From the New York Times:
After five years of paltry inventory, rising prices, and bidding wars, the seller’s market has finally started to turn into a buyer’s market—or at least the beginning of one. According to a report released this summer by appraisal firm Miller Samuel, the number of sales last spring—traditionally the busiest season—were down 14.8 percent from the year before. A typical home now sits on the market for 144 days, 42 days more than the previous year. And while the average sales price of a Manhattan apartment so far this year is $1.38 million, 5 percent higher than last year, prices aren’t accelerating anywhere near as high, or as fast, as they did in 2004, when appreciation clocked in at 30 percent. Futures traders at the Chicago Mercantile Exchange forecast that New York City prices will fall 6 to 8 percent by next August, while our own city’s most recent budget report predicts sales volume and prices will sag for the next four years.
All of this adds up to what Jonathan Miller calls “a market in transition”—though the rest of us might call it confusion. Those who own homes—particularly those who bought at the exuberant height of the market—are wondering if now is the time to cash out and take cover in a rental. Some sellers are still getting bids within a day of putting their homes on the market, while others are watching weeks turn into months. Some, in a hurry to unload, are slashing prices twice and three times.
Buyers too, meanwhile, are wondering whether to take advantage of the market’s favorable turn, or if there will be even better deals in six months. Alyssa Gelper, a lawyer who abandoned her search for a two-bedroom, two-bathroom apartment last spring (“I didn’t want to be the last sucker to buy high before the market tanked”), has decided the waters are safe to wade in: She just started poring over listings last week. Open houses no longer feel like cattle calls, and buyers who luck into something they like don’t need to steel themselves for a battle of best offers.
In a very short time, the rules of the real-estate game have changed dramatically—and buyers are more in control than they have been in a while. “They’re taking their time, and they’re not afraid to make an opening offer that’s 10 to 15 percent off the asking price,” says Corcoran’s John Gasdaska.