After several years of soaring prices, Manhattan real estate leveled off in 2017 with the luxury housing market showing signs of fatigue, according to a CityRealty report released Wednesday.
Total sales of apartments over $10 million in Manhattan are projected to reach $4.7 billion by the end of 2017, according to the “Year-End Manhattan Market Report” by CityRealty, a New York City real estate website. By the end of November, 240 apartments over $10 million had sold this year. The number of apartment sales in this price tier is down from 2016, which saw a record 297 sales, totaling $5.3 billion.
Total sales of apartments in this price range will account for 18% of all dollars spent on Manhattan residential real estate this year compared with 20% last year, according to the report.
“It’s not a huge drop from last year, and it is still the second highest number of sales [of apartments over $10 million] in Manhattan history,” said Gabby Warshawer, director of research at CityRealty. Oversupply in the top end of the market is the reason “the luxury market does look slightly weaker than the Manhattan housing market,” she said.
The average price of a Manhattan apartment remained unchanged in 2017, according to CityRealty, but the report projects that it will actually dip slightly in 2018, to $2.1 million from $2.2 million, with prices reflecting a softer Manhattan luxury market.
The priciest sale of 2017 as of the end of November is a $65.7 million closing at 432 Park Avenue, the tallest residential tower in the Western Hemisphere, which is the sixth-most expensive apartment sale ever recorded in New York, according to the report. An anonymous buyer closed on the contract to buy a full-floor unit in January, public records show.
Manhattan has seen a trend of new ultra-luxury developments with higher asking prices in recent years, with the opening of high-profile and high-priced buildings like Central Park Tower at 225 West 57th St., whose projected $4 billion sell-out would be the largest in city history; 220 Central Park South, with a price-per-square-foot asking price of $8,400; and One Manhattan Square, which will be bringing 815 new units to the Lower East Side.
“The onslaught of high-end development in Manhattan and Brooklyn shows no signs of slowing down,” said StreetEasy senior economist Grant Long in a previous interview with Mansion Global. “Sellers are having a hard time finding buyers without offering severe price cuts, often to levels below their original purchase prices. This isn’t a new phenomenon, but with too much luxury inventory already on the market and even more supply to come, this trend isn’t over.”
High-end home buyers will probably have a bit more room for negotiation in 2018, Ms. Warshawer said.
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