To paraphrase Mark Twain, the rumors of the death of New York City’s residential market were greatly exaggerated.
After a year-and-a-half slowdown, apartment sales have clearly sprung back to life — part of a revitalized bull market where open houses are crowded once again.
This month, a spring roundup by The Real Deal takes a look at the new environment from multiple angles — at the change in pricing that has helped sellers lure buyers, how New York City stacks up against the national market (favorably), the best and worst case scenarios going forward, as well as the prospect for a new condo development glut now.
A strong fourth quarter of 2006 — when the market came back to life, with a jump in sales and a sharp drop in homes on the market — was followed by more strong sales activity in January, up 20 percent from the same time a year prior, according to Miller Samuel appraisers.
Bidding wars are back, brokers say, and the uptick is clearly visible at open houses.
They “are mobbed, with 50 people, 70 people,” said Frederick Peters, president of Warburg Realty Partnership.
Stacking us up against the national market, New York City’s unique position comes into greater relief.
Nationwide, the median sales price of a home inched up only 1.1 percent in 2006, according to the National Association of Realtors.
In Manhattan, the median sales price for an apartment was up nearly 10 times that amount. Prices were 10.7 higher in 2006 compared to 2005, even though sales were generally slow for most of the year because buyers didn’t want to pay high prices.
Sellers have been pricing properties more competitively in recent months, and because sellers are lowering their prices, buyers appear to be taking the bait. But pricing discounts could be on the way out again, as a study by property listing Web site Streeteasy.com found.
Still, there are some storm clouds on the horizon, including a rising number of foreclosures and more new development coming on the market, which could cause oversupply and drag down prices. The stock market and economy are another concern.
Not everyone is a believer that New York is immune from the general national slowdown. For some, the revival may be short-lived. “New York is the anomaly,” said Barry Hersh, associate director of the Steven L. Newman Real Estate Institute at Baruch College. “I just think it won’t continue to soar while the rest of the country is going down. How can New York be an island?”
Spring comes early to Manhattan market
New York City stays afloat while rest of U.S. sinks
Price cuts spark residential sales activity