Manhattan Homebuyers Pay Up as Sales Top Listing PriceOshrat Carmiel
Manhattan apartment prices rose 4.2 percent in the third quarter, bolstered by buyers who increasingly agreed to pay what sellers were asking or more.
The median sale price of condominiums and co-ops was $908,242, up from $872,000 a year earlier, according to a report today from appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. The average price per square foot increased 12 percent to $1,270, the third-highest in records dating to 1989, the firms said.
Prices in Manhattan have climbed for four consecutive quarters, encouraging more owners to list properties after an inventory shortage last year. With the number of apartments on the market up 28 percent from the third quarter of 2013, buyers focused on those that were not-too-ambitiously priced, said Jonathan Miller, president of New York-based Miller Samuel.
“We’re seeing prices rise and they’re paying more than they were a year ago, but they’re not getting carried away,” Miller, a Bloomberg View contributor, said in an interview. Buyers are “willing to pay at or above list, but only when at or above list” is reasonable for the market.
Total sales slipped 13 percent from a year ago, when transactions set a third-quarter record.
The listing discount, or amount owners agreed to cut the asking price in order to strike a deal, was 1.1 percent in the most recent quarter, suggesting buyers and sellers were often in agreement on the property’s value from the outset, Miller said.
Among completed sales, 49 percent matched or exceeded the listed price, the biggest share in six years, Miller Samuel and Douglas Elliman reported. Buyers who bid more than what sellers were seeking paid about a 4.1 percent premium, on average.
“Sales are strong where properties are properly priced and justifiably priced,” said Hall Willkie, president of brokerage Brown Harris Stevens, which also released a report on the Manhattan apartment market today.
As many as 25 percent of units listed for sale right now might be considered “overpriced,” Willkie said.
Brown Harris and its sister brokerage, Halstead Property, said the median sale price in the third quarter was $898,500, up 3 percent from a year earlier. In separate reports today, brokerages Corcoran Group and Urban Compass also said prices gained 3 percent.
“A year ago, I felt like we were showing signs of a really frothy market just because everything was so frenzied,” said Sofia Song, head of research at Urban Compass, which reported a median sale price of $910,000. “Everything is calming down and it’s acting like a much more normal market -- and more normal is good.”
Condo and co-op sales completed in the three months through September totaled $6 billion, the most since the market peaked in the second quarter of 2008, Urban Compass said. The value of contracts signed in the third quarter was $5.03 billion, according to the brokerage.
For Susan Michael and her husband, it took a year of searching, and one broken deal, to find a well-priced home that met their needs. The couple, with their 5-year-old son and 14-pound Jack Russell terrier, relocated to Manhattan from Los Altos Hills, California, and were seeking an apartment with at least four bedrooms and some outdoor space.
While they were willing to spend as much as $6 million, they found many properties meeting their criteria were priced at $8 million or more, with little consistency as to what that money would buy, Michael said. In one building, for example, she saw two similar condos listed for resale at $1 million apart.
Working with Douglas Elliman broker Robert Schlederer, the couple thought they found a perfect fit at an Upper West Side townhouse listed for sale at $7.39 million after a price decrease, Michael said. An agreement for close to that amount fell through when the sellers insisted on taking the chandeliers and fixtures, among other conditions, she said.
After that deal collapsed, they found a 20-foot (6-meter)- wide townhouse on East 62nd Street, with an asking price of $7.295 million. Their $7.2 million offer was accepted and they completed the purchase in August.
“A lot of places I saw are still on the market,” Michael said. “Places that I would have liked to have gone to view have now come down to our price range, but it’s too late.”
In the luxury market, the top 10 percent of all sales, the median price jumped 22 percent in the quarter to $5 million, Miller Samuel and Douglas Elliman said. The number of purchases dropped 13 percent, even as the supply of apartments in the category increased 47 percent to 1,627 units.
Inventory in all price ranges has increased since hitting a 25-year low in the fourth quarter, Miller said. With 5,828 units for sale, the number of listings is still 18 percent below the quarterly average for the last decade.
Corcoran Group said the median price of previously owned condos on the Upper West Side climbed 5 percent from a year earlier to $1.45 million. On the Upper East Side, the median dropped 8 percent to $1.13 million as smaller units made up a bigger share of sales, the brokerage said.
Downtown, the area south of 34th Street through Tribeca, resale condos traded for a median of $1.77 million, up 2 percent from the third quarter of 2013, according to Corcoran.
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