Second Quarter Reports indicated stability in luxury apartment markets in Manhattan
July 03, 2012
The city's inventory of for-sale "luxury" apartments continued to dwindle in the Second Quarter, according to a Corcoran Report issued today. Market-wide, available listings declined 12 percent from a year ago to 8,060 units and 4 percent lower than in the First Quarter, the report said, adding that "with limited new development properties available, condominium inventory is eroding at a steeper rate than co-op inventory compared with a year ago": "condo inventory declined 14 percent while co-op inventory declined 9 percent."
There is "elevated pricing and a sense of urgency in the market," the report continued, as a result of "strong demand, limited inventory, low interest rates and unwavering enthusiasm for Manhattan as a global capital."
"There were 3,650 market wide closed sales during the Second Quarter," it said, "3 percent higher than the Second Quarter 2011 and 30 percent higher than First Quarter 2012," and the sales activity is the highest number since the Second Quarter of 2008.
The average sales price for all apartments market-wide was $1,397,000 in the Second Quarter of this year was unchanged from the first quarter but 2 percent higher than the Second Quarter of 2011, the report found. The market-wide resales average sale price of $1,343,000 was two percent higher than the first quarter and unchanged from the previous year's quarter, it continued.
According to the Second Quarter Douglas Elliman Report, "housing prices remained stable as shift in mix to entry-level sales continued" and record low mortgage rates and rising rents as a result of tight credit and rising employment "fueled first-time buyer demand."
It found 13.5 percent fewer listings in the second quarter than in the prior year quarter, noting that "this brought the absorption rate down to 7.9 months, the second fastest pace since 2007."
"Economic uncertainty abroad and the weak U.S. dollar brought more foreign buyers looking for an investment safe haven, resulting in higher frequency of high-end 'trophy' transactions," the Elliman report maintained.
"New development listings dropped 20 percent and resales declined 11.8 percent over same period," it continued.
The Elliman chart at the right indicates that the number of sales has been pretty stable since 2009 and the average sales price has been climbing in recent months.
The Second Quarter 2012 Brown Harris Stevens Report prepared by Gregory Heym, the chief economist for Brown Harris Stevens and Halstead Property, found that pre-war cooperative apartments rose on the East Side to $386,891 per room in the Second Quarter 2012 as compared to $361,912 in the Second Quarter 2011 while post-war cooperative apartments fell to $216, 218 from $232,746 in the previous year's quarter.
On the West Side, pre-war condominium apartments declined to $251,158 per room in the Second Quarter 2012 from $276,066 in the same quarter in 2011 while post-war condominium apartments fell to $207,811 in the second quarter from $211,679 the previous year, the report continued.
The average price per square foot of cooperative apartments on the East Side rose slightly in the Second Quarter of this year to $1,225 from $1,200 the previous year's quarter, the Brown Harris Stevens report said, adding that the average price per square foot of condominium apartments increased to $1,505 in the Second Quarter of this year from $1,322 the previous year's quarter.