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New York

Market for starter apartments heats up

Manhattan’s lower-end home-seekers are recognizing that market conditions favor a purchase and it’s beginning to show up in the data. Citing Prudential Douglas Elliman data, Crain’s reported that sales of starter apartments, defined as studios and one-bedrooms that attract price-sensitive buyers grew to account for 56.2 percent of all closed transactions in the first quarter of this year, up from a 10-year average 50.9 percent.

And that growth will likely continue into the next quarter as contract signings for entry-level apartments in the first quarter rose 19 percent for studios and 11.6 percent for one-bedrooms, according to year-over-year data from Streeteasy.com.

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Crain’s said a confluence of factors is helping the market. Rising Manhattan rents are making purchases relatively affordable, prospective buyers are becoming confident that the market has already bottomed out and positive economic indicators are leaving buyers more comfortable with their finances.

At the still-under-construction 37-unit condominium at 422 West 20th Street, for example, one quarter of the units are one-bedrooms starting at $650,000 and all but one is already under contract even though sales first launched late last month. [Crain’s]

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Douglas Elliman