Is New York City different from the rest of the U.S? You bet it is.
For months we’ve been reading about the decline of the housing market nationwide and for just as long I’ve been saying that the Manhattan market is running counter to that. It still is and I believe it will continue to do so.
Many people have become nervous because of all the negative news reports and headlines without looking at the facts. In essence, perception has become realty and it is not an accurate reflection of what is happening. Prudential Douglas Elliman’s just released third quarter Manhattan Market Overview shows how strong the market is.
Let’s look at some facts:
- The Market Overview reported sales increased 65.6% over the 2006 quarter, inventory fell 31.7% with the average price for a co-op up 2.8% to $1.118 million and for a condo up 9.2% to $1.638 million.
- Furthermore, apartments were on the market an average of 123 days, down from150 a year ago.
- The commercial office market is vibrant and that means jobs and that companies have confidence in the future of the New York economy.
- Per square foot prices — the best indicator of trends — are up over last year
- The stock market and financial community, which is really the engine that drives the city’s economy, is still strong and the market is showing confidence in the overall economy, regardless of weakness in the mortgage market.
- The weak dollar has made Manhattan apartments even more attractive to foreigners, who have been feverish buyers in the past several years.
- Stricter lending guidelines and fewer sub prime mortgages have insulated most Manhattan apartment owners from the current mortgage situation.
- With the Federal Reserve lowering its interest rate, mortgages rates will remain fairly stable.
- Just recently, it was reported that prices nationally for existing housing in the country were down about 4% and for the New York area a bit over 3%.
Overall, it’s bullish and this is a good time for those who want to buy. After a leveling off, prices are rising again. While time on the market dropped, it buyers still have more time to negotiate and less pressure to act immediately than a few years ago. Sellers can still get excellent prices for their apartments. Those who want to move either to upgrade or for expanding families should look at this as a quality of life issue and not strictly as an investment. Over the long-term, the investment you make today will increase in value. Don’t ask me, just look at historical data.
The top of the market showed considerable strength, especially three and four-bedroom apartments, and while Wall Street bonuses will most likely be lower this year, they still will give housing a boost.
Even more significant is the square foot price of properties where I have been involved in sales. In a Park Avenue South building prices rose in one year from $1,226 per square foot to $1,600; in Murray Hill from $1,140 to $1,450; on the Lower East Side, from $900 to $1,250-$1,300; and in SOHO from $1,400-$1,700 to $1,850-$2,150.
Overall, the recent activity in the midst of the negative news nationally shows the strength and stability of New York. It’s a good time to take advantage of this.