What one factor could make or break the spring season
Like the rest of the country, the New York City real estate market saw some ups and downs in the first quarter of 2026.
Lower interest rates to start the quarter gave way to a spike in rates over the final six weeks, which likely was one of the reasons for lower sales numbers in Q1.
Coldwell Banker Warburg released its NYC market update for the first quarter on Thursday, and it showed a mixed picture, with some quarterly improvement but year-over-year declines.
Sales were down for the first quarter when compared to Q1 2025. In Manhattan, the company had 2,458 closed sales, down 15.9% from the previous year. In Brooklyn, there were 2,152 closed sales, down 20.2% year over year.
Even with sales down, prices continued to increase. Manhattan median prices reached $1.285 million, up 8% from Q1 2025 and 10.8% from Q4 2025. Brooklyn’s median price was $1.009 million, down 2.2% from last year but up 1.2% from the fourth quarter.
One silver lining in the report was an increase in inventory in the city, which one agent said could set things up for a strong second quarter.
Kevelyn Guzman (pictured top), regional vice president of Coldwell Banker Warburg, is hopeful that the spring buying season could be a successful one, despite the higher interest rates.
“The market seems to be recalibrating rather than slowing down,” Guzman told Mortgage Professional America. “Inventory was up almost 20% quarter-over-quarter, so buyers have more options, but price per square foot remained more or less the same, as did discounting. The combination of increased supply but unchanged prices sets things up for a competitive, and hopefully healthier, spring market.”
Inventory on the rise
One of the biggest problems in many metropolitan markets has been a lack of inventory. Despite reports that sellers outnumber buyers by a large margin nationwide, housing markets are very localized. Big cities are often still struggling to get enough inventory on the market to attract homebuyers at reasonable prices.
“The underlying tone of Q1 is one of quiet confidence,” Guzman said. “Days on market compressed from last quarter, and discounts remained contained, meaning sellers who priced correctly found their buyers.”
In Manhattan, the company noted 6,014 listings in Q1, down 9.5% from last year but up 19.7% from Q4 2025. Brooklyn saw a jump as well, posting 3,362 listings in the first quarter. This was up 1% from the same time last year and 12.3% from Q4.
While inventory saw a large jump from Q4 to Q1, the question remains how much of that inventory was simply taken off the market at the end of the year and relisted to start 2026. The fact that overall inventory was level or down from Q1 2025 underscores the need for continued increases in available real estate.
“The spring setup looks constructive: more supply, steadier pricing, and a patient yet engaged buyer base,” Guzman said. “The more interesting question heading into Q2 is whether that new inventory arrives well-positioned to meet the demand that has been building.”
Impact of higher rates
For mortgage brokers who work with clients in New York City, the current state of the market has left homebuyers in two categories. Some buyers and refinancers are willing to proceed regardless of interest rates, while others are hesitant due to higher rates and global uncertainty.
Melissa Cohn, regional vice president at William Raveis Mortgage, told Mortgage Professional America that brokers will likely have customers on both sides of the fence, with some ready to move forward regardless of what’s going on around them.
“I think it's sort of the tale of two cities right now,” Cohn said. “There are some people who are just like, ‘I want to see what's going to happen. I'm nervous about what's going on in the world. I'm not jumping into anything.’ And then there are other buyers who seem to be oblivious to the fact of everything that's going on in the world.
“It always surprises me, but I'm not surprised by it. Because of my business and because I am so closely tied to what goes on in the financial markets, I'm always very aware of what's going on. But people who have a job and get a paycheck, and as long as their paycheck is not being impacted, they don't really seem to care as much as you would hope about what's going on across the world.”
While some homeowners were considering a refinance when rates dropped into the 5s, many of them are now waiting to see if rates will come back down again.
“People who were planning to refinance, now it's not happening,” Cohn said. “Except those people who had rates in the high sevens, because even at slightly higher rates, it is still a good opportunity.”
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