T
he Federal Reserve's rate cut brought relief to the Manhattan real estate market, but it came too late to boost sales in the third quarter. According to Miller Samuel's report for Douglas Elliman, condo and co-op sales fell 3% year-over-year, from 2,900 to 2,800. Transactions remain about 10% below the decade average.

    However, with more expected rate cuts on the horizon and mortgage rates continuing to drop, a surge in sales is likely. Report author Jonathan Miller notes that downward pressure on mortgage rates over the next six months will boost sales activity. This trend is already reflected in monthly reports, which show new signed contracts across condos, co-ops, and one-to-three-family homes rose 19% annually in September.

    Inventory held steady in the third quarter, with active listings dipping from 7,300 to 7,200. Listings have fallen or remained stagnant in Manhattan for five of the last six quarters, unlike other nearby markets where inventory was decimated after the pandemic buying frenzy. However, Miller cautions that inventory levels may dip lower as sales activity is poised to outpace listings coming on the market.

    Cash deals accounted for 56% of sales last quarter, marking the lowest share in two years. The falling metric comes after cash purchases reached decade highs in 2023 due to elevated mortgage rates. Just under 10% of home sales resulted in bidding wars last quarter, with Miller attributing the uptick to overpriced listings on the market.