The Look of Autumn

THE first anniversary last week of the Lehman Brothers collapse was a grim milestone. During the financial meltdown that followed, markets across the globe were roiled. New York real estate did not escape unscathed.

 

Activity was basically frozen through the winter, and the customarily busy spring season was slow. In the summer, when the market usually becomes sluggish, contract signings finally picked up.

 

That left everyone wondering what to expect from the fall.

 

Traditionally, there is a modest bump in the number of apartments listed for sale the week after Labor Day. But professional and amateur market watchers worried: What would it mean if this year was different? Would an avalanche of new listings be the equivalent of a last-ditch effort from sellers?

 

If few were added, would it mean owners had no confidence that they could sell anything?

 

So far, the market appears to be behaving much more normally this fall than it did over the last 12 tumultuous months. A comparison of data from two of the city's largest real estate brokerages and two Web sites that follow the industry shows that the number of listings added in Manhattan after Labor Day was similar to last year's.

 

"Seasonally, this is the expectation," said Jonathan Miller, the president of the appraisal firm Miller Samuel. Because the listing level is considered normal, he said, "we see it as a sign of confidence, that consumers are willing to see this as a market they can sell their property in." Although he said it made sense to be happy for the good news, it didn't mean that the boom times had returned, only that the steep decline had abated.

 

"It shows we're going in a better direction," Mr. Miller said. "I think that direction is sideways as opposed to through the floor."

 

The stabilizing of inventory does not mean that sellers will be getting the prices they received a year or two ago. New data from StreetEasy.com suggests that asking prices are about 24 percent below levels last year at this time.

 

Both NYTimes.com and StreetEasy had more than 450 new listings in Manhattan the week after Labor Day. StreetEasy said the increase of 462 apartment listings was similar to the jump last year after Labor Day of 472.

 

According to Mr. Miller, inventory for August of this year - which clocked in at 8,423 co-ops, condos and town houses - was only 2.8 percent higher than for the same month last year. But the ride from August to August was a roller coaster. Inventory started to pile up last fall, and when it peaked in March, there were more than 11,000 units on the market - 34.7 percent more listings than in August of 2008.

 

"The second quarter was very bleak," said Sofia Kim, the vice president for research at StreetEasy. "Nothing was moving."

 

"The three things we're watching for are prices dropping, transaction activity and inventory," Ms. Kim said. "What we saw this summer was transactions going up; inventory looks like it's stabilizing; the only thing of concern right now is prices are still dropping."

 

About 40 percent of the new listings in Manhattan after Labor Day were condos and 60 percent were co-ops, according to StreetEasy. One-bedrooms had the largest inventory increase, at 171 new listings, followed closely by two-bedrooms, at 160. There were 65 newly listed studios on the market and 50 three-bedroom apartments. Homes with more than three bedrooms saw the smallest bump, with only 16 new listings the week after Labor Day.

 

Asking prices, meanwhile, were way down from previous years, according to StreetEasy. The median asking price for the week that ended on Sept. 13 was $860,750. The week after Labor Day 2008, the comparable figure was $1,100,000. After Labor Day 2007, it was $1,050,000.

 

The week after Labor Day in 2007, studio apartments new to the market were listed at a median price of $525,000. The next year, the median price was $429,000. This year, it was down to $399,000.

 

Over that same period, new one-bedrooms went from $785,000 to $775,000, and are now down to $675,000.

 

Two-bedrooms went from $1,412,500 in 2007, up to $1,599,500 in 2008 and then down to $1,250,000 this year.

 

Neither NYTimes.com nor StreetEasy could provide year-over-year data for the boroughs outside Manhattan on prices, inventory or the number of new listings.

 

Ramon and Carly Alvarez staged their first open house last Sunday for the two-bedroom Upper West Side co-op they have just put on the market. Even though they moved to New Jersey in early August, they decided not to list their apartment until after Labor Day.

 

"There is that fear of it getting stale, knowing half the buyers were going to be out of town," Mr. Alvarez said. "When the same apartment's been sitting there for a long time, you're like, `Well, what's wrong with it?' "

 

The Alvarezes' agent, Andrea D'Amico, a vice president at Corcoran, advised them to hold off on the listing until after the summer.

 

"If you list this at the beginning of August, when everyone's away on vacation," Ms. D'Amico said, "then it will sit here with no traffic and suddenly people walk in after Labor Day and it's been on for a month. Then people think, `It's really time to negotiate.' "

 

A search of Corcoran's database, including exclusive and nonexclusive listings, showed that the Alvarezes had lots of company on the sidelines during the summer. It found 426 new listings for the week ended Sept. 13. That same search showed 518 new listings the week after Labor Day in 2008 and 563 new listings the year before.

 

"In the last year, many people held their apartments off the market," said Pamela Liebman, the chief executive of the Corcoran Group. "I think it's a good sign that we're getting a normal number of apartments on after Labor Day." Sellers, she added, have become used to the idea of lower prices.

 

When Mary Stone and her husband, Channing Creecy, first put their one-bedroom Upper East Side co-op on the market in March, they were testing the waters.

 

"There were good options to buy a house or to upgrade," Ms. Stone said, "but there wasn't an urgency to it."

 

Now Ms. Stone is pregnant. She and her husband have decided that it's time to move to the suburbs.

 

In the spring, their apartment was listed for $649,000. They took it off the market at the end of July. Using an apartment that recently sold in their building as a guide, they just relisted it, this time for $575,000, with Patty Lehan of Prudential Douglas Elliman's Shemesh Group.

 

"We didn't know exactly what the right price was," Ms. Stone said of the earlier figure. "Now we have more clarity."

 

In past years, apartment prices in Manhattan were practically dictated by buyers with huge Wall Street bonuses. But that era is over, at least for now.

 

"With bonuses, the general consensus is that it's never going to be what we had," said Dottie Herman, the president of Prudential Douglas Elliman. "But it was mad money. It was unreal."

 

According to Ms. Herman, Prudential experienced a spike of nearly 35 percent the week before Labor Day this year over last. But the next week, listings were down about 30 percent from 2008's numbers. So, she says, things are about the same as last year.

 

"To be really healthy," Ms. Herman said, "you don't want to be at either extreme. You don't want to be in the market we were in a few years back when there was no inventory, but you also don't want to be at the opposite of that."

 

A good job market is essential to a healthy real estate business. After dipping slightly in July, the national unemployment rate inched close to 10 percent in August, hitting a high of 9.7 percent.

 

Movements in the job world, along with events like marriage, divorce, birth and death, also dictate what happens in real estate.

 

Sheri Whitko Desai, a photographer, and her husband, Anar Desai, who works in technology sales, are moving to Chicago for work. Their Brooklyn Heights apartment is on the market.

 

Their real estate agent, Jon Varnedoe, an associate broker at Prudential Douglas Elliman, held the first open house last weekend.

 

"This is a special place to us," Ms. Whitko Desai said.

 

The one-bedroom was the first home either of them had ever owned, and Mr. Desai proposed to her on the balcony the day they closed on the apartment three years ago. They paid $530,000.

 

"We're cautiously optimistic," Mr. Desai said. "Everyone knows what's been going on this year in terms of the economy, but it looks like people are getting back in. And people are beginning to look at real estate differently," he added. "It's where you're putting your savings and your nest egg, not necessarily something you'll get a quick hit off of."

 

The apartment is listed for $575,000, and Mr. Desai says his hope is to break about even after fees and taxes, rather than make a killing .

 

"In many ways, it's going to be a healthier market," said Hall Willkie, the president of Brown Harris Stevens. "It will be more affordable to more people, which is more sustainable. A lot of money was made during the boom years," he said, "but I don't know if it's such a great world when people with good jobs and a good income can't buy a home. I don't think we're going back there for a while."

 

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