Perception vs. Reality in Manhattan Real Estate

Here is a selection of email subjects found in my Inbox in just the past 10 days:

  • “Seller Says Sell”
  • “Priced to Sell”
  • “Price Drop”
  • “Price Reduction”
  • “Price Improvement”
  • “New Asking Price”
  • “Price Slashed”

The obvious perception of anyone receiving these emails would be that the market is softening and perhaps even tipping in favor of buyers. Just ask a buyer currently searching for a ManhattaPerception Blogn property if this is in fact their reality and more often than not you will hear a resounding, “NO!” In fact, take a look at UrbanDigs most recent analysis of the days on market in multiple price points that make up Manhattan’s real estate landscape. A quick glance at all of these price points show a clear divide between the market above and below $5M. I would argue that agents representing sellers in the higher end of the market have had a greater tendency to overprice than those in the under $5M market.

So what IS happening? Buyers are no longer blindly bidding on overpriced properties and some real estate agents, scratching to survive in an ultra-competitive market, have continued to escalate prices to a level that has finally become unpalatable to the consumer. Sellers who have priced their property in line with current market conditions, comparable unit sales, etc. have seen greater success than those who have listed with agents who sold them a dream. The perception of a softening market isn’t reality, it’s more a story of overpriced inventory searching for more realistic selling prices. Unfortunately for the price dropping sellers, they have likely left considerable money on the table by not pricing properly right out of the gate.

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