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Industry Insiders Weigh in on Manhattan Residential Market

NEW YORK CITY-Manhattan Landing, on the East Side, has been zoned for residential development for 25 years and, although it has been dormant since, the time may come to develop the area, according to architect Costas Kondylis.

By Melissa Kress | Updated on September 18, 2003

NEW YORK CITY-One phrase that seems to sum up the Manhattan residential real estate market may be “smaller is better,” according to Adrienne Albert, president of the Marketing Directors Inc.

Speaking at a New York District Council of the Urban Land Institute meeting this morning, Albert told a crowd of approximately 250 that–at this moment–smaller homes are hot. The coupling of low mortgage rates and high rental rates led to more people buying condominiums in the city, a large portion of which were one-bedroom units. Across all neighborhoods, one-bedroom condos sold for $500,000-600,000 or an average of $700 per sf. New two-bedroom condos sold for approximately $1.2 million, or an average—below 96th Street—of $700 to $1,000 per sf. Four-bedroom condos sold for an average of $2.5 million this year; however, they only accounted for 1.5% of the transactions in the market, she explained.

And as we look to the future, Albert said that a number of a new condo sites are planned for 2004 and 2005 but those will only bring 1,400 new units to the market—a proportionately small amount compared to the market size. This low level of inventory will lead to increased prices, she added.

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