By Carter B. Horsley
Reports for the second quarter
of 2009 released today indicated that the Manhattan luxury condo
and co-op apartment markets continue to be weak and are faltering,
although they have not collapsed.
The Brown Harris Stevens report
noted that "an 82 percent decline in closings over $10 million
helped bring the average cooperative price down 29 percent from
the second quarter of 2008 to $918,795" while the average
price of a condominium apartment declined only 18 percent from
the previous year's second quarter but the report noted that if
closings at The Plaza and 15 Central Park West were removed, the
average condo price "would be just 2 percent lower than a
This report found that "new
development apartments sold for an average of $1,198 per square
foot," 16 percent less than the comparable period a year
ago. It also noted that apartments spent an average of 129 days
on the market, 48 percent longer than the same period in 2008
and that sellers received 92.6 percent of the last asking price
for their units compared to 97.5 percent a year ago.
The Prudential Douglas Elliman
report, prepared by Miller Samuel Inc., found that "there
were 1,532 co-op and condo sales in the current quarter, 50.3
percent below the 3,081 sales of the prior year but up 28.2 percent
from the prior quarter."
"Listing inventory is
up a modest 7.8 percent to 9,378 units from 8,626 units in the
prior year quarter, but fell by 10.2 percent from the prior quarter
total of 10,445, the highest quarterly level in a decade,"
the report continued, noting that "First time and entry-level
apartment buyers played a key role in the increase in activity
this spring, albeit seasonal, with a 54 percent entry-level market
share, up from 50 percent in the prior quarter."
the study declared, "has seen limited changes to pricing
despite the fall market correction, reflected in the decline of
new development market share. In the current quarter, market share
of new development units sold fell to 27 percent from 35 percent
in the prior year quarter and from 42.8 percent in the prior quarter.
The 73 percent re-sale market share in the second quarter was
at its highest level since the second half of 2007."
The report declared that "the
days on market for Manhattan condos exceeded six months for the
first time since this metric has been tracked over the past decade."
"In terms of reflecting
the recession's initial impact, this quarter and the next will
be the most telling in terms of establishing a new level of pricing
for Manhattan," declared Pam Liebman, chief executive office
of the Corcoran Group.
"It is no secret that,
since3Q 2008, Manhattan's housing market has experienced one of
its most challenging periods in twenty years," she said,
adding that "in the wake of the global financial crisis,
home sales in the borough have slowed by half. Total closings
decreased 50-60 percent of 2008's busy second quarter, but were
up by 10-15 percent over the prior quarter as of this writing
and will most likely increase further (based on a reasonable estimate
of additional Second Quarter sales reaching the public record
at a later date). In addition trends in recent months have been
very encouraging with strong seasonal activity in May and June,
particularly in modestly-scaled units."
"As reduced demand and
intense downward pressure has taken a toll on condominium prices
(re-sale condos lost 14 percent in price per square foot), we
have also seen a resurgence of the co-op market as buyers have
found their prices more attractive," according to Ms. Liebman.
"Townhouse sales in every
neighborhood were down approximately 40 percent of more versus
last year," according to the Corcoran report, which also
found that "the loft market experienced a 25 percent decline
in median price to $1,420 million and a 10 percent decline in
average price per square foot to $1,083."
The report from Streeteasy.com
found that "Condo and co-op resale median prices have actually
increased since last quarter but are still significantly down
from a year ago," adding that "the new development sector
has finally begun to reflect the economic climate of the last
two quarters as closing prices have suffered declines since last
quarter and last year, causing the overall Manhattan sale price
to drop by 10.6 percent since last quarter to $760,000, and by
19.1 percent since last year."
"Condo resale median price
increased to $999,000," according to the Streeteasy report,
"with an 11.6 percent increase since last quarter but an
11.2 decrease since last year. Average prices are increased 0/7
percent for the quarter, but are down 17.4 percent since last
year. Co-op resale median price increased to $580,000, an increase
of 4.5 percent compared to last quarter but a decrease of 14.1
percent since last year. Average sales price increased by 2.8
percent since last quarter but decreased by 23 percent since the
prior year. New development median sales price decreased by 15.3
percent since last quarter to $1,078,000 and decreased by 10 percent
since last year. Average sales price also decreased by 13.5 percent
since last quarter and by 10.9 percent since last year."
Streeteasy reported that "there
were 2,477 listings that went into contract this quarter, an 82.4
percent increase from last quarter's number of new contracts (1,358),"
but it noted that "there were 132 broken conracts, a 22.2
percent increase compared to last quarter's 108."