It's a function of the way that statistics dribble out over the course of months that it wasn't so very long ago that we were writing about how, despite a bump in sales, second-quarter prices on NYC condos were flat year-over-year. It was fairly surprising, given that more sales and a limited supply of Manhattan apartments would indicate -- even to those, like your blogger, whose economic expertise is limited to auction-style fantasy baseball drafts -- that prices should rise. Supply and demand and elasticity and all that. But the last few years in Manhattan real estate have challenged just about every previously held belief most market-watchers have, and there the numbers were, tracking right alongside 2009's. The second quarter numbers, that is. With the arrival of the third quarter stats, it looks like things in the NYC condominium market have straightened themselves out. Which means that, belatedly, prices on Manhattan apartment listings did indeed climb in the last quarter, both over the second quarter and over the third quarter of 2009. Good news for fundamental economic rules, not-as-good news for Manhattan condo buyers, right? As usual, it's a little more complicated than that.
Of course, the economics of why NYC condo prices have bumped up are easy to understand -- they're the ones we sketched out above. "An uptick in sales activity and a relatively slow rate of new inventory helped drive Manhattan home prices upward in the third quarter, according to market reports released by several of the city's major residential firms," is how The Real Deal's Amy Tennery puts it. The increases themselves are hardly rounding errors, either -- apartment prices jumped up 12% over the second quarter, and were 14% higher than they were during the third quarter of 2009. "A relative dearth of new building permit filings in recent months could help keep Manhattan inventory low in the future," Tennery writes, which bodes well for further price hikes in the future. So, ready for your silver lining?
Um, so are we. While general uncertainty in the Manhattan real estate market -- which is not totally disconnected from the generally uncertain broader national economy -- should keep prices from rising too far too fast, it seems that the credit uncertainties that made for something of a buyer's market in recent years are beginning to dissipate. Which is nice for those of us who were worried about all those nervous lenders, but something of a bummer for those of us who enjoyed the unexpectedly low prices on Manhattan luxury condominiums. There are still deals out there, of course, all over the city, on all kinds of Manhattan condominium listings. But given that the most basic rules of economics do apparently still apply in NYC real estate, it seems increasingly smart to act on those deals while they're still there to be had. Browse accordingly.