It is not exactly breaking news that prices go up with an apartment’s floor number. But just how much they go up may surprise you.
At The Real Deal‘s request, Jonathan Miller, president and CEO of the appraisal firm Miller Samuel, analyzed closed 2009 co-op and condo sales in Manhattan. The results show that not all floors are created equal when it comes to price jumps.
The first floor was the odd man out, and the only one where per-square-foot prices were below $800. The second floor logged the first major “price break” — a 19 percent jump.
But prices remained relatively steady until the sixth and seventh floors. On the sixth, prices actually dipped below $900, but then they jumped above $1,000 on the seventh. They remained high on the eighth floor, until dropping under $1,000 on the ninth floor again.
Why the zigzag? Miller, along with brokers and developers, attributed the price fluctuations from the sixth to the ninth floors to several key factors at the core of city life.
Those are the floors where, in the right apartment, an owner can clear New York’s ubiquitous six-story buildings, gaze over the trees in Central Park, or see far enough to admire the Hudson or East rivers. And people will pay for that “break,” skewing the price up for those few floors. Without those “breaks,” it’s just another (albeit higher) floor.
“That is the floor that, typically, when you sit down on a couch in your living room, you can see the park or the river,” said Deanna Kory, a broker and senior vice president with the Corcoran Group who, along with her team, has done more than $1 billion in sales.
Contextual zoning rules have also spawned a generation of “base and tower” buildings, which set back as they rise. That can leave developers stuck with dark lower-floor apartments, said Jon McMillan, director of planning for developer TF Cornerstone. He noted that these “bases” are often between six and 10 floors, adding another factor to the “price break.”
All this can be difficult for sellers who don’t realize a “view break” changes a selling price. “You can’t understand when you are on Central Park West and someone two floors above is getting $2 million more,” said Donna Olshan, president of the Midtown-based Olshan Realty.
But the permutations of price and elevation don’t stop on the ninth floor.
Miller’s data indicates that, after a certain point, differences between floors recede. So the price per square foot on the 20th floor, at $1,418, wasn’t much different than the price on the 22nd floor, $1,347.
It is also not axiomatic that upper-floor apartments offer striking views. “You could go higher and face right into a water tower,” said Suzanne Sealy, a senior vice president and broker with Prudential Douglas Elliman who has sold units in more than 30 Park Avenue buildings.
Miller’s analysis also found quantitative evidence that, yes, apartments on the 13th floor are statistically unusual (note that floor’s small market share for 2009 sales). That superstition, it seems, dies hard.
But while higher-floor apartments often come with steeper price tags, don’t overlook the hidden charms of lower-floor apartments, brokers and developers say. There are third-floor units that look into a garden courtyard, or maisonettes that, as Sealy said, feel like “private homes with a doorman.”
But generally: “The farther you get away from the street, the more valuable the property gets,” Miller said.