A wealth of inventory and a lack of demand has contributed to a 2% price drop in Manhattan’s luxury real estate prices, according to StreetEasy’s latest market report released Tuesday.
October data showed the median resale price of luxury homes—defined asrepeat sales within the top 20% of the market—in the borough dropped 2% year-over-year to $4.317 million, the lowest level since 2014, according to the report.
Top Concession for New Development Buyers: A Price Cut https://t.co/rRJ7MZjoSL pic.twitter.com/5vb5cI4PfI
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In Brooklyn, the median resale price of luxury homes dropped 3.6% to $1.627 million, close to its lowest level since May 2016. In Queens, the medianresaleprice for a top-tier home rose 6.9% to $1.036 million, the report said. The report did not have data for the Bronx or Staten Island.
"The onslaught of high-end development in Manhattan and Brooklyn shows no signs of slowing down," said StreetEasy senior economist Grant Long. "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."
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Luxury homes across the three boroughs are also taking longer to sell than in October of last year. In Manhattan, the median amount of time that the homes spent on the market rose 15 days to 157 days total compared to 2016. In Brooklyn, luxury homes spent a median 66 days on the market, 11 more than last year. In Queens, luxury properties took 95 days altogether to sell, 46 days longer on the market than last year. This data analysed both resale and new development sales.
"The luxury market in 2018 will continue to favor the buyer, who will likely encounter increasingly anxious sellers willing to slash prices as more new construction hits the market," Mr. Long said.
Take for examplethe two-unit spread at Trump International Tower that’s currently listed for $27.5 million, a 31% price cut from the $40 million wanted for the combined apartments last year. Or the Plaza Hotel apartment that listed Monday for $25 million, an almost 50% discount from its original asking price in 2014.