Gregory J. Heym
Executive Vice President, Chief Economist
APT. PRICES SOAR EVEN WITH REST OF US NOT READY FOR SUBPRIME
Don't let a slumping stock market shaken by a steep downturn in the national housing market fool you - Manhattan real estate is still red-hot.
The average sales price of apartments in the heart of New York shot up as high as 34 perCent - to $1.43 million - in the last quarter of 2007 compared to the year before, according to reports put out by the city's top real-estate brokerage firms.
While more conservative estimates put the overall sales figure up just under 18 percent, all the major firms agreed that prices continued to go up in the fourth quarter of last year when compared to the same period in 2006.
"Despite the continuing decline in the national housing market, the Manhattan residential market completed the year on a high note, with both average sales price and the median sales price hitting new records," read the quarterly report prepared for Halstead Property.
Experts said New York continues to attract deep-pocketed foreign buyers and Wall Streeters whose purchases of extremely high-end apartments have tended to skew the figures somewhat.
"If there's any segment of the market that's good across the country, it's the luxury market," said Dottie Herman, the CEO of Prudential Douglas Elliman. "I think the city is going to continue to see foreign investors, and I believe those numbers are going to grow."
For example, large numbers of high-priced condo apartment sales in both The Plaza hotel and at 15 Central Park West blurred the market somewhat.
Sales in those buildings - where some apartments netted up to $60 million - made up 7 percent of the total sales in the last quarter.
Those sales made the average condominium sales price skyrocket by 51 percent, according to one set of figures. But when the two buildings were factored out, average condo prices only jumped about 13 percent, one analyst said.
With the buildings factored in, the average price for condos was as high as $1.85 million, according to Halstead's numbers.
"If you take those condo sales out of the mix, that number goes down almost a half-million dollars," said Gregory Heym, chief economist for Brown Harris Stevens and Halstead Property. "It would still give you a higher average price from a year ago. It just wouldn't be 51 percent."
The report showed that the average sales price of all 2,581 apartments sold in Manhattan from October through December was $1.43 million - an increase of 34 percent from an average price of $1,071,128 in the fourth quarter of 2006.
The other reports - done by the Corcoran Group, Prudential Douglas Elliman and Brown Harris Stevens - showed roughly the same findings in average price, although they differed in estimating the increase from last year.
As for median price, Halstead showed a 14 percent increase to $828,000, Corcoran a 15 percent bump to $915,000 and Elliman a 6.4 percent boost to $850,000.
Price per square foot also went up 10 percent from $1,034 in 2006 to $1,138 now, according to Corcoran's report.
Overall, the figures run counter to those seen nationally, where foreclosures stemming from the subprime loan crisis have sent the real estate market into a deep downward spiral.
"New York City is in a class by itself," said Pamela Liebman, the CEO of the Corcoran Group.
But in one interesting measure of the health of the market, the average time that homes remained up for sale increased 13 percent to 84 days, according to Halstead's report.
There were other surprising findings.
While the median sales price for apartments along Park Avenue between 59th and 96th streets shot up 100 percent, figures for the same stretch on nearby Fifth Avenue actually declined by close to $1 million.
In Harlem, the median price shot up 53 percent, to $610,000. And along Columbus Avenue between 87th and 110th streets, the median price jumped 57 percent to $1.195 million.
But areas like Inwood saw some slippage, with median prices dipping to $299,000 from $312,500.
Thursday, January 03, 2008