In Manhattan, the second quarter was a tale of two residential markets.
More cash buyers traded condos and co-ops at the high-end of the market, fueling a record high share of cash deals in the borough and a sizable increase in sales, according to Miller Samuel’s quarterly report for Douglas Elliman. The uptick in activity pushed prices upward, while listing inventory declined sharply as buyers scooped up available homes.
At the lower end of the market, competition was much less fierce. While the number of transactions also rose last quarter, prices remained relatively stable and inventory increased modestly.
Most buyers who financed their purchases with a mortgage did so with a contingency, which report author Jonathan Miller pointed to as a sign of the market moving at a slower pace.
“In a tight market, that doesn’t exist,” said Miller, who described the market in the second quarter as “highly polarized.”
Miller attributed the discrepancy to strong performance in the financial markets, which is sparking wealthy buyers to purchase homes in all-cash deals, and high mortgage rates, which are restraining activity for buyers who rely on financing.
“The market is getting wider in terms of behavior,” Miller said. “Cash buyers are less dependent on mortgage rates, so rates being stuck doesn’t seem to be a big issue.”
Manhattan’s luxury market — defined in the report as the top 10 percent of co-op and condo sales — outpaced the overall market, with the number of closed sales rising 18 percent year-over-year, compared to 16 percent. Luxury listing inventory dropped more than 21 percent compared to a 3 percent increase overall.
Cash deals accounted for 69 percent of transactions in the second quarter, the largest share on record since Miller started tracking the data more than a decade ago. The number of cash buyers increased by 23 percent. While financed deals comprised roughly 30 percent of transactions, 80 percent of those sales were contingent upon the buyer securing a mortgage.
After achieving a record high last quarter, the average sale price of luxury condos and co-ops rose to $8.6 million, up 7 percent from the same period in 2024, though lower than the more than $10 million average sale price logged in the first quarter.
The median sale price for the luxury sector rose to $6.5 million, a nearly 9 percent annual jump. In the overall market, the metric increased to $1.2 million, less than a 2 percent uptick year-over-year.
Last quarter brought a boost of activity to Manhattan’s market — a departure from others in the suburbs surrounding New York City, where lackluster sales permeated the period, Miller said. Economic uncertainty resulting from what Miller dubbed the Trump Administration’s “tariff tantrums” has pushed buyers and sellers in neighboring markets to the sidelines.
“On the ground, the sentiment of the brokerage community over the last couple of months has been fairly negative,” Miller said. “But the results in the report were relatively strong, stronger than I expected.”
But Miller anticipates the uncertainty to be more evident in the third quarter, as nearly half of the contracts that closed in the second quarter were signed before the tariff policies took effect.
“The second quarter would have seen more robust sales were it not for the uncertainty caused by the tariffs,” Miller said.
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