Residential market report

From Manhattan’s latest sales price decline to new records for Downtown, a look at the biggest trends

Aug.August 01, 2018 12:00 PM

Philadelphia 76ers co-owner Michael Rubin went into contract for the penthouse at 160 Vestry Street for more than $40 million. (Credit: CityRealty)

Red all over: Rents and sales fall in Manhattan

The median sale price for a Manhattan apartment fell for the fourth straight quarter, down 9 percent year-over-year in 2018’s second quarter, according to a Halstead Property report. The average sale price fell too, by 4.3 percent, per City Realty, as did asking prices, by 3.4 percent, according to Maxwell Jacobs. Rents weren’t spared either, with a 2.9 percent year-over-year decline. All of the drag in the sales market came from new development, which saw a 19 percent year-over-year chop to the median price, bringing it to $2.7 million, and a 37 percent drop in sales volume, according to a Douglas Elliman report. The resale market, on the other hand, which made up 87 percent of the transactions in the second quarter, ticked upward by 0.5 percent. In the outer boroughs, things were also less dire. In Astoria, the number of sales tripled, while the median price increased by 13 percent year-over-year, according to Modern Spaces. Eric Benaim, CEO of Modern Spaces, said the tight sales market was largely due to low inventory.

Resale inventory hits highest point in eight years

Manhattan resale inventory has been increasing steadily since 2013, and this spring, it accelerated to 5,956 — up 12.6 percent from the previous year. For the past three quarters, resale inventory has climbed significantly, while the number of deals declined, according to data from Douglas Elliman. “It has a lot to do with the tax law,” said Jonathan Miller of Miller Samuel and author of the Elliman report. “When there’s an unknown, people pause. They want to get comfortable.” But while inventory is up and sales are down, the market is not in decline, Miller maintained. There were 2,277 resales in the second quarter, almost exactly in line with a 10-year quarterly average of 2,256. In addition, 9 percent of homes sold above their asking prices, a sign that there’s still plenty of demand despite the high inventory.

Comptroller pushes for security deposits cap

City comptroller Scott Stringer wants to put an end to landlords asking for more than one month’s rent as a security deposit. A report from Stringer’s office found that renters paid approximately $507 million on security deposits in 2016. A family of four earning New York City’s median income and leasing an apartment at the median $2,965 monthly rent, for instance, would need to pay 6 percent of their income before even moving in — and that’s if the security deposit is only one month’s rent, according to the report. Stringer is advocating for a one-month cap on security deposits, more options for how the deposit is paid (such as installment and insurance plans) and more ways to regulate how the security deposit is returned. “Right now, the landlords are collecting all this money, and it’s doing nothing for the tenants,” Stringer said.

Downtown sees new townhouse and penthouse records

The sale of a Greenwich Village townhouse for $37.2 million in July — four times its last sale price of $9.5 million in 2012 — set a new record for the Downtown townhouse market. The five-story home at 37 West 10th Street replaces the previous record holder, a house on the same block that sold for $35.4 million in 2007. Not to be outdone, the condo market also made waves last month. Michael Rubin, co-owner of the Philadelphia 76ers, went into contract for the penthouse at 160 Leroy for more than $40 million, which would make it one of the priciest penthouse sales below 14th Street once it closes. The record is held by a $47.8 million sale at 56 Leonard Street, but that could soon be exceeded by the penthouse at 70 Vestry, which went into contract for $65 million in June. These sales are reflective of the fact that the ultra-luxury market is seeing more movement than it did in 2017. There were 22 residential sales above $20 million in the second quarter, according to Stribling. For condo sales, that’s 67 percent more than last year.

Correction: A previous version of this story incorrectly stated that Michael Rubin bought the record-breaking penthouse at 160 Vestry Street. The post has been updated to reflect the sale occurred at 160 Leroy.

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