Condo Closings and New Development Prices Surge

The Manhattan real estate market is going strong. According to Streeteasy’s second Quarterly Report of the year, the Manhattan condo market is 3.9% below its 2008 peak. The volume of closings jumped 45.8% from last quarter, and 12.1% from last year. Signed contracts are also up by 21.8% from last year, and 34.8% from last quarter.

Peter Bazeli, Senior Vice President at the Weitzman Group says in an interview with the Vice President of Research at Streeteasy—Sofia Song—that “…domestic purchasers realize that we’re dealing with blue chip real estate. There’s only so much New York real estate, and there’s only so much land for it.” According to Streeteasy’s report, time on the market has decreased to 102 days from 149 days last year.

Interestingly, even though total inventory has decreased 11.4% from last year, properties costing over $3 million have seen an increase in inventory.

According to Brazeli, “Most households in Manhattan really want to spend somewhere between one and three million dollars, and so much of the new development that’s taking place in New York City over the last few years has been much higher than that…there’s been very little product that has been entering the market that is smaller in size…”

This seems to coincide with Streeteasy’s statistics stating that the new development median price increased by 51.0% in the last year. However, 59.9% of closings were still under $1 million, and the average sale price for townhouses—primarily focused in the Upper East Side—actually decreased 12.1% in the last year.

The overall market may be down from last year by 1.2%, but Bazeli remains optimistic about the strength of New York real estate and “There’s no doubt about it” that condo prices will exceed their peak in 2008 before the year is over, possibly as soon as this Fall.