The new quarterly housing market numbers are out today, and Manhattan defies the rest of the country with soaring prices and shrinking days on the market.
Is it just a supply issue? Partly. Is it a wealth-effect issue? Sure, that too. What about foreigners and the power of their money against the dollar? You betcha. Will it last forever? Nope.
“There is more downside risk than we've had in a while, with so many unanswered questions about the economy,” says Halstead Property’s chief economist, Greg Heym. “We've kind of come to grips with the fact that Wall Street bonuses are going to be okay this year, but now it's sort of shifted to where people are worried about their jobs. It's one thing if people are worried about their bonus, they're going to be apprehensive, if they're worried about their job, it becomes a little more serious.”
The average price of an apartment in Manhattan is up 34 percent from a year ago with average condo prices up a whopping 51 percent, but you can blame the bulk of that on two new high-end properties: The Plaza and 15 Central Park West. If you strip those two out of the numbers, average prices on all homes are up 13 percent and condos up 14 percent.
Remember, I’m talking averages, not medians. The median price of a home in Manhattan is $828,000, although that’s still up 14 percent from last year. Median means half above, half below.
With the average price so much higher than the median, we know that Manhattan is seeing far more activity on the high end. That’s probably all those foreigners flaunting their far-more-valuable currencies.
An article in the New York Sun today claims Manhattan apartments will lose 90 percent of their value in gold terms in the next few years, but I don’t even want to go there. Anyway, if anyone’s interested in a lovely, renovated, pre-war, two-bedroom co-op on 96th between 5th and Madison, shoot an email to the Realty Check; I have a friend who’s selling.