Luxury Manhattan Real Estate Could Fall Another 50% - Barron's Even Barron’s, which forecast in November a New York real estate decline, seems surprised by the velocity of NYC’s luxury market crash. Sales were down 40% while prices declined 20% in Q408. Look out, says Barron’s Leslie P. Norton: High end NYC apartments and townhouses could fall by another 30%-50% and recovery will be protracted.
Two years into a nationwide downturn, NY is just starting to feel housing pain. Yet feel it it is as the city faces a perfect storm of harder-to-get “super-jumbo” ($650K+) loans, higher down payment and credit score requirements, disappearing Wall St. jobs and a glut of condo conversions. Purported housing bubble inflators such as foreign buyers and hedge fund managers have retreated. Even the merely affluent are feeling stock market shock.
The average Manhattan apartment still costs $1.6 million, while top apartments are going for as high as $65-80 million. Yet high-end inventory rose 65% in Q408 even as ultra luxe residential projects like the refurbished Plaza Hotel cut prices. Condo conversions city-wide are barely selling.
Manhattan 'burbs offered no shelter:
Greenwich, Conn. and Westchester, NY, for example, saw a 30%+ drop in sales......
....Nick Gogerty figures out that a reversion to the mean could cause Manhattan real estate prices to decline by 60% within 12-18 months.
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