As we head into the fall season, the New York City real estate market feels like it’s standing at a crossroads. On one hand, we’re seeing signs of stabilization, rates are trending slightly lower, buyer sentiment is warming in some pockets, and luxury deals haven’t missed a beat. But on the other hand, the broader market, particularly the sub-$4M space, is still in a bit of a holding pattern. It’s shaping up to be a fall where things could break either way, and if they do, they’ll move fast.
Seasonality Snapshot: A Shorter Season, But Not Without Momentum
Fall is always the shorter of the two major NYC selling seasons. In Manhattan, we’ve averaged about 3,387 closed sales during the fall, compared to 4,751 in the spring over the past five years, which is a 40% drop. That thinner deal volume tends to mean a more selective buyer pool, tighter timelines, and, occasionally, more negotiability.
But shorter doesn’t always mean slower. The urgency of the fall season often stems from buyers and sellers trying to finalize deals before year-end. If you’re planning to come to market, timing and strategy are everything right now.
Courtesy of UrbanDigs
A Split Market: Luxury Outperforms, Sub-$4M Hesitates
One of the clearest storylines of 2025 is how bifurcated the market has become. The Luxury ($4M+) is holding firm. In fact, it’s been outperforming expectations since early 2023. This could be driven largely by all-cash buyers who aren’t fazed by rate volatility.
Meanwhile, the sub-$4M segment has underperformed for the third year in a row—potentially due to higher financing costs, affordability ceilings, or an overall sense of “wait and see.”
This chart tells the story well—demand is heavily concentrated at the top, while the mid-market continues to lag:
Courtesy of UrbanDigs
Buyers Still Favoring Renovated Units
There’s still a clear divide when it comes to property condition. Buyers are showing a strong preference for move-in ready, well-renovated listings—especially if they’re priced close to the market. If your listing needs work or is priced aspirationally, it has a much higher likelihood of lingering on the market and/or eventually seeing a price cut. Today’s buyer pool is smaller and many of them are still cautious.
Inventory Moving Upward
Right now, Manhattan’s weekly new listings are starting an expected post-Labor Day jump. Up 3% since last week and 6% more than this time last year.
If that inventory continues to increase without matching buyer engagement, we could see pricing pressure by November. But if demand picks up quickly, especially for turnkey homes, sellers may regain some leverage heading into Q4.
Courtesy of UrbanDigs
Rates Trending Down
Yes, rates have come down a bit, with 30-year mortgages hovering in the mid–6% range. It’s possible this could get some buyers in the under $3M market in motion.
If things continue in this direction, and we get a sustained drop into the low 6s or even high 5s, it could lead to the demand side really opening up. Until then, buyers who need financing are still more likely to stay value-focused and cautious.
Courtesy of UrbanDigs
What to Watch Right Now
If you’re considering the current market, here are the three key indicators we’re watching closely:
1) Inventory Growth Rate
Are sellers coming to market faster than buyers are responding?
2) Contract Activity in October
If new listings aren’t translating to deals, we may see some softening.
3) Mortgage Rate Movements
A dip below 6% could revive demand. But if it’s rate cuts tied to negative economic news, that could just as easily spook the market.
Also don’t forget, we’ve got a mayoral election coming up, which may stir up some additional late-year uncertainty.
For Sellers
Be realistic about pricing. Value and condition matter more than ever. If your home shows well and you price to meet today’s demand—not last year’s comps—you can still win.
For Buyers
If you’re sitting on the sidelines waiting for a crash, don’t count on it. But if something shifts—rates, inventory, or confidence—it could unlock opportunity quickly. Be ready to move if the right listing hits.
This fall market is poised to shift quickly—and we’ll be tracking the numbers and keeping you posted as it unfolds. If real estate is on your mind, feel free to contact us anytime!