Signs of softening? Contracts for $10M+ pads drop 16% in 2015: Olshan

Properties spent two months longer on market

Dec.December 28, 2015 11:28 AM

Buyers of pricey Manhattan real estate tapped the brakes in 2015, according to Olshan Realty’s year-end market report, which revealed a 16 percent drop in the number of contracts signed on residential properties $10 million and above.

Overall, contracts signed on pads $4 million and up were relatively flat at 1,344 deals, compared with 1,340 in 2014, according to the report. But that doesn’t quite tell the whole story: Total sales volume dipped to $10.7 billion in 2015 from $11.3 billion in 2015. And there were 227 contracts at $10 million and up, down from 270 in the same price bracket in 2014.

The report noted heavy sales activity at the start and end of the year, with several sluggish months, specifically September and October. “In the last four months, there have been only 4 strong weeks with 30 or more contracts signed,” the report says. Those weeks took place in November and December.

In 2015, the number of days a property spent on the market also jumped to percent to 243 days, compared with 181 days in 2014. “You read that right—it took two months longer to sell a luxury property in 2015,” the report states.

Given the influx of residential construction in Manhattan, 34 percent were new units sold off of floor plans. But that’s a drop from 2014 and 2013, when 41 percent and 38 percent of contracts were signed off of floor plans respectively.

In recent months, developers have described a softening in the luxury market, and the luxury market hasn’t been immune to price chops.

Buyers’ preference for condos intensified, with condos outselling co-ops more than three-to-one: According to the report, 74 percent of contracts $4 million and up were condos compared with 69 percent in 2014 and 68 percent in 2013.

Downtown ruled the roost with the number of contracts signed, accounting for 45 percent of luxury sales.

Other findings include the following:

  • The average asking price was $7.9 million in 2015, down from $8.1 million in 2014;
  • The median asking price was $6.3 million in 2015, down slightly from $6.4 million in 2014;
  • The average price cut was 5 percent in 2015, versus 4 percent in 2014;
  • The average townhouse price rose to $10.9 million in 2015, up from $10.3 million in 2014;
  • The average condo price dropped slightly to $7.7 million in 2015 from $7.8 million in 2014.

For the last full week of 2015, Olshan Realty tracked a total of 15 contracts signed on properties $4 million and up.

The top contract was Penthouse 22D at the Beresford at 211 Central Park West, asking $20 million. Sold by the estate of Cosmopolitan editor Helen Gurley Brown, the very pink co-op penthouse encompasses part of four floors and has two bedrooms, three terraces, two fireplaces and two maid’s rooms.

The No. 2 contract was a townhouse at 46 East 81st Street, asking $17.95 million down from $18.6 million in January 2015, when the property hit the market. Previously, the 5,400-square-foot home was previously listed for $13.5 million in 2010, but it failed to sell.

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