Manhattan Market Slows, But Prices & Inventory Push Higher(Market Report)
The Manhattan market is moving at a calmer pace than it did throughout all of 2013 (when the borough saw the second highest sales total in 25 years), but that doesn't mean the market is any less robust. Market reports for the second quarter of 2014 show that prices, inventory, and sales volume are all up compared to the same period last year. Inventory hit rock bottom at the end of 2013, so it was bound to rise—it's up 18 percent—but it's still unusually low, making for a highly competitive market. Jonathan Miller, appraiser and Elliman Report preparer, found that 46 percent of all listings sold at or above their asking price, the highest amount in six years. As such, the median price rose more than 5 percent to $910,000, while the average price jumped nearly 18 percent to $1,680,185.
New developments also influenced higher prices, as they set a record price of $1,900 per square foot, thanks to closings at super luxury buildings like One57. The median sale price for the luxury market, the top 10 percent of all condo and co-op sales, jumped 18.4 percent to $4,973,306. The Brown Harris Stevens report notes that there were 45 closings over $10 million, a whopping 181 percent hike from the same period last year.
Thanks to rising condo prices, the co-op market saw a strong quarter as well, as buyers seek more affordability. Median co-op price is $725,000, up 9 percent year-over-year, while the average price is up more than 33 percent to $1,454,193.
The Elliman report shows that condo and co-op inventory is up 18 percent, and Miller credits this to the jump in prices. "Rising prices tend to bring more inventory into the market as sellers are empowered by higher prices," says Miller, "and they have more equity to qualify for the next purchase."
Compared to 2013, sales looks slow, but they did rise more than 6 percent. "Last year was all about the piling on of pent-up demand after the fiscal cliff expired and the sky didn't fall," explains Miller. Additionally, because of "the threat of rising rates, all the fence sitters dove in to the market." He points out that the number of sales, 3,342, is actually the second highest total since the third quarter of 2007. "Volumes are heavy, they just aren't rising as fast anymore."
What's in store for the rest of the year? Miller says we should "look for sales activity to throttle back a bit if [mortgage] rates rise a little bit," but activity will still be "fairly high." "Basically, the market remains robust, but not to the level of last year's frenetic pace."
Tuesday, July 1, 2014, by Jessica Dailey
