Manhattan is putting the heady prices of the super luxury construction boom behind it—for now at least.
The explosion of ultra high-end developments that began closings between 2014 and 2016—places like the 90-story One57 by Central Park, Madison Square Park Tower in the Flatiron District, 30 Park Place in Tribeca and 432 Park—boosted price metrics in New York City over the past five years. In 2017, the borough recorded its fifth consecutive year of rising prices and the median cost of a Manhattan apartment hit a record $1.14 million last year, according to the "Manhattan Decade" report published Thursday by Douglas Elliman and appraisal firm Miller Samuel.
More:Manhattan Had Its Fifth Consecutive Year of Price Increases
But the report’s luxury data, defined as the top 10% of all co-op and condo sales, offered a hint at the price declines to come. The median price of a luxury home in the borough dipped 1.5% in 2017 over the year prior to $6.531 million.
Average price per square foot for luxury slipped 1.2% to $2,978.
Mansion Global reported on general market-wide data released ahead of the report, but the full publication revealed a shift in the luxury market.
The lull in super-luxury closings will cause pricing indicators to decline over the next several years, said Jonathan Miller, chief executive of Miller Samuel, told Mansion Global.
"I think you’re going to see that pricing will fall in 2018," he told Mansion Global in a phone interview last week. The current cycle of luxury developments are smaller well-appointed units, and therefore less expensive.
But don’t count on the slowdown lasting very long. There are mega developments quite literally looming on the horizon.
The next super prime property cycle will pick up in 2020, kicking off another round of record-breaking price increases, according to a separate report by Douglas Elliman, jointly released by global brokerage Knight Frank.
More:Manhattan Luxury Sales Spring Back
One of the first skyscrapers to kick off the next cycle will be the limestone-clad 220 Central Park South designed by Robert A.M. Stern, where average price per square foot is nearly $9,000, as well as Central Park Tower, billed as the tallest residential building in the Western Hemisphere.
"The next wave of super-prime new developments set to launch through 2020 will be located in classic luxury neighborhoods, but will also continue the trend of expansion across Manhattan," particularly in downtown," said Andrew Wachtfogel, Douglas Elliman’s senior vice-president of research and analytics, in the joint report.