Gregory J. Heym
Executive Vice President, Chief Economist
Tight Supply of Apartments Keeps Prices High as Number of Million Dollar Homes Skyrocket
Is the housing bubble about to burst? The government is reporting a sharp decline in new home sales in August to a seasonably adjusted rate of more than 1.2 million units. The 9.9 percent drop is more dramatic than expected, coming after three straight monthly increases.
The new home sales report stands in sharp contrast to yesterday's reading on sales of previously-owned homes. The National Association of Realtors told of a two percent increase last month to the second-highest level on record.
"The economic indicators we see in the city are very positive," said Gregory Heym, chief economist for Terra Holdings, an owner of real estate brokerages.
"The other thing that could cause a downturn would be an oversupply of apartments, and that is something we just do not have, particularly in Manhattan," he told WCBS 880's Ginny Kosola.
Heym also touched on other factors affecting the local real-estate market, including the relatively small number of properties being financed by interest-only loans and the possibility of further increases. financed by interest-only loans and the possibility of further increases.
Tuesday, September 27, 2005