Tuesday, February 26, 2013

Property price in New York after financial crisis

Property price in Manhattan, New York is currently higher than the peak of 2008 and perhaps about 20 percent higher than during the financial crisis of 2009.

Specifically, I am referring to Manhattan luxury condominiums and generally, I am using numbers I have observed over the years.  Reason is that the "official" numbers published by the data houses tend to be average of condos and coops.  Depending on what metric is used, the numbers tend to be skewed.  For example, by very high end apartments, large weighting of coops etc.

Specific to luxury condominiums in Manhattan, New York in the $1 million to $4 million price point, which I seem to do the most of and hence can talk with most "datapoint" observations, I feel that:

1.  Back during the financial crisis days of 2009, $1000 per sqft used to be the benchmark property price.  A higher end apartment sold for $1200 psf while a value buy would be at $900 psf.

2.  Currently, most condos in desirable locations are selling at $1,400psf to $1,800psf.  There is no more $1,000 psf condos.  The average condo price is currently $1,300 psf.

Given that, maybe it's even higher than 20 percent compared to the financial crisis period of 2009.

The current market activity has been extremely hot.  It's a seller's market and they may get 10 offers after a week.  Hence, I won't be surprised that luxury condo prices escalate during the coming Spring.

Wei Min Tan is a Manhattan, New York condominium specialist focusing on global clients interested in Manhattan property as investment.  Weimin's media appearances include being interviewed by CNN, CNBC, Wall Street Journal/MarketWatch and The New York Times.  He can be reached at tan@castle-avenue.com

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