The average New York City apartment sale price increased 0.2 percent in the second quarter compared to the first quarter, and was 3 percent higher than in second-quarter 2005, according to a market report by appraisal firm Mitchell, Maxwell & Jackson Inc. The average sale price reached $1.17 million in the second quarter.
Meanwhile, the company’s sales volume index dropped 1.5 percent in the second quarter compared to the first quarter, and dropped 9 percent below second-quarter 2005.
“The second-quarter numbers show a calm return to a more normal market,” said Jeffrey Jackson, co-founder and chief economist for Mitchell, Maxwell & Jackson Inc., in a statement. He also stated that inventory levels rose 6 percent from the first quarter and were up 68 percent from the previous year.
Building permits, which set a record at 8,493 in 2005, have slowed, Jackson also noted. Permits for the first five months of 2006 reached 3,170 — a 17 percent drop from the first five months of 2005. “As inventory numbers are now edging past absorption equilibrium, the question becomes, ‘Can an oversupply be postponed in time to avoid a major glut of inventory?’ And, ‘How will rising interest rates impact on demand?'”
Among the findings in the second-quarter report:
- Sales of $1 million-plus represented a record 40 percent of all transactions in the second quarter, compared with 30 percent in the previous quarter and 31 percent in second-quarter 2005. Meanwhile, the share of sales between $500,000 and $1 million dropped from 48 percent to 41 percent.
- In the downtown market, an increase in the supply of loft apartments resulted in a 17 percent drop in average sale price, to $1.48 million — the lowest in six quarters. The average sale price in midtown rose 6 percent to $1.05 million; the West Side was up 1 percent to $1.46 million; and the East Side dropped 3 percent to $1.12 million.
- The market share of condominiums grew to finish the second-quarter at 41 percent of all sales, the highest on record, up from 32 percent the previous quarter.
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