While Donald Trump is tied with Hillary Clinton in the presidential election in some polls, his condos, at least some of those in the U.S., aren’t faring as well, price-wise.
A market analysis of Trump-brand condominiums from Jan. 2015 to May 2015 by Seattle-based real estate listing firm Redfin showed before Trump announced his candidacy for the Republican nomination, Trump units outside of Manhattan had a sale price premium of as much as 6.8% versus other luxury units. The condos were compared with similar non-Trump brand models based on location, size and bedrooms. On a per-square-foot basis, that’s an equivalent premium of 9% or $97 a square foot.
Redfin also noted that Trump condos were typically listed at about 1.6% above other similar listings during the same six-month period in 2015.
During the same six-month period in 2016, the Trump brand, at least outside of the red-hot Manhattan market, doesn’t command such respect, at least in terms of price.
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“Trump condos have lost the price advantage they enjoyed before the campaign and are starting to sell similarly to comparable condos,” said Redfin chief economist Nela Richardson, whose firm looked at more than 160 Trump condo sales in nine markets, including popular vacation spots like Hollywood Beach, Fla., Las Vegas, and Honolulu, and big markets like Chicago.
A representative of Trump Hotels told MarketWatch, “A one-bedroom unit at Trump Chicago sold this year at a record breaking price. The building is very hot and units are in high demand... There is clear evidence that the premium placed on Trump properties is as strong as ever.”
A spokesperson from the Trump campaign did not return requests for comment.
Overall, Redfin looked at about 1,100 sales within a half-mile of a Trump property for its analysis and included similar amenities such as waterfront views. Still, the Redfin analysis also excluded hot international markets like Toronto and Vancouver.
Trump’s incendiary remarks during the political campaign have cost his developments some amenities and big-name stars.
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Earlier this week, former MSNBC host Keith Olbermann announced via Twitter he sold his three bedroom condo in Trump Palace for $3.9 million, after putting it on the market in April and taking a loss from his 2007 purchase price of $4.2 million. “I got out with 90% of my money and 100% of my soul!” Olbermann tweeted. “Now that I’ve escaped, I can report to you that the market in NYC @RealDonaldTrump apartments is in a free fall.”
Olbermann isn’t the only one who’s been inspired to break real estate ties with Trump over politics. Last summer, Trump, who is building a luxury five star Trump International Hotel along Pennsylvania Ave. in Washington, D.C., suffered a public-relations black eye when his two high-profile restaurant partners for the hotel, celebrity chefs Jose Andres and Geoffrey Zakarian backed out of Trump’s plans, citing the presidential candidate’s remarks last June about illegal immigrants bringing crime and being “rapists.” NBC also cut ties will the billionaire developer as did Macys with Trump’s clothing line. Indeed, the Hollywood Reporter noted in March that about 10% of Trump Tower’s units were for sale or rent and that prices had been reduced from their initial listing.
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Still, despite Olbermann’s politically inspired-sale, the billionaire developer’s occasionally crude remarks probably had little to do with the relative decline in the Trump brand, Richardson said.
“While it’s tempting to blame politics, it’s likely that market conditions have changed, making it harder for uber-luxurious condos to fetch top dollar,” she said. “The luxury market has been fighting a chill since late last year and even the gold-plated faucets in Trump’s bathrooms can’t overcome a slowdown in demand from wealthy buyers caused by the rocky global markets in 2016.”
U.S. luxury home prices — defined as homes in the top 5% of their market in a given quarter, or an average price of $1.59 million — fell overall 1.1% compared with last year in the first quarter of 2016. Moreover, only 1.2% of those luxury homes sold above their list price, Redfin said in May.
And Olbermann’s pronunciations aside , Trump is still king of New York, where his dozen-plus condo projects command a healthy premium versus all other condos in the city and the surrounds, according to CityRealty, a Manhattan-based real-estate research firm. In 2016 Trump-brand condos in Manhattan averaged $1,974 a square foot, compared with $1,873 a square foot for all other condos, a 5% premium advantage, CityRealty said. Trump also had a similar 5% margin in Manhattan in 2015, said Gabby Warshawer, CityRealty’s director of research.
“The premium for Trump-branded condos in Manhattan compared to all other condos has actually remained consistent,” she said, though the margin varies from year-to-year. A Trump brand condo could command as much as a 24% premium just four years ago in 2012.
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There’s more competition from new luxury buildings, she said, like One57 on so-called “Billionaires’ Row,” where a penthouse apartment was sold in December 2014 for over $100 million.
Moreover, buyers outside Gotham haven’t shied away from the Trump brand, despite the rancorous political race and Trump’s controversial statements.
In May, a condo at the Trump International Hotel & Tower in Chicago sold for the highest per-square-foot price on record in Chicago, with a 1,450 square-foot condo on the 41st floor of Trump’s new hotel selling for $1.64 million, or $1,127 a square foot, outpacing other similar units like those of the Ritz Carlton Residences, one which sold for about $1,096 a square foot in 2014. The Trump condo also saw rapid price appreciation, as it was purchased for $1.22 million in Sept. 2014, or $837 a square foot. Still, Redfin noted that five other condos in the same Trump building sold for a more modest $750 a square foot in the past year.
In April, Trump Hotels announced that the 63-story Trump International Hotel & Tower in Vancouver had sold all 214 units at an average price of $1,610 a square foot. “A higher price a square foot than any other property in Canada,” Donald Trump Jr. said in a statement.