Declining Inventory Drives Up Competition for NYC Homes

Competition for New York City homes intensified in the late summer months, with more properties selling above asking price than a year earlier, often an indication of bidding wars.

One in five properties in the city, about 22 percent, traded for more than their last asking prices, up from 21 percent a year earlier. Though the increase was relatively marginal, it indicates sustained momentum from July, when 25 percent of homes sold above asking — the highest share since 2022, according to a StreetEasy report published earlier this week.

That share was even higher in Brooklyn, where 32 percent of homes traded above their asking prices in August. That uptick was driven, in part, by deals in neighborhoods such as Park Slope, which had the highest share of above-asking home sales of any neighborhood in the city at more than 61 percent.

In Manhattan, 16 percent of properties sold for more than their asking prices, and more than 24 percent in Queens. Of the three boroughs, properties in Brooklyn also had the shortest median stints on the market, with the typical home entering contract in a little over two months, compared to more than three months in Manhattan.

“I’ve personally been involved in five highest and best situations this year with buyers, which usually means you have three or more people bidding,” the Agency’s Mike Fabbri said, adding that it can be a risky move for sellers, though one they often rely on when they think their homes will sell above the asking price.

Competition likely grew fiercer because there were fewer homes to buy. Across the city, inventory fell 5 percent in August compared to the same month last year. In Manhattan, that drop was more pronounced, with supply declining 11 percent year over year, while inventory levels remained relatively steady in Brooklyn.

“It’s a scarcity issue,” said Douglas Elliman’s Frances Katzen, attributing the lack of inventory to a perfect storm of rising mortgage rates keeping would-be sellers on the sidelines and a shrinking new development pipeline. “There’s just not enough.”

Fabbri agreed with Katzen about the scarcity of inventory, though he argued rising competition was less a factor of no supply but rather the quality of supply available.

“People say ‘inventory crunch,’ but it’s really a shortage of apartments that people actually want to buy,” he said. When a well-priced home in a good location comes on the market, “it’s super competitive.”

“It’s a self-perpetuating problem,” he went on. “People who would be selling are holding onto their homes longer because there’s a lack of good product that people want to trade up into.”

In case you missed it…

Corcoran CEO Pam Liebman turned up the dial in the company’s fight over private listings in New York City.

During a town hall, the executive encouraged agents once again to pull their listings off of StreetEasy and offered brokers a $1,000 advertising budget per listing removed from the platform. On the call, Liebman said the firm was spending “$1 million a day to give you the backup that you asked for to push these listings.”

The meeting came as Corcoran and other brands under the Compass International Holdings umbrella released ads boasting “thousands of homes for sale not on Streeteasy” and directing consumers to search on their websites.

Earlier this summer, Liebman and Compass International CEO Robert Reffkin held a series of meetings with top agents in the city where they suggested brokers remove their listings from the listings platform during the month of August. Last month, StreetEasy updated its Experts program, preventing agents from companies that make up at least 20 percent of the program from joining, which only includes Compass International.

“This is our moment,” Liebman said on the call. “If we win this battle, we win the war. If we lose this battle, we will be at the mercy of this portal for now and forever.”

NYC Deal of the Week

The most expensive deal to hit the city rolls this week was for a penthouse at 555 West 22nd Street, which closed for $27.5 million. The 6,300-square-foot new development apartment has four bedrooms and four full bathrooms and was sold as a “white box,” according to the listing.

Penthouse 24 is one of 144 units at the Cortland, developed by Related Companies and designed by Robert A.M. Stern. Sales launched at the project in 2024 and are being led by a Corcoran team, including Noble Black and Steven Cohen.