Manhattan apartment prices keep rising

By Lauren Elkies | January 03, 2008 11:44AM

The Manhattan residential market saw prices rise to record levels in
the fourth quarter, bucking the traditional weak final quarter trend.
At the same time, however, the quarter saw some of the impact of the
credit crisis, with a marked drop in sales volume.

The average and per square foot sales prices set records, according to
a Prudential Douglas Elliman market report, prepared by Radar Logic and
released today. The average sales price was $1,439,909, up 5.1 percent
from the third quarter, and the average price per square foot was
$1,180, 3.1 percent over a quarter earlier. The median price was down,
however, 1.7 percent from third quarter 2007 to $850,000.

“From third to fourth quarter you tend to see a drop in pricing,” said
Jonathan Miller, executive vice president and director of research for
Radar Logic. “The reason we didn’t see it in price per square foot is
the luxury segment was so strong — the gains were so pronounced that
it skewed the other indicators upward.”

Closings in Pricey Buildings Like The Plaza Hotel Residences and 15
Central Park West pushed prices up. Sales in the two buildings
represented 7 percent of all condo sales in the quarter, according to
Brown Harris Stevens, which issued a separate market report today with
different data but some similar findings.

At the high end, the median sales price of a luxury apartment — the
upper 10 percent of all condo and co-op sales — was also a record
breaker. In the last three months of the year, the median price was
$4.3 million, up 8.9 percent from July through September, according to
Elliman data. Even more dramatic was how much the median price trumped
last year at the same time — by 28.4 percent.

While the eruption of the credit crunch did not seem to affect sales
prices, it was tangible in transaction volume and days on market. Sales
plummeted 28 percent between the third and fourth quarters, to 2,518
units, though the number was up 3.2 percent year-over-year.

Twenty-eight percent is a large number, but “it’s not out of character
with what we’ve seen over the last five years,” Miller said.

Units lingered on the market for an average of 131 days, 6.0 percent,
or eight days, longer than a quarter earlier, when apartments were
taken in 123 days. Days on the market were by 12.4 percent fewer in the
fourth quarter, though, than the same quarter in 2006.

“It’s a seasonal change,” Miller said.