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Manhattan Luxury Resale Prices Fell 2.5% in April

But overall second-hand home prices hit record high, StreetEasy reports

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Luxury resale prices in Manhattan and Brooklyn declined in April.

SAM NEEQUAYE/Getty Images
Luxury resale prices in Manhattan and Brooklyn declined in April.
SAM NEEQUAYE/Getty Images

Resale prices for Manhattan’s high-end homes continued to trend downward in April, falling 2.3% year-over-year to a median of $3.16 million, according to a StreetEasy report released Wednesday.

Resale prices for the luxury segment, defined as the top 20% of the second-hand home market, have been declining on a monthly basis since August 2015, according to StreetEasy.

More:Manhattan Luxury Homes See Robust May

The resale market is seemingly taking a hit from a boom in luxurious new developments, according to Grant Long, senior economist at StreetEasy.

"The competition to build the tallest or hippest luxury building in the city has saturated the New York luxury market with supply,"  Mr. Long told Mansion Global in an email.  "Prices on units built a decade ago cannot keep up with a market in which a new starchitect-designed, supertall building loaded with modern amenities and finishes seems to open every few months."

"With demand struggling to keep up with the pace of construction in the luxury space, luxury resale prices will continue their modest downward trend through the rest of the year," he predicted. And, he said,"overseas developments, including the continued relative strength of the dollar, have softened international demand."

A strong dollar typically hampers foreign buyers’ demand for U.S. real estate properties, as their purchasing power is lessened.

Manhattan Luxury Market Snapshot in April
Submarkets Resale Price YOY change
All Manhattan $3,162,213 -2.5%
Downtown $3,227,492 -10.8%
Midtown $3,514,419 +4.4%
Upper West Side $3,342,961 +6.9%
Upper East Side $2,945,521 -0.2%
Upper Manhattan $1,189,508 +1.1%
Source: StreetEasy

In stark contrast with the luxury segment, the Manhattan housing market overall remained competitive, as median resale prices increased 1.3% year-over-year to $993,592 in April, a record high.

Brooklyn observed a pattern very similar to that of Manhattan. In April, resale prices in Brooklyn’s general market increased 6.3% to $584,121, while the top-tier fell 4.1% to $1.29 million, compared to the same period last year.

Overall and luxury inventories for both boroughs shrank in April. Manhattan saw 6.8% fewer luxury homes and 11% fewer listings overall from a year ago. In Brooklyn, luxury inventory decreased 10.6% while the number of all homes available for sale was down 9.8% compared to the same time last year.

For the general market, especially in the more affordable neighborhoods, resale prices are predicted to move higher as the city continues to see job growth and market confidence improving.

"Echoing a nationwide trend, low inventory in Manhattan and Brooklyn will continue as the New York City economy remains strong, and will likely push prices higher heading into the summer," Mr. Long said.