that they need to purchase now while sellers, on the other hand, see that the market is getting stronger and think they should wait. These two parallels of strength are causing extremely low inventory and very hungry buyers. There are also strong indicators that prices are going to continue increasing. The extreme lack of inventory in the market has prompted many brokers to shift not just their clientele but also their strategies for doing business.
For starters, it means that competition to score the limited number of for-sale apartments as listings has increased, largely because those assignments are almost guaranteed sales — as long as they’re well-priced, that is. But it’s also requiring brokers who are representing buyers to work harder than usual. They’ve had to become very proactive and creative in finding apartments for their clients to see — whether it’s expanding their criteria or writing letters to owners in a particular building. Also, keeping the buyers engaged during the extended search process has become a major part of their work schedule.
According to the latest market report for the first quarter of 2013, the listing inventory in Manhattan fell by 34.4 percent year-over-year to 4,960 units from 7,560. Meanwhile, the number of sales dropped quarter-over-quarter to 2,457 in the first quarter from 2,598 in 2012’s fourth quarter. The lucky brokers who do get listings in this market have a huge advantage, sources say. Their goals should be to get high offers and more buyers in the door, they add. With this type of market condition of little supply and larger demand, it means that there are going to be more successful sales for sellers.
However, agents who are used to working only on exclusives have been forced to develop new strategies for dealing with these unique market conditions. Some say that they’ve had to go back to the old-school approach of aggressively working the phones to try to get new exclusives versus waiting to be contacted by new or former clients.
Because it’s a seller’s market, they’ve had to rev up their seller representation and push harder on new exclusives. Some have found it advantageous to reach out to former clients who purchased properties during the boom, explaining to them why selling now would be profitable.