MANHATTAN MAGIC
When people ask me about the current state of Manhattan real estate, this is what I tell them.
John Jacob Astor dominated the fur trade in this country from 1811 to 1834, but it was his huge investment in New York real estate that made him the richest man in America and its first recorded millionaire. It is reported that on his deathbed, Astor lamented the fact that he had not bought all of Manhattan. A form of that lament may be heard nightly at soirees around town. Buying Manhattan started with Peter Minuet in the 17th century and it has not let up since. Along the way it has made millionaires of many and it is that trend which continues today (Mr. Astor meet Mr. Trump).
Although the media generated bubble-babble continues, figures released in March show how resilient the Manhattan market continues to be. Even as price declines are recorded in the rest of the country, Manhattan continues to dazzle. Experts see several reasons for the phenomenon, but primary among them is the fact that Manhattan is a place where people with money - from all over the world - desire to live. Also, as opposed to the rest of the nation, where in large part investor speculation drove the market, Manhattan gets its vigor from first-time buyers and primary-residence home ownership. In addition, it is safe to say that most sellers are also buyers who are trading up, usually to something bigger, often in an emerging neighborhood such as the Lower East Side or Harlem. Of course, this does not mean that investors are blind to the value of owning something in Manhattan that is sure to appreciate.
Most analysts in and out of the industry feel that the comparison of today’s real estate market to overvalued tech stocks and their precipitous fall in the late 1980s is akin to comparing apples and – oh, well – bubbles. Figures released by the Real Estate Board of New York for the calendar year 2005 show the average sales price,the median price and the price per square foot were solidly up for both coops and condos from the previous year.
Despite a slowing of the market at the close of 2005 the median sales price of Manhattan condominiums was up 22 percent to $975,000; the median sales price of cooperative apartments rose as well to $625,000, up 24 percent. Downtown (south of 42nd Street) experienced a 27 percent condo median sales price increase from the previous year, up to $849,000. For the same period, condos in Northern Manhattan (above 96th Street) posted a whooping 46 percent increase for a median sales price of $364,609.
On the Upper West Side the median price of a coop was up 19 percent to $722,000, representing the largest percentage increase of any Manhattan neighborhood. Even more exciting for sellers, for the first time in that area the average coop sales price passed the million-dollar mark.
Although buyers appeared to be more cautious at year’s end due to higher interest rates and the fear of bubbles, in the first three months of 2006 the picture once again looks quite rosy, especially for sales of larger apartments. The average sales price for that period was reported to be $1.3 million, 7 percent higher than in the same quarter last year. Although not as impressive as the 20 plus percent spikes sellers had become used to, it is an increase being fueled by affluent buyers purchasing apartments with two or more bedrooms. If you look at the current market from the buyer’s point of view, the news is also good. Though prices have continued to hold or rise, there are some changes from last year that make this a more level playing field. The market has slowed primarily because there are many more apartments on the market -- pre war, post war and significantly, new developments. The increased inventory means that buyers are in a better position to negotiate, with less of a likelihood that a bidding war will necessarily ensue. There is more to look at and less of a need to rush into what is likely to be the most expensive purchase of a lifetime. If there is any one thing that someone looking at this market can agree on, it is that Manhattan is the capital of the world, and the reality of being a home-owning citizen of that particular world continues to lure anyone with a dream.
-- Rick Wohlfarth
When people ask me about the current state of Manhattan real estate, this is what I tell them.
John Jacob Astor dominated the fur trade in this country from 1811 to 1834, but it was his huge investment in New York real estate that made him the richest man in America and its first recorded millionaire. It is reported that on his deathbed, Astor lamented the fact that he had not bought all of Manhattan. A form of that lament may be heard nightly at soirees around town. Buying Manhattan started with Peter Minuet in the 17th century and it has not let up since. Along the way it has made millionaires of many and it is that trend which continues today (Mr. Astor meet Mr. Trump).
Although the media generated bubble-babble continues, figures released in March show how resilient the Manhattan market continues to be. Even as price declines are recorded in the rest of the country, Manhattan continues to dazzle. Experts see several reasons for the phenomenon, but primary among them is the fact that Manhattan is a place where people with money - from all over the world - desire to live. Also, as opposed to the rest of the nation, where in large part investor speculation drove the market, Manhattan gets its vigor from first-time buyers and primary-residence home ownership. In addition, it is safe to say that most sellers are also buyers who are trading up, usually to something bigger, often in an emerging neighborhood such as the Lower East Side or Harlem. Of course, this does not mean that investors are blind to the value of owning something in Manhattan that is sure to appreciate.
Most analysts in and out of the industry feel that the comparison of today’s real estate market to overvalued tech stocks and their precipitous fall in the late 1980s is akin to comparing apples and – oh, well – bubbles. Figures released by the Real Estate Board of New York for the calendar year 2005 show the average sales price,the median price and the price per square foot were solidly up for both coops and condos from the previous year.
Despite a slowing of the market at the close of 2005 the median sales price of Manhattan condominiums was up 22 percent to $975,000; the median sales price of cooperative apartments rose as well to $625,000, up 24 percent. Downtown (south of 42nd Street) experienced a 27 percent condo median sales price increase from the previous year, up to $849,000. For the same period, condos in Northern Manhattan (above 96th Street) posted a whooping 46 percent increase for a median sales price of $364,609.
On the Upper West Side the median price of a coop was up 19 percent to $722,000, representing the largest percentage increase of any Manhattan neighborhood. Even more exciting for sellers, for the first time in that area the average coop sales price passed the million-dollar mark.
Although buyers appeared to be more cautious at year’s end due to higher interest rates and the fear of bubbles, in the first three months of 2006 the picture once again looks quite rosy, especially for sales of larger apartments. The average sales price for that period was reported to be $1.3 million, 7 percent higher than in the same quarter last year. Although not as impressive as the 20 plus percent spikes sellers had become used to, it is an increase being fueled by affluent buyers purchasing apartments with two or more bedrooms. If you look at the current market from the buyer’s point of view, the news is also good. Though prices have continued to hold or rise, there are some changes from last year that make this a more level playing field. The market has slowed primarily because there are many more apartments on the market -- pre war, post war and significantly, new developments. The increased inventory means that buyers are in a better position to negotiate, with less of a likelihood that a bidding war will necessarily ensue. There is more to look at and less of a need to rush into what is likely to be the most expensive purchase of a lifetime. If there is any one thing that someone looking at this market can agree on, it is that Manhattan is the capital of the world, and the reality of being a home-owning citizen of that particular world continues to lure anyone with a dream.
-- Rick Wohlfarth
1 Comments:
Hi, very nice. The New York City Real Estate is a pretty good idea.
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Have a very good day.
Raphael-Justin "Bob"
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