Gregory J. Heym
Executive Vice President, Chief Economist
Manhattan apartment listings spike for condos and townhouses; co-ops less hard hit
By Vanessa Londono
The numbers don't lie. Inventory in Manhattan is up.
Figures recorded by appraisal firm Miller Samuel show 7,348 housing units on the market for April, down only slightly from the 7,439 units for March of this year.
Over a 60 percent increase in Manhattan listings from last year is a pretty accurate portrayal of which way the market is heading.
But listings aren't necessarily rising across the board for all housing types. The number of condos on the market is climbing rapidly, while co-op inventory has remained much more flat in comparison.
The figures show how prominent a role new condo development may play in any further downturns in the Manhattan market, a definite possibility given more interest rate rises or too much high-end housing supply.
At the same time, the fact that co-op supply isn't dramatically increasing at the same rate as condos may comfort some market watchers.
From March to April, while condo inventory increased 5.8 percent, co-op inventory actually fell by 6.9 percent, according to Miller Samuel.
Over the past year, from April to April, Manhattan condo inventory climbed by 70 percent, while co-op inventory grew at around half that pace, rising 37 percent. There were more than 3,100 condos on the market in April and nearly 3,700 co-ops.
"Condos are the preferred form of development," said Jonathan Miller, president and CEO of Miller Samuel. "While the housing stock is three-to-one co-ops over condos, the push of new development is bringing units in a large quantity, and the total available number of condos to co-ops is catching up."
While condos and co-ops make up the bulk of the market, Manhattan's third most prevalent type of for-sale housing -- townhouses -- presents worrying signs when one examines the rise in inventory over the past year.
From April 2005 to April 2006, townhouse inventory spiked nearly 98 percent, from 276 to 546 total listings.
Overall, Miller pointed out that, to some degree, the inventory trend up is normal. In anticipation of the spring market, listings have a seasonal pattern of swelling.
At the end of the second and third quarters, spring fever will have passed and market watchers will be able to see how spring, typically the busiest time of year, played out, Miller said.
"The third quarter is where we'll get a better idea of where the market is going," Miller said.
The increase in supply means prices will likely continue to stay flat or decline, trends borne out by a recent market report from Halstead Property.
"New listings have begun to rise over the last few months," said chief economist for Halstead Property Gregory Heym. "For us, it shows the market isn't where it was a year ago when the increasing demand and shrinking supply made prices jump.
"Now, instead growing at 25 percent, it is more in the range of 5 to 10," he said. "It's a rate of growth that everyone is more comfortable with."
The neighborhood with the most housing units on the market as of April was the Upper East Side, with 1,656 listings, followed by the Upper West Side with 1,400, Tribeca with 640 listings, and Chelsea with 600, according to Miller Samuel (see chart).
Copyright © 2003-2005 The Real Deal
Thursday, June 01, 2006