A sinking island
A survey of top listings and biggest price cuts around Manhattan -- and how much further they might need to fall February 28, 2009 11:15PM By Sarah Ryley
In this volatile market, it is difficult to predict the bottom. But many analysts today agree sales prices have to fall significantly from the market's peak for property to move. Not all markets in Manhattan are the same, so The Real Deal commissioned custom data on past sales from PropertyShark.com and on current listings from StreetEasy.com to gauge which markets have already seen a decline, how far off the current listing prices are from recent quarters and which areas are seeing the most price cuts. Jonathan Miller, president of appraisal firm Miller Samuel; Sofia Kim, vice president of StreetEasy.com; and Beverly Sonnenborn, a vice president of Sotheby's International Realty, also agreed to comment on the price of a sample listing in each market.
Click here for The Real Deal's map of Manhattan's biggest price cuts
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Comments
Anonymous
I have a real problem with the Sinking Island analysis here. From your map, one cannot discern whether the median sales and listing prices included are specific to condos, co-ops, townhouses or all of the above. Moreover, the data does not appear to account for the price differential between resales and new construction. Such information must be disaggregated and accounted for when analysing price trends and discounting, otherwise you end up with skewed numbers, unweighted averages, and a faulty analysis. And that is what this is. Without appropriately categorizing properties and their corresponding prices beyond geography, you cannot accurately measure what is happening to the Manhattan residential market.
Comment #1 Posted By: Anonymous 03/02/09
Anonymous
The numbers have to be skewed and even in the shadows because there's not much to see. 10% price cuts, 8% price cuts off of listing prices that were too high to begin with. I'd like to add that the so called analysts are brokers and of course they want to see significant drops, they have no deals. I intend to hold out until this over. If you don't absolutely have to sell, don't sell. The real deal has become a gossip rag chomping at the bit to see a huge crash. It won't happen.
Comment #2 Posted By: Anonymous 03/04/09
Anonymous
#2 - I LOVE it!! Chin up! Please don't sell now. Sell in a year when (maybe) I'll buy your apt for 50% less than you could get today. I didn't think there was anybody left in denial about the freefall of Manhattan real estate... Ah, but one need look no further than the comments section of The Real Deal. I can't wait until the deals that are happening now become public and set new price levels, which of course will be become the new basis for discounting even more. I also can't wait for the condo auctions and shadow inventory of 22,000 condos to add to an already bloated NYC inventory of 10,000+ (!!!) apartments. But #2, don't worry. You keep waiting. You'll get your ask... ;)
Comment #3 Posted By: Anonymous 03/04/09
Anonymous
#3 - Hey, #2 has sentimental values for his property! He's not gonna sell for the $100k he's about to get in the future if he did, but he wouldn't sell for $10M either. ;) As for #2: It's a buyers market now and will be for years to come. Better get used to the thought. Or start buying other condos to pep up overall prices.
Comment #4 Posted By: Anonymous 03/04/09
Anonymous
It's amazing how quickly Manhattan real estate has gone from what everybody wants to own to a colossal burden for owners.
Comment #5 Posted By: Anonymous 03/04/09
Anonymous
There is no colossal burden in having real estate in New York. It's imaginary. The deals that are happenining now are averaging 8-15% off the peak market. Shadenfreuders are gonna take it in the butt on these expectations.
Comment #6 Posted By: Anonymous 03/06/09
Anonymous
#6 - wow, you are in some serious denial, my friend. Brokers on the front lines are indicating deals getting done 20-25% off peak. I actually think that data is now stale, and deals are getting done at even lower levels. What tells me that we are in for a greater world of hurt is that so few deals (still) are getting done. The "uptick" that brokers were talking about in Jan and Feb has failed to materialize, and inventory has grown to 10,500 - and climbing. The amount of pain being felt by NYC sellers and apartment owners is bad enough now, but it's going to get much worse. It's a simple case of "you don't own your apartment, your apartment owns you." NYC apartment owners won't even be able to move if they have to, when they are underwater on their apartments to the tune of $000Ks or even $millions.
Comment #7 Posted By: Anonymous 03/06/09
Anonymous
Sorry - meant "hundreds of thousands" - guess that would be $00Ks... Looks funny, though. I'll stick with "hundreds of thousands". Or "lots of money".
Comment #8 Posted By: Anonymous 03/06/09
Anonymous
Per The Real Deal today: "Manhattan home prices are down about 25 percent compared to February 2008, Miller said." I think the decline is over 25%. One thing is for sure, it's in free-fall and getting worse by the day.
Comment #9 Posted By: Anonymous 03/06/09
Ben
I have regularly tracked approximately 30 two/three bedroom apartments that I have personally seen since October 2008. Only one has sold. That apartment, a three-bedroom apartment in great shape just off Park, went on the market for $1.85 Million, and the seller accepted a bid for $1.2 million two weeks ago. Out of the others, eleven have dropped asking prices by at least 15% and have not sold, and four have withdrawn their apartments altogether. The bottom line is this: Apartments are not selling. Asking prices - especially those found online - are an indication of the seller's pipe dream (or, what the apartment may have sold for in 2006) and not the value in today's market. Brokers are litterally begging me just to make an offer. You can just see the frustration they have with clients who will not agree to realistic asking prices. A terrible job market. Buyers with crushed stock holdings. Higher real estate taxes in NYC. New Federal taxes targeting exactly the would-be buyers of these apartments. Everything I see first-hand shows that prices are headed down from here.
Comment #10 Posted By: Ben 03/06/09
Anonymous
I went to an open house last week and I think the only other person who showed up might have been Ben. There is so little demand, people aren't even going to open houses!
Comment #11 Posted By: Anonymous 03/06/09
Anonymous
Does anyone really think that the stock market can lose 50% (and more than 25% in the last three months alone) and that in NYC -- which lives and dies with Wall Street -- the real estate market would not follow? I'm sure a lot of folks (me among them) thought that the Dow at 10,000 must be near a low after losing 4,000 points. Now, many are making the same mistake in real estate. Just like the stock market, when the real etstate market finally gets hit in NYC, it is going to be ugly. Real ugly.
Comment #12 Posted By: Anonymous 03/06/09
Anonymous
Keep drinking the kool-aide folks. As homes in Palm Beach and the Hamptons slide into foreclosure, there will absolutely not be any effect on the prices in NYC. The dow at 5800 in 3 weeks will not have any effect at all either. We are unique. Any discount off peak is a bargain. Buy NOW or be priced out forever! Please buy now, please...please.
Comment #13 Posted By: Anonymous 03/07/09
Anonymous
#13 - why should we? This recession is gonna stick around for at least another year, even if the 10000th congress approved aid package is to trickle through. Home prices certainly won't pick up before then. Considering the global scale of this crisis and the high amount of foreign investors in the NY/Manhattan real estate market, it's not even a given that they will pick up EVEN IF our economy starts rolling again! So perhaps you are right, for today's standards there already are some bargains to be made... but with so many other 'bargains' waiting in line and today's standards getting crushed by tomorrow's numbers, this alone certainly doesn't make the case. Good luck for you though.
Comment #14 Posted By: Anonymous 03/10/09
Anonymous
I don't trust the price analysis done by any of these broker outfits. They are full of it.
Comment #15 Posted By: Anonymous 03/11/09
Anonymous
History repeats it'self. I would love to buy an apartment in NYC, but is it really worth buying a studio for $1/2mill? no way jose, I rather rent the same space uptown for $800 bucks a month and keep the rest in my account or play it in stocks. With maintanence fees in some co-op in the tune of $500 to $1000/month, who needs to own a white elephant? thank you
Comment #16 Posted By: Anonymous 03/12/09
Anonymous
What happened to all the comments on this thread? Has The Real Deal censored the commentary? WTF??? Who are you afraid of?
Comment #17 Posted By: Anonymous 03/14/09
Anonymous
The Real Deal is hakery at it's finest. Bought and paid for by the industry it reports on. The Fox News of real estate. Anyone who dares to question their fundamentals is censored. The desperation of their master's is palatable.
Comment #18 Posted By: Anonymous 03/14/09
Anonymous
Back in the US... back in the US... back in the USSR!!
Comment #19 Posted By: Anonymous 03/15/09