Gregory J. Heym
Executive Vice President, Chief Economist
MANHATTAN APT. PRICES PLUNGING
By BRADEN KEIL
October 4, 2006 -- The top-heavy Manhattan residential real-estate market is teetering toward a long downward slide, new sales data show.
Third-quarter market reports released today by the city's top four real-estate companies show that apartment prices have dropped, while two of the surveys say prices have sunk below last year's third-quarter numbers.
Following a record run of year-over-year double-digit price increases, the second half of 2006 appears to be a turning point moving in sympathy with the negative national housing market.
"My phone has nearly stopped ringing," said one high-end broker who requested anonymity. "It's a scary time in this business."
A chilling report by Brown Harris Stevens shows the average sale price for cooperative apartments slid by 4 percent in the past 12 months to $1,003,945, while condos fell 6 percent to $1,196,930, compared to the third quarter of 2005.
Halstead Property notes that the average apartment price is $1,087,982, which is 4 percent less than a year ago, and 10 percent lower than the second quarter 2006.
Weighing particularly hard on the market is the average sales price for a Manhattan co-op, which has dropped 16.1 percent in just the last quarter, from $1.296 million to $1.088 million, according to figures by Prudential Douglas Elliman.
Also, number of days on the market has jumped from 133 days in the third quarter of '05 to 150 days, says Elliman figures.
According to Halstead, the average price for West Side apartments was lower this quarter than the third quarter of last year in every size category, from studios to four-bedroom luxury flats. And new listings fell 10 percent downtown and 8 percent on the East Side in the past 12 months.
The negative numbers represent a stalemate between buyers and sellers, an overabundance of properties for sale and a boom in the construction of condominium developments.
And for the first time in history, city condo sales outnumbered co-op sales, which should continue, brokers say, given the deluge of condominiums coming to market.
The Corcoran Group reports a 17 percent drop in deals closed in the past 12 months from 3,597 to 2,996.
Corcoran CEO Pamela Liebman says there are fewer deals being struck because sellers are still sticking to their asking prices while more buyers are taking a wait-and-see attitude.
"Buyers don't feel the same urgency as in the past," she said. "They feel more empowered to make low offers or just wait. We're not going to sell as much as we did in the last few years because the market was previously reacting to a lack of inventory."
Across the country, home prices fell 1.7 percent from August of last year, according to figures released by the National Association of Realtors - the first time in 11 years the market had a year-over-year decline.
"Higher-priced markets are seeing larger declines," Lawrence Yun, an economist with the National Association of Realtors, told The Post. "People just cannot afford them because they've risen so much in places like New York.
Wednesday, October 04, 2006