The luxury residential real estate market in Manhattan broke all records of previous market highs in early 2004 before balancing out in the latter part of the year, according to the Stribling Private Brokerage Luxury Residential Report 2005, produced by the Stribling & Associates brokerage.
“As we enter the new year, the Manhattan luxury residential market continues on a strong path that could eclipse the previous year,” according to the report.
“The luxury real estate market led the burgeoning economy during early 2004 and broke through all previous records. In the latter part of the year the market balanced itself and became more stable, until after the elections when the market again burgeoned, especially in the super-luxury category,” said Kirk Henckels, director of Stribling Private Brokerage and author of the report.
The report noted that the super-luxury market has been relatively flat since early 2000, “but in 2004 activity in the $10 million and over market surged, producing record breaking sales such as the $44 million sale of Laurence Rockefeller’s Fifth Avenue apartment.”
The average sale for cooperatives priced at $4 million and up was $7.1 million in 2004, down slightly from $7.2 million in 2003. And the median sale price of cooperates priced at $4 million and up was $5.8 million, almost flat compared to 2003. The average sale price and median sale price of townhouses priced at $4 million and up, meanwhile, dropped 4.2 percent and 10.3 percent, respectively, from 2003 to 2004.
The report also noted:
- As of mid-January 2005 there is already $484.2 million in pending cooperative deals over $4 million, which is 46.5 percent of the total cooperative sales in all of 2004.
- The total sales of cooperatives over $4 million broke the $1 billion barrier in 2004, climbing 59.5 percent from 2003-04.
- There are very few “trophy” cooperatives left on the market, forcing high-end buyers into an already crowded townhouse market.
- The 2004 townhouse market outperformed all other sectors with a total sales increase of 118.7 percent between 2003-04, with the highest sale being Woody Allen’s townhouse for $24.5 million.
- The 2004 condominium market was also robust with developers offering buyers buildings designed by world-class architects including Richard Meier and Cesar Pelli. As this trend defined the 2004 condo market, the hotel conversion trend will define the 2005 condo market with examples like the Plaza Hotel, the St. Regis and the Intercontinental.
- The downtown loft market saw record prices for raw space sometimes topping $2,200 per square foot, as was the case with the sale of Martha Stewart’s penthouse at 143-146 Perry Street.
- Downtown townhouse sales account of almost 29% of all townhouse sales over $4 million, with a West 11th Street property selling for $ 8.9 million.
- While the latter half of 2004 was slower than the first six months, the luxury market gained momentum at the end of the year and into 2005.
An overall positive economic outlook for 2005, strong Wall Street bonuses and continued low interest rates are all current positive market factors for 2005, the report noted. But the uncertainty in Iraq, the weak dollar and looming deficits will also undoubtedly influence the market, the company noted. “It would seem that increased interest rates are inevitable and this will have a significant, if mostly psychological, impact on the luxury market. Then again, that was predicted a year ago…. the market speaks for itself,” Henckels said.
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