The Manhattan real estate market demonstrated significant strength in the third quarter of 2025, with key metrics showing robust growth despite wider economic and political uncertainties. According to a new market report, sales reached a three-year high, and the median price for a home climbed to a post-pandemic record of $1.225 million.
This performance marks the third consecutive quarter where all major price indicators have risen, a trend not observed since 2022. The data suggests sustained buyer demand, particularly in the luxury segment, is continuing to drive the market forward.
Key Takeaways
- Record Pricing: The median sales price in Manhattan reached $1.225 million, a 7% increase from the previous year and a new post-pandemic record.
- Strong Sales Volume: Total sales volume grew by 10% year-over-year to $6.56 billion, fueled by 3,281 closed transactions.
- Consistent Contract Growth: Contract activity increased for the sixth straight quarter, the longest period of sustained annual growth since before 2009.
- Tight Inventory: While new listings rose slightly, strong sales activity kept the overall supply of available homes relatively stable.
Sales Activity Reaches Three-Year Peak
Buyer activity in Manhattan surged during the third quarter of 2025, pushing the number of closed sales to its highest level for this period in three years. A total of 3,281 transactions were completed between July and September, representing a 5% increase compared to the same quarter in 2024.
This rise in transaction volume translated directly into a significant increase in the total value of property sold. The market's total sales volume reached an impressive $6.56 billion, a 10% jump from the previous year. This figure underscores both the high number of sales and the increasing prices of properties being sold.
Understanding Market Resilience
The market's strong performance is notable given the backdrop of external pressures. Factors such as ongoing shifts in the labor market and a contentious local mayoral race did not appear to dampen buyer enthusiasm. This resilience suggests that fundamental demand for Manhattan property remains solid.
Sustained Growth in Contract Signings
The forward-looking indicator of contract activity also painted an optimistic picture. Nearly 2,600 contracts were signed during the quarter, continuing a positive trend. This marked the sixth consecutive quarter of year-over-year growth in signed contracts.
According to market analysts, this is the longest streak of consistent annual growth in contract activity recorded since before 2009. Such sustained momentum indicates that the market is likely to remain active heading into the final months of the year.
"Once again, Manhattan has proven its resilience, showing remarkable strength this quarter. The fundamentals of this market remain solid, fueled by strong demand and a very active luxury segment."
Prices Climb to New Highs Across the Board
For the third straight quarter, all major pricing metrics in Manhattan showed year-over-year increases. This consistent appreciation, not seen since 2022, highlights the competitive nature of the current market.
The median sales price rose by 7% annually to hit $1.225 million. This figure is not only a significant increase but also represents a new record high for the market in the post-pandemic era. It suggests that half of all homes sold in the borough cost more than this benchmark.
Price Per Square Foot Nears Record Levels
The average price per square foot, a key measure of value, increased by 5% year-over-year to $1,792. This figure is now in line with the 10-year average for Manhattan, signaling a return to pre-pandemic valuation levels in many segments.
What's Driving Price Appreciation?
Several factors contributed to the upward pressure on prices during the third quarter. Analysts point to a combination of market dynamics that created a favorable environment for sellers.
- Active Luxury Market: High-end property sales, which command higher prices, were a significant driver of the overall average.
- Condominium Sales Share: A growing proportion of sales were for condominiums, which typically have a higher price per square foot than co-ops.
- Limited Inventory: A persistent shortage of available homes in prime, desirable locations has intensified competition among buyers.
Inventory Remains Tight Amidst High Demand
Despite a slight increase in new properties coming to market, the overall supply of homes for sale in Manhattan remained constrained. At the end of the quarter, there were 6,536 active listings, a minimal 1% increase from the same time last year.
More telling is the 11% decrease in inventory from the previous quarter, indicating that buyers were absorbing properties faster than they were being listed. New listings did rise for the second quarter in a row, up 5% annually, but this was not enough to significantly expand the available choices for buyers.
The high volume of transactions has effectively kept the overall supply in check, contributing to the competitive conditions and rising prices seen across the borough.
Faster Sales Times
Properties in Manhattan are selling more quickly. The average days on market fell to 103 days, a full week faster than a year ago. This is the second-lowest average time on market for a third quarter since 2018, reflecting the urgency among active buyers.
Market Outlook for 2025 and Beyond
The robust performance in the third quarter has set a positive tone for the remainder of 2025 and the start of 2026. The market has demonstrated an ability to navigate economic headwinds and political distractions, suggesting that its core drivers remain intact.
While the upcoming mayoral election and other political events could introduce new variables, the fundamental balance of strong demand and limited supply is expected to continue supporting the market. Experts remain optimistic about Manhattan's long-term appeal to both domestic and international buyers.
The data from this quarter reaffirms the borough's status as a resilient and highly sought-after real estate market, capable of sustaining momentum even in uncertain times. The luxury segment, in particular, will be a key area to watch as it continues to influence overall market health.
