The Perfect Storm

Historically, Spring is the busiest time of the year for home buying. But, for the second Spring Season in row homes across the country are not selling. Except that is in NYC where we are seeing double digit increases in both prices and number of transactions going into contract.

Manhattan Coops now average $685,000 which is an increase of 14% over May 2009. Condos are now averaging $1,200,000 which is an increase of 13% from last May. At the same time, Brokerages here in the city are announcing increases of between 12 and 15% in the number of contracts being signed.

No one could have predicted this amount of business if you had asked them a year ago. The Dollar was gaining strength against the Euro, consumers were still nervous about Wall Street and many of the so called experts were still talking about further decline in real estate prices.

Then came March 2010.....we went to bed one night in a strong buyers market and woke up the next day with sellers seemingly in charge and deals be done in bunches. The biggest problems we are having at Bond is not having enough agents to handle all the buyers and not having enough hours in the day to get all the deals processed.

No one can predict how long this frenzy will last. Interest rates keep dropping, prices are starting to rise, jobs are being created in various different sectors and demand is up. Also fueling the sales market is a rental market with decreasing inventory and increasing rents. All in all its a Perfect Storm to produce a hot market....lets hope it lasts for a while.