Manhattan Market Review, 2010

The end of January is here so let's look in the rear view for a review of how the real estate market performed last year.

The proof is in the hard data that the Manhattan real estate market is stabilizing. Although there has been a 5.6% increase in inventory compared to 2009, 4th Quarter, sales still remain constant. There were 2,295 recorded sales in the 4th Quarter 2010. The median sales price of a Manhattan apartment, condo and co-op, has increased to $845,000 from $810,000 in 2009 Q4, but this is an actual decrease from 2010 Q3 which had a median sales price of $910,000. Days on market decreased from 204 to 125 days. This may be attributed to sellers adjusting selling prices to move product instead of trying to get a high price from a fictitious buyer. Listing versus selling price was calculated at 8%.

The good news is that prices have stabilized.  The “spin” is that the market is continuing to build strength and momentum. The higher end of the market with purchases of $15 million up, is especially strong and is inflating the average price figures. There remains a degree of uncertainty in the more mainstream segments of the market as reflected by the number of sales which is down from last year. This is a sharp contrast from Spring 2010 when smaller units were much more in demand and sales volume was on the rise. Entry level buyers took advantage of the market conditions and the home buyer credit.

Data from STREETeasy reports that 5,582 condominiums and 6,655 cooperative apartments sold in Manhattan in 2010. So far, month to date, 70 condominiums and 119 cooperative apartments have sold.

Although real estate here in New York City is holding firm and some tremendous opportunities exist, we are not out of the woods. The rest of the country continues to experience a struggle in regards to the housing market. According to the Standard and Poor's Case-Shiller Home Price Index, 20 major metropolitan areas saw a 1% slide in price. Chicago, Las Vegas, Detroit, Atlanta, Seattle, Charlotte, Miami, Tampa and Portland, Ore top the list.

The winter and overall seasonal variances will impact the market performance. An interesting fact is that it can take up to four months to close property in New York City from initial acceptance of  the offer to reaching the closing table. The discrepancy of when a property actually sells versus closing would be a very interesting study. In fact, The National Association of Realtors released yesterday a report that the Pending Home Sales Index, a forward-looking indicator, increased 2.0 percent to 93.7 based on contracts signed in December from a downwardly revised 91.9 in November. The index is 4.2 percent below the 97.8 mark in December 2009. The data reflects contracts and not closings, which normally occur with a lag time of one or two months in other markets.

Send me a message if you'd like me to email you a more detailed analysis of 2010 real estate reporting. This includes a breakdown of how new development and condos vs. co-ops performed last year.

Next month, Closing Table NYC will discuss the new agency disclosure laws that are now in effect for Manhattan.

Happy 2011 Wishes! The Real Estate Market Vibrates

Happy New Year and may you have a prosperous and healthy 2011.

Is that the smell of roasted chestnuts? Think again, with mortgage rates and home prices still low, talk of a rebound in the housing market permeates every street corner and party in New York. This year could potentially be stronger for home sales than 2010. Although we can safely say that the market has not recovered, there has been an increase in sales activity. We have to monitor the early months of 2011 and hope to see a more consistent increase in home purchases.

According to the National Association of  Realtors, executed contracts to purchase homes in the northeast increased 22.1% since June 2010. The signing index, which has been tracking this data since 2001, reports that June had the lowest number of signings since tracking began. Most sales are being attributed to sellers positioning their properties based on market activity. The low mortgage rates also created a blip of activity in November in the wake of a slow October due the homebuyer tax credit ending.

Mortgage rates may have bottomed out. The average rate for a 30 year fixed product increased in December 2010 to the highest point in seven months. Freddie Mac reports that the average rate increased to 4.86% from its historic 40 year low of 4.17% in November 2010. 15 year products increased to 4.2% from 3.57% in November, the lowest since 1991. You may want to contact your mortgage broker to refinance or if making a purchase, lock in the rate.

Mouths of the Manhattan elite fell agape in 2010 when the estate of Brooke Astor accepted a low offer for the sprawling property which consists of the 15th and 16th floors at 778 Park Avenue. Originally listed in 2007 for $46 million, then reduced to $24.9 million, the accepted offer is said to be in the high teens. The estate is encouraging additional offers and hopes to land in the low $20 million range. Now is the time to contact your mortgage broker and make magic happen. As a historic notable, Mrs. Astor's husband, Vincent Astor, was the oldest son of John Jacob Astor who perished in the Titanic disaster of 1912.   

Celebrity drag queen RuPaul sold her 1490 square foot West Village apartment at 296 West 10th Street for $2.4 million in 2010. The "supermodel to the world" purchased the condo in 1998 for $1.095 million.

Have a safe and happy start to the new year. Closing Table NYC will be updated later this month with the final calculation of 2010 sales activity in New York City.

-Michael DuBour
mdubour@elliman.com

Data obtained from The Real Deal, New York Times and Prudential Douglas Elliman Real Estate.