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Manhattan apartment sales fell by nearly 30% in the fourth quarter.
Brokers are concerned both buyers and sellers are staying on the sidelines.

Craig Warga | Bloomberg | Getty Images

Manhattan apartment sales fell by 29% in the fourth quarter, sparking fears of a frozen market in which buyers and sellers stay on the sidelines due to economic and rate fears.
There were 2,546 sales in the quarter, down from 3,560 last year, according to a report from Douglas Elliman and Miller Samuel. The decline was the largest since the third quarter of 2020, during the depths of the pandemic.

Prices also declined for the first time since early 2020, with the median price down 5.5%.
The declines in both sales and prices mark the end of the roaring comeback in Manhattan real estate after the worst days of the pandemic and raise fears of continuing weakness into the new year. Rising interest rates, a weaker economy and a falling stock market, which has an outsized impact on Manhattan real estate, are all likely to weigh on the market this year.
Analysts say their big worry is a prolonged standoff between buyers and sellers — with sellers unwilling to list amidst falling prices and buyers pausing their searches until prices fall further.
“I could see the market moving sideways, with some modest declines in some sectors,” said Jonathan Miller, CEO of Miller Samuel, the appraisal and market research firm. “And it could weaken further if there is the backdrop of recession and job loss.”
Even as prices and sales drop, however, inventory remains tight as sellers hold off on listings. There were 6,523 apartments on the market at the end of the fourth quarter, according to the report, up only 5% from last year but still well below the historical average of around 8,000. Without a large increase in inventory, analysts say prices are unlikely to fall enough to lure back many buyers waiting for discounts. The average discount from initial list price to sales price was 6.5%, up from 4.1% in the third quarter, according to Serhant.

Rising interest rates have also moved more Manhattan buyers into all-cash deals, which accounted for 55% of all sales in the fourth quarter, the highest on record, according to Miller.
As with much of the recovery, the high-end and luxury segment remains the strongest. Median sale prices for luxury apartments — defined as the top 10% of the market — increased 4% in the fourth quarter, compared to a decline in the broader Manhattan market. Median prices for luxury apartments are up 21% compared to 2019, twice the increase as the broader market.

The outlook for 2023

The pipeline of deals in the works or recently signed suggests a slow first quarter. There were only 2,312 contracts signed in the fourth quarter, down 43% over last year, according to Brown Harris Stevens. The quarter was the worst for new contracts signed in the past decade, according to a report from Serhant.
“Contracts signed are a timelier indicator of demand and registered one of the slowest finishes to any year since 2008,” according to Brown Harris Stevens.
Brokers, however, say they remain optimistic and many are predicting an upside surprise in 2023, as rates stabilize and buyers find opportunities in a softer market. John Gomes, co-founder of the Eklund Gomes team at Douglas Elliman, said December was “on fire” with a frenzy of year-end deals.
“It really caught us off guard,” he said. “Things really turned around in December.”
Gomes said one buyer paid $20 million for a townhouse in Greenwich Village that wasn’t even on the market. He said a real estate investor made offers for four separate apartments in new developments “that look like they will be accepted today.”
Ian Slater at Compass said there was a big “disjoint” in the market in August and September, with a wide divide between buyers and sellers and the market started to weaken. “Now I am seeing buyers accept interest rates as the new normal and feel more comfortable purchasing — or at a minimum that prices aren’t falling.”
Gomes said one reason for the December burst of activity is foreign buyers, who started to return to the city in December. With the dollar weakening slightly and travel restrictions lifting around the world, brokers say buyers from the Middle East and China returned in December.
Brokers say buyers are also using cash to avoid the higher interest rates and taking advantage of lower prices. And developers with new apartment buildings on the market are lowering prices to unload unsold apartments.
“Developers are being realistic, they’re making concessions on price and closing costs,” he said. “I feel optimistic about the coming year.”

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Southwest executives have vowed to reimburse travelers for expenses tied to the mass cancellations.
Bank of America estimates the debacle will cost Southwest between $600 million and $700 million.
Southwest executives also said they would work to improve their internal technology.

Pristine Floyde searches for a friend’s suitcase in a baggage holding area for Southwest Airlines at Denver International Airport on December 28, 2022 in Denver, Colorado.
Michael Ciaglo | Getty Images

Southwest Airlines stabilized its schedule over the weekend after about 16,000 cancellations since late last month, but its systemwide holiday meltdown could cost it hundreds of millions of dollars.
Southwest had canceled 304 flights since Friday, 2% of its schedule, most of them on Monday when U.S. airlines faced bad weather and ground stops in Florida tied to a Federal Aviation Administration equipment outage. For comparison, from Dec. 21 through Dec. 29 Southwest had scrubbed about 45% of its operation, a far bigger share than other major airlines, according to FlightAware.

Now come two more difficult tasks for Southwest: going through thousands of passenger reimbursement receipts and improving the internal technology that contributed to the meltdown.

“We have plans to invest in tools and technology and processes, but there will be immediate work to understand what lessons are learned here and how we keep this from ever happening again, because it cannot happen again,” Southwest CEO Bob Jordan, who took the helm in February, told staff Friday.
Jordan said employees from other departments have volunteered to help customers and process refunds. The carrier is working with FedEx to help get customers their luggage.
“We’ve cut the number of bags in half since Thursday and we’re on track to get the majority if not all bags shipped to our Customers later this week,” Jordan told staff on Monday.
On Tuesday, Southwest began offering travelers whose flights were canceled or significantly delayed between Dec. 24 and Jan. 2, and who didn’t travel or rebook, 25,000 Rapid Rewards points, a roughly $300 value, according to the airline.

The miles required to redeem for a ticket vary depending on demand and capacity. Over Easter weekend, for example, it currently costs more than 25,000 Rapid Rewards points to travel roundtrip between Baltimore and Los Angeles, but it would more than cover a ticket a week later.
Bad weather kicked off the issues last month, impacting flights throughout the U.S. But Southwest crews struggled to get reassigned automatically after all of the changes and were forced to wait on hold for hours with crew scheduling services. Hundreds of thousands of passengers were impacted, and Southwest is still working through a backlog of misplaced luggage.
The carrier had canceled about two-thirds of its flights for much of the last week in an attempt to get crews and planes where they needed to go, before operating close to normally on Friday.
The chaos could cost Southwest between $600 million and $700 million, according to estimates from Bank of America airline stock analyst Andrew Didora on Tuesday. That includes both lost revenue from refunds and the reimbursements to affected passengers, which could include expenses like hotels and rental cars.
Didora cut his fourth-quarter adjusted earnings forecast for Southwest to 37 cents a share from 85 cents.
A Southwest executive last week said the cancellations will “certainly” hit its fourth-quarter results but that it will take weeks to work through customers’ reimbursement requests.
Transportation Secretary Pete Buttigieg vowed to hold Southwest accountable if it didn’t provide customers with refunds and reimbursements, though such fines associated with a failure to pay back customers can take months if not years.
Southwest shares fell 3.2% to $32.60 on Tuesday, a bigger drop than rivals. The Dallas-based airline is scheduled to report results on Jan. 26 but is likely to preview the meltdown’s costs before then.

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It’s that time again! “Mad Money” host Jim Cramer rings the lightning round bell, which means he’s giving his answers to callers’ stock questions at rapid speed.

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Hertz Global Holdings Inc: “I want to buy that stock for my Charitable Trust. I’ve actually been thinking about that. With [CEO Stephen] Scherr in your corner, you can’t miss.”

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CNBC’s Jim Cramer on Tuesday said that certain commodities could make a comeback soon.
Commodities markets were volatile last year as Russia’s invasion of Ukraine, economic issues in the U.S. and China and adverse weather shook investor sentiment and diminished supply.

CNBC’s Jim Cramer on Tuesday said that certain commodities could make a comeback soon.
“The charts, as interpreted by Carley Garner, tell us that the boom and bust cycle in commodities never stops, and right now that’s good news for oil, … natural gas and wheat prices,” he said.

Commodities markets were volatile last year as Russia’s invasion of Ukraine, economic issues in the U.S. and China and adverse weather shook investor sentiment and diminished supply. Prices of oil, natural gas and wheat roared higher in the first half of the year but stabilized somewhat in the later half as the Federal Reserve raised interest rates and pandemic-driven supply snags resolved.
To explain Garner’s analysis, Cramer examined the weekly chart of West Texas Intermediate crude, the U.S. benchmark for oil.

Arrows pointing outwards

He pointed out that Garner was adamant last year that oil would return to its previous trading range once sanctioned Russian oil was rerouted to India and China, and the chart shows that her prediction came true.
Cramer added that she expects oil this year to move between $65 to $70 a barrel on the low end, and to perhaps the mid-$90s and low $100s on the high end.
“She expects this channel to be resilient, and that is why she recommends buying the dips,” he said.

For more analysis, watch Cramer’s full explanation below.

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Shares of Endeavor, the owner of the Ultimate Fighting Championship, fell after a video surfaced of UFC president Dana White hitting his wife.
Endeavor, run by Hollywood super agent Ari Emanuel, took full ownership of UFC in 2021.
White issued a public apology on Monday, according to media reports.

Dana White appears at the UFC 282 post-fight press conference on December 10, 2022, at the T-Mobile Arena in Las Vegas, NV.
Amy Kaplan | Icon Sportswire | Getty Images

Media and entertainment company Endeavor saw its shares fall on Tuesday after a video showing Dana White, the president of its Ultimate Fighting Championship business, slapping his wife.
Endeavor shares closed down nearly 6%.

This week, a video published by TMZ showed White getting into an altercation with his wife, Anne, at a New Year’s Eve party in Cabo San Lucas, Mexico. In the video, it appears the two are arguing before Anne White slaps Dana White. He then slaps her.
Endeavor and the UFC didn’t immediately respond to requests for comment.
White issued a public apology Monday, according to media reports. Anne White also issued a separate statement to TMZ, calling it isolated incident.
White is synonymous with UFC, having served as its president since 2001.

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In 2014, White spoke out about domestic violence after Ray Rice of the NFL assaulted his fiance, saying you “don’t bounce back from putting your hands on a woman,” according to media reports. “Been that way in the UFC since we started here.”

Following the comments, White also revealed the UFC screens people for domestic violence.
Hollywood powerhouse Endeavor began as a talent agency and was co-founded by one of the industry’s most recognizable agents, Ari Emanuel. Endeavor has bulked up over the years through a series of acquisitions, owning and managing live events like the Miami Open and the Miss Universe international beauty pageant.
Endeavor acquired a controlling interest in the UFC, a popular mixed martial arts league, in 2016. It took full ownership of UFC in 2021, the year Endeavor had its initial public offering, according to a securities filing.

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CNBC’s Jim Cramer on Tuesday offered investors a collection of stocks that he believes will perform well this year.
“These companies tend to make things or do stuff at a profit while returning capital to shareholders,” he said.

CNBC’s Jim Cramer on Tuesday offered investors a collection of stocks that he believes will perform well this year.
All of his picks are listed in the Dow Jones Industrial Average.

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“These companies tend to make things or do stuff at a profit while returning capital to shareholders, all with reasonably priced stocks — exactly the rubric for what worked once the [Federal Reserve] declared war on inflation,” Cramer said.
Here is his list:
Chevron

Cramer said he believes the company will have a great year as long as crude prices stay above $60. 

Honeywell

He said he’s bullish on the stock because it has several divisions that could be spun off to make Honeywell more focused on more profitable businesses.

Procter & Gamble

The company is the best of the bunch when it comes to recession-proof stocks, according to Cramer.

Travelers Companies

He said the company is one of his favorite insurance plays.

Johnson & Johnson

The company has one of the best and fastest-growing pharma businesses, according to Cramer.

Disney

He said that he’s bullish on the stock since CEO Bob Iger returned to the helm.

American Express

He said that American Express is a “tremendous bounce-back stock” that also sells at a reasonable price.

Cisco

Cramer said that the company has proved it can perform well going forward, and it’s only a matter of time before Wall Street catches on.

Salesforce

The peaking U.S. dollar will likely help Salesforce’s balance sheet, he said, adding that he also likes the company’s “gigantic cash flow, excellent cash in the till and more than 20% growth.”

Goldman Sachs

Cramer predicted that the company will likely perform better this year than last year, even though IPOs, mergers and acquisitions are unlikely to make a comeback in 2023 as the economic environment remains turbulent.

Disclaimer: Cramer’s Charitable Trust owns shares of Honeywell, Procter & Gamble, Johnson & Johnson, Disney, Cisco and Salesforce.

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The Manhattan U.S. Attorney’s Office created an FTX Task Force to trace and recover assets of victims of the crypto exchange’s collapse.
The announcement came as FTX founder and former CEO Sam Bankman-Fried appeared in U.S. District Court in Manhattan to plead not guilty in his criminal fraud case.
The Securities and Exchange Commission has estimated that customers lost more than $8 billion as a result of fraud at FTX and Bankman-Fried’s hedge fund, Alameda Research.

The Manhattan U.S. Attorney’s Office said Tuesday it had created an FTX Task Force to trace and recover assets of victims of the cryptocurrency exchange firm’s collapse and to handle investigations and prosecutions related to the company and other entities.
The announcement came as FTX founder and former CEO Sam Bankman-Fried appeared in U.S. District Court in Manhattan to plead not guilty in his criminal case, where he is charged with multiple counts of financial fraud and campaign finance crimes.

“The Southern District of New York is working around the clock to respond to the implosion of FTX,” Manhattan U.S. Attorney Damian Williams said in a statement.
“It is an all-hands-on-deck moment,” Williams added.

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“We are launching the SDNY FTX Task Force to ensure that this urgent work continues, powered by all of SDNY’s resources and expertise, until justice is done,” he said.
Williams’ top deputy, Andrea Griswold, is leading the task force, which will draw prosecutors from the Securities and Commodities Fraud, Public Corruption, and Money Laundering and Transnational Criminal Enterprises units.

Former FTX chief executive Sam Bankman-Fried (C) arrives to enter a plea before US District Judge Lewis Kaplan in the Manhattan federal court, New York, January 3, 2023. 
Ed Jones | AFP | Getty Images

The Securities and Exchange Commission has estimated that customers lost more than $8 billion as a result of fraud at FTX and Bankman-Fried’s hedge fund, Alameda Research.

When FTX filed for Chapter 11 bankruptcy protection in November, it claimed to have more than 100,000 creditors, and liabilities of between $10 billion and $50 billion, compared with assets in an identical range.
The 30-year-old Bankman-Fried is free but under house arrest at his parents’ residence, on a $250 million personal recognizance bond, which was set after he was extradited from the Bahamas late last month.
Two of his lieutenants pleaded guilty in Manhattan federal court to multiple counts of fraud before he was extradited: Caroline Ellison, the 28-year-old former CEO of Alameda, and FTX co-founder Gary Wang, 29.
Both Ellison and Wang are cooperating in the investigation of Bankman-Fried and related FTX matters.

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CNBC’s Jim Cramer on Tuesday reminded investors that the new year didn’t bring about a new economy.
Stocks slipped on Tuesday to kick off the year, as rising interest rates and persistent inflation continued to worry investors.

CNBC’s Jim Cramer on Tuesday reminded investors that the new year didn’t bring about a new economy.
“The fundamentals are what matters and, sadly, we have not turned the page on this economy — just the calendar,” he said.

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Stocks slipped on Tuesday to kick off the year, as rising interest rates and persistent inflation continued to worry investors.
Recession-proof stocks such as health care and consumer-packaged goods are working, he said. Stocks of companies that have significant business in China are also performing well since the country is poised to continue reopening its economy, he added.
Cramer warned that while it’s far too soon to bet that mega-cap tech stocks will make a comeback, he still believes that investors who own shares of Apple shouldn’t sell. 
The company could release a “brutal” preannouncement before it reports fiscal first-quarter earnings later this month, he predicted.
“Still, I believe Apple’s issues are related to supply, not demand. It’s gonna be a tough time to own this stock, but Apple’s such a high-quality company … I’m sticking with it with my usual attitude: own it, don’t trade it,” he said.

Disclaimer: Cramer’s Charitable Trust owns shares of Apple.

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