The fourth quarter of 2009 started fairly strong and petered out as we got into the holiday season. Midtown prices have not adjusted as much as some of the primary areas, reflecting some end-of-year pricing reality. What we are seeing is that when properties are well-priced, buyer activity and sales are fast and assured. If a property is not well priced and perfectly presented, "do not pass go, do not collect $200.”
Total inventory is a bit tight and sales are occurring mostly in the moderate end of the market, with the very high end still on hold. Mortgage interest rates below 5% have helped, but we have not seen much of an impact from the Federal tax rebate programs; most buyers in the Manhattan do not qualify because income levels are above the mandated thresholds. Foreclosures are still scarce, but concessions from sponsors and distressed private sellers are obvious.
Sellers have to price their properties right, and brokers have to work extra hard – and still, both need to get lucky to get the proper buyer and have the sale go through. Financing is getting tougher and longer, and everyone involved is requiring that all the T’s are crossed and the I’s are dotted.
We see the fourth quarter of 2009 as just an inflection and believe that 2010 will present a slow but steady ride upward both in inventory, prices and activity. As they say, be greedy when others are fearful and fearful when others are greedy.