35% Surge In Sales Smashes New York Apartment Prices To Record High

“We’re seeing basic Econ 101 coming into play,” says one New York realtor, “when you have this much demand and so little inventory, prices will have to rise. And they have.” And, as Bloomberg reports, that is definitely the case as Manhattan apartment sales surged 35% in the busiest start to a year since 2007, setting price records with the average price per square foot rose 24% to $1,363, the highest in 25 years of record-keeping. As a large broker noted, “we’re finally at a point where you’re seeing the chronic lack of supply push prices higher,” adding “the market really isn’t fun for the buyer.” But that freshly printed money from the world’s central banks to the world’s oligarchs has to go somewhere…

Bloomberg reports,

Sales of co-ops and condominiums in the first quarter jumped 35 percent from a year earlier to 3,307, according to a report today from appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. The median price climbed 19 percent to $972,428, while the the average price per square foot rose 24 percent to $1,363, the highest in 25 years of record-keeping.

Price gains are accelerating in a market where the inventory of homes for sale plummeted to record lows three times in the past year as buyer demand increased.

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About 50 percent of deals in the quarter were completed with cash, Miller estimated.

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“There’s been a real escalation in prices,” he said. “We knew it was going to come and now we’re starting to see it. The biggest question is why it took this long.”

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On the Upper West Side, the increase in average prices ranged from 10 percent for two-bedroom apartments to 24 percent for one-bedroom units, according to the Brown Harris and Halstead report.

“I have buyers who need to finance, and unfortunately they find themselves losing out a lot to cash deals on a regular basis,” said Scott Harris, a broker with Brown Harris Stevens who handled the Wolfs’ co-op sale.