This is what they call a seller’s market. Crain’s New York took a look at sales of luxury condos in Manhattan on StreetEasy.com and found that overall inventory for condos over $5 million is at its lowest level since 2007. Realtors in Manhattan suspect that international buyers looking for stable investments, and prospective condo-owners aggressively pursuing prices still affected by the once-troubled New York real estate market, are responsible for the increased demand. But as the demand rises the available condos for sale in Manhattan are dropping. Last October there were 832 available listings of condos priced at $5 million or more. That’s the lowest October number since the market peaked in 2007 and StreetEasy was posting only 588 listings.
The result of this is that buyers looking for luxury condos are having trouble finding any, and if they do, they’re paying more for them. The median price for condos in the top 10% of price range during the third quarter of 2011 was $4.17 million. This is the highest number since the peak, which came during the first quarter of 2008. Back then the median price for luxury condos was $4.99 million. Likewise 12 houses priced at $20 million or more were sold last quarter, the highest since the third quarter in 2008, when 20 were sold.
Realtors attribute the psychology of the demand increase to a sort of copycat effect, where buyers see the market in play and become more eager to pull the trigger on purchases they may only have been considering before. But for buyers looking for Manhattan real estate, there are a few ways to keep somewhat insulated from rising prices. Pre-sales in buildings that have yet to open are a good place to look, because building owners are eager to sell as many condos as possible quickly. Smaller neighborhoods in more remote locations in places like the Upper East Side, or East Harlem, where luxury condos to rival any in Manhattan are beginning to crop up, are another good bet. Interested buyers should look for more esoteric buildings. For as long as prices are high, the more secretive the location, the better.