It isn’t all gloom and doom in the real estate market if you live in Manhattan. Of course, if you read the front cover story in the Sunday’s NY Times real estate section you might have thought otherwise as they smashed the growing inventory and consequential reduced prices of studios. Despite the fact that the core of my business at London Terrace is studios and one bedroom apartments this price drop translates to greater accessibility for more buyers.
Take a look at the article in Crain’s below, however, and you’ll find that prices are inching up in other segments of the market as a result of shrinking inventory. In the last two weeks I found myself in bidding wars for two bedroom apartments in the $1.35 to $1.5MM range. As my friend Henry states below the lack of new developments on the market now has significantly dropped, with inventory off 7% compared to 1st quarter 2010 and 41% against 2009. That category is turning back into the sellers hands so if you’ve found something you like in the two bedroom market in NYC jump on it…it’s likely to increase as the blossoms unfold.
Get ready for seller’s market
Asked recently to conduct searches for two clients seeking Upper West Side apartments—one seeking a four- to five-bedroom, the other a two-bedroom—Malcolm Carter made a startling discovery. The prices on half a dozen apartments that fit the bills had been raised 3% to 4% since they were first listed.
Among them was a 717-square-foot one-bedroom at Trump International at 1 Central Park West, now listed at $1.295 million—up 4% from five months earlier. Similarly, a four-bedroom at The Laureate at 2150 Broadway is $5.2 million, up 3% from just a month earlier.
“Sellers see any market movement as an opportunity to collect more money for their properties,” said Mr. Carter, a broker at Charles Rutenberg Realty.
These days, many of them are seizing that opportunity, driving apartment prices upward across the city for the first time in three years. Most of the increases fall into the modest 3% to 10% range. While that pales in comparison with the boom years, when prices soared by more than 25% in a single year, it is clear that a turning point has been reached and that higher prices are sticking.
Prices started inching up late last year as the residential sales market began to stabilize after years of slipping. Despite conditions in the rest of the nation, where reports last week showed that new home prices had slumped to a seven-year low, here in the city buyers seem to be betting that there is money to be made once again in owning—or at least wagering that prices will not go down from here. Historically low interest rates and a small supply of new units resulting from the construction drought are also contributing to the rising prices.
To read the full article click on over to Crain’s New York Business.