Gregory J. Heym
Executive Vice President, Chief Economist
Even though the rest of the country may feel the squeeze of the housing slowdown, it hasn't fazed the Big Apple.
By Keisha Lamothe
NEW YORK -- Despite a housing slump across the rest of the nation, home sellers in New York City are selling houses faster with the number of listings reaching a two-year low, according to data released Tuesday.
Prudential Douglas Elliman reported that inventory in Manhattan fell 31.7 percent to 5,204 units in the third-quarter from a year-ago total of 7,623 units, while units stayed on the market for 123 days, faster than the 150 days seen in the same period last year.
The broker reported that the number of sales increased 65.6 percent this quarter to 3,499 units as compared to the 2,113 units sold a year ago. In similar quarterly reports from Brown Harris Stevens, Halstead Property and the Corcoran Group, all three brokers also reported shrinking inventory.
Market-wide, a Manhattan apartment sold for between a median price of $815,000 and $895,000 during the three months ended September 30. The low estimate was reported by Halstead and Brown Harris Stevens, while Prudential Douglas Elliman pegged it at $864,000. Corcoran recorded the high figure among the group.
Housing: Big-ticket vs. Big value
"There are always concerns that a lot of people [looking for real estate] will continue to be priced out, but the median price is only [$815,000] which means that more than half of the sales are below that," said Greg Heym, chief economist at Brown and Halstead.
Corcoran Group reported that the average (mean) price of an apartment in Manhattan jumped to $1.41 million, up 14 percent from the same quarter last year. Prudential Douglas Elliman reported $1.37 million. Brown Harris Stevens and Halstead reported $1.32 million.
"New Yorkers are clearly confident that their homes will retain their value," said Pam Liebman, chief executive of Corcoran. "It was the only market to see price increase and inventory decrease."
Corcoran recorded the highest average condo price of $1.65 million, a jump of 18 percent from a year ago. The median price of a condo hit $1.15 million, up 15 percent from a year ago.
"The economy is very strong, and rental prices are high, which makes it a much wiser decision to buy versus rent," said Liebman.
Caught in a toxic mortgage
Miller said that Manhattan's real estate market has been helped by the financial services industry, which has had four consecutive years of Wall Street bonus increases with the last 2 years at record levels. He also said a falling dollar brought a lot of foreign development to New York.
Corcoran also reported the highest cooperative prices in Manhattan at an average of $1.16 million, up 10 percent from a year ago. Median coop prices rose 7 percent to $695,000.
"A lot of people have been disappointed [in the rising prices], but we're going to need something significant to happen before prices start to decline." said Heym.
Even though home buyers nationwide have struggled with a housing slump, the Manhattan market is unique, according to Liebman. The city's real estate market doesn't share the rest of the nation's problems, because the rules for getting an apartment already weed out a number of unqualified buyers. "Co-ops are stricter than banks," she said.
For potential buyers hoping prices will fall in the near future, New York's continued economic strength is unlikely to provide any relief. "You will only have a downturn when a large number of people need to sell," said Heym.
Tuesday, October 02, 2007