2024 New York City Real Estate Market Outlook

2024 Residential Market Outlook for Manhattan

Enclosed are our key takeaways for the 2024 Manhattan residential real estate market.

As always, you are invited to schedule an annual equity valuation for your property and call us to discuss any specific questions you may have. 

A 20,000 Foot View of the Market

In a period of unprecedented fiscal tightening and a turbulent geopolitical environment, the Manhattan real estate market has lived up to its reputation as a stable source of value for real estate owners.  

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During 2023, the market saw lower buyer traffic and a decline in listing inventory. The average price per square foot marketwide is down ~8.2%. This drop in prices reflects the sharp decrease in purchasing power caused by the rapid rise in mortgage interest rates. 

Despite lower buyer turnout throughout the year, the buyers who did show up were as serious as you can find. This has been a bright spot in the market with very few “tire kickers” in the mix. For savvy buyers, the period between January and March 2024 will bring great opportunities due to lower levels of competition prior to the spring market rush. 

Lower inventory levels have helped bolster prices, but frankly,  there is not a lot of high quality resale inventory available. 

The luxury market of $4m+ properties saw nearly 1,200 signed contracts, representing an 8% decline from 2022. 

Sellers who have been committed to selling and are realistic on pricing have had success. Buyers who are well educated on the market can spot well priced properties immediately and move quickly on them. 

For sellers, the primary storyline has been whether to list or not to list. The vast majority of sellers are suffering from golden handcuffs as a result of being locked into trophy interest rates on their existing mortgages at 3.5% or below. Despite this, real estate is personal and life circumstances will always take priority over a trophy mortgage rate as sellers continue to retire, get married, grow their family, and rejoice in being empty nesters. 

Renovation ready properties remain by far the best buying opportunity in the market as the time, cost, and effort for buyers to take on renovation projects remain a hurdle, unless the value proposition is exceptional.  

Finally, if mortgage interest rates continue to decline into Q1-Q2 2024 there will be a tailwind to drive a strong spring market. 

The Market in Three Simple Charts


Supply is the total number of units active for sale. Inventory has the strongest impact on the market moving up or down. 

When supply levels are low, more buyers are competing for the same properties, and as a result, there is upward pressure on prices. When supply levels are high, properties sit on the market for longer, and buyers have more options to consider. With increasing supply there is an increased likelihood of the buyer being able to negotiate a greater discount for the property.

Supply for Manhattan properties is down 3.6% year over year. Zooming out, we are in the middle of a 5-year range where inventory has been fluctuating between 6,000 and 8,000 units. The trend is currently down.

For 2024, we expect the supply of available properties in Manhattan to bounce between 6,000 and 7,500 units, moving with the flow of seasonality in the market. 

Takeaway: Supply is currently at multi-year range lows. Inventory is being absorbed, albeit at a much slower rate than we were seeing last year. This lack of supply has been a stabilizing force for the market. 

Buyers and sellers have a level playing field for the time being. If interest rates continue to trend down, then we expect the market advantage will turn to sellers. 

Pending Sales


Pending sales track the number of listings currently in contract waiting to close. The more pending sales there are, the “hotter” the market is. The fewer pending sales, the slower the market is. 

At the time of this report, pending sales are at 2,456, which is up ~41% year over year and equivalent to levels from 2019. 

Buyer traffic is understandably not as robust as it has been in previous years. However, the buyers we are seeing are more serious about purchasing. We are also seeing a higher proportion of cash buyers shopping. 

Buyers who have stepped aside for the time being represent the pent up demand which will come through the market pipeline at some point down the road. 

Takeaway: With the dramatic rise in mortgage interest rates since the summer of 2023, properties under $2m have adjusted the most in terms of discounts. As a result we are now seeing buyers stepping in to take advantage of these highly discounted deals. 

Market Pulse


Market Pulse is the ratio between pending sales (demand) and supply. For reference, anything over .50 is considered to be a sellers’ market, and anything below .30 is considered to be a buyers’ market. Currently, we are at .41 and trending up (neutral market). 

The front half of the year gave buyers the market advantage. Since mid year, inventory has been absorbed and we have transitioned into a neutral market. It remains to be seen if the trend will break out into a sellers’ market or stay range bound. 

Takeaway: Buyer opportunities have likely bottomed out. Sellers are patiently waiting for the advantage back. 

Bullish Market Factors for 2024

  • For 2023, rental inventory is up 13% to 25% depending on the price point. Rental prices have been mostly flat but are well off their highs. High rental prices continue to provide a compelling reason for first time buyers to consider purchasing as an alternative to renting.  
  • We are this-much closer to the “Fed Pivot.” Presidential election years typically encourage loose fiscal policy to keep voters happy. 
  • Inflation is manageable and trending in the right direction. How sticky these last basis points are will remain to be seen. 
  • Cryptocurrency markets are back in bull market territory and should remain there for the next 18-24 months. Some of this extraordinary wealth will enter the market, most likely by 2025. 
  • Mortgage interest rates have been trending down. This could be a tailwind for the market if the trend continues. If the economy manages to avoid a much-predicted recession and consumers remain strong, the wealth effect may come back into play and drive Manhattan sales once again.
  • Baby Boomer Wealth Transfer will ultimately bring $80 Trillion dollars into the economy over the next 20 years. Some of this money has and will continue to find its way into real estate. Baby Boomer assets will continue to work their way to the next generation in the form of family gifting. In addition, Baby boomers will continue to purchase and sell super luxury real estate in Manhattan themselves as you can’t take it with you. 
  • The New Development pipeline coming to market in 2024 remains modest. This will play a role in keeping supply at reasonable levels and upward pressure on pricing – especially for relatively new condominium resales, such as those  in <8 year old new development projects. 
  • Return to the office. If Manhattan workers continue their return to the office, Manhattan’s real estate could see increased demand from current commuters or those looking to remain in vibrant, urban neighborhoods. 
  • Home prices in America’s 20 largest cities rose 6.4% in 2023 (S&P Global Case-Shiller). This is the fastest pace since December 2022. 

Potential Market Obstacles for 2024

  • 2024 is a Presidential election year. Traditionally, this presents as a slower market in the back half of the year as buyers and investors tend not to like making large financial decisions until they understand what fiscal policy will look like for the next four years. During these periods we typically see a drop in both supply and demand. 
  • Geopolitical turbulence is never good for real estate markets. 
  • Potential that the US economy does experience a “hard landing”. While this does not mean real estate will have a down year, it does influence consumer confidence and spending. 
  • A slower pace of mortgage interest rates adjusting below 7% could continue to put a drag on buyers shopping in the $3m and under price category. 
  • Real estate returns are often tied to the stock market sentiment. If the S&P reverses course, so too could the real estate market.
  • With fizzling occupancy rates, a commercial office black swan type of event could derail not just the real estate market but the financial markets as well. Office building sale prices are well off their highs and nearing 20-year lows. In some cases, office buildings are being valued based on the land they sit on. While we don’t see an office market collapse as a likely event, it is in the realm of possibilities. 
  • Lack of inventory coming to the market will keep prices high along with historically high interest rates which will result in a muted market. 

*All data points referenced are as of year end 2023 and provided by Urbandigs.com

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