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Manhattan For-Sale Market Continues at Record Levels

Though it dipped very slightly between the first and second quarters, condo and co-op pricing remains at record highs.

By Sule Aygoren Carranza | Updated on July 11, 2008

NEW YORK CITY-Manhattan apartment unit sales prices continue to hover near record levels, but it seems that they may be steadying. After reaching a peak in the first quarter, the average price of a local apartment dropped 2% to $1.66 million in the second quarter. Still, that figure is up 36% over the second quarter of last year, notes Brown Harris Stevens.

In compiling the study, BHS obtained transaction data from ValuExchange, a proprietary database of the Manhattan residential market. The data from this report came from 2,988 recorded apartment sales in the borough, an 18% decrease from sales reported during the same period in 2007. The findings, says James M. Gricar, executive vice president and director of sales at the locally based firm, is a continuation of trends of the past several quarters.

“When you’re talking about real estate, you really cannot get too far from supply and demand. At the end of the day, it’s an inventory-based business. One of the things that have made Manhattan so different from the vast majority of markets in the US, is a consistent shortage of inventory in the past 10 years,” he says. “Tight inventory is pushing prices a little upward, particularly in categories where there’s very little inventory, such as three-bedroom units or larger. However, the zeitgeist of the market is the fear that we’re heading into a potentially very difficult economic period, and that’s reduced the number of transactions. So we’re seeing a reduction in the number of transactions and simultaneously, the average and median prices increasing slightly.”

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