Ride the Storm: Navigating Through Unstable Periods / Katerina Rudko (Belka G...
Manhattan Fourth Quarter 2010 Real Estate Market Report
1. Manhattan
Market Overview 4Q 10
A Quarterly Survey of Manhattan Co-op and Condo Sales
Prepared by Miller Samuel Inc.
Appraisal and consulting services covering
the New York City metropolitan area
Seasonality returned to the Manhattan Market Matrix Current Qtr % Chg Prior Qtr % Chg Prior Year Qtr
Average Sales Price $1,482,650 -0.3% $1,487,472 14.4% $1,296,156
housing market Average Price per Square Foot $1,058 -3.4% $1,095 0.7% $1,051
Number of sales below last year’s end of Median Sales Price $845,000 -7.5% $914,000 4.3% $810,000
year surge There were 2,295 sales in the fourth New Development $1,060,738 -9.4% $1,170,988 -5.7% $1,125,000
quarter, 7.2% below 2,473 sales in the same period Re-Sale $800,000 -8.8% $877,200 7.4% $745,000
last year and 13.8% below the 2,661 sales of the Number of Sales 2,295 -13.8% 2,661 -7.2% 2,473
prior quarter. However, the comparison to the same Days on Market (from Last List Date) 125 0.1% 125 -38.8% 204
period last year is a comparison to a quarter that Listing Discount (from Last List Price) 8% 5.8% 12.8%
Listing Inventory 7,232 -11% 8,123 5.6% 6,851
represented the largest fourth quarter market
share of sales activity in more than 20 years. QUARTERLY AVERAGE SALES PRICE / MANHATTAN
QUARTERLY AVERAGE SALES PRICE / MANHATTAN
When comparing the 13.8% decline in sales from $2,000,000
$2,000,000
the third to fourth quarter, the change exceeded $1,800,000
$1,800,000
the 20-year 7.5% average decline. Fourth quarter $1,600,000
$1,600,000
listing inventory increased 5.6% to 7,232 from $1,400,000
$1,400,000
$1,200,000
$1,200,000
6,851 in the prior year quarter—the same quarter
$1,000,000
$1,000,000
that had the record surge in sales that worked off
$800,000
$800,000
excess inventory during that period. The fourth $600,000
$600,000
quarter inventory total was 11% below 8,123 in $400,000
$400,000 00 01 02 03 04 05 06 07 08 09 10
00 01 02 03 04 05 06 07 08 09 10
the prior quarter. The decline was greater than
NEW DEVELOPMENT MARKET SHARE MEDIAN SALES PRICE
NEW DEVELOPMENT MARKET SHARE MEDIAN SALES PRICE New Developement Re-sale
the 3.4% average decline over the past decade, New Developement Re-sale
$2,000,000
$2,000,000 50%
50%
suggesting the new year will begin with a modest
level of inventory entering into one of the seasonally $1,600,000
$1,600,000 Median Sales Price
40%
40%
Median Sales Price
highest sales periods of the year.
$1,200,000
$1,200,000 30%
30%
Price indicators above prior year quarter due
$800,000 20%
20%
to shift toward larger units The median sales $800,000
price of a Manhattan apartment was $845,000, up $400,000
$400,000 Market Share New Development (Units)
10%
10%
Market Share New Development (Units)
4.3% from $810,000 in the same period last year,
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 0%
0%
$0
but down 7.5% from $914,000 in the prior quarter. 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
Median sales price edged higher due to the shift AVERAGE PRICE PER SQ FT / CO OP Downtown East Side West Side Uptown
in the mix from last year’s higher concentration of market—gained 12% SQ FT / CO OP year over year Downtown activity.East Side
AVERAGE PRICE PER causing the sales The average decline over the Uptowntwo
West Side
past
$1,200
$1,200
smaller, entry-level sales. Market share of studio and price indicators to rise. Median sales price tends decades between these two periods was 2.5%. The
$1,000
$1,000
1-bedroom apartments lost 11% market share while to decline from the third to the fourth quarter, the direction this quarter was consistent, but lower than
$800
weakest quarter of the year in terms of prices and the current quarter over quarter decline of 7.5%.
$800
2-bedroom apartments—the largest segment of the
$600
$600
$400
$400
Visit our website to browse listings and learn more about market trends
$200
$200
2. 4Q 10 Manhattan Market overvieW Prudential douglas elliMan real estate
Co-op market
The other price indicators followed a similar pattern.
Average sales price jumped 14.4% to $1,482,650 Co-op sales accounted for 51.7% of all apartment
from $1,296,156 in the prior year quarter, but slipped sales in the quarter. The co-op absorption rate—the
0.3% from $1,487,472 in the prior quarter. Price per Listing inventory and number of number of months to sell all existing inventory at the
current pace of sales—is 9.3 months, faster than the
square foot edged 0.7% higher to $1,058 per square sales returned to seasonal patterns 10-year average of 10.6 months.
foot from $1,051 in the prior year quarter, but fell
Number of AVERAGE SALES PRICE / MANHATTAN
QUARTERLY
sales slipped and inventory
3.4% from $1,095 in the prior quarter. Price indicators rose from the same period
expanded from last years surge in sales
$2,000,000
QUARTERLY AVERAGE SALES PRICE / MANHATTAN a year ago as entry-level sales lost market
Days on market and listing discount fell There were 1,186 sales in the fourth quarter,
$1,800,000
$2,000,000 share The median sales price of a Manhattan co-
sharply from prior year The number of days 6.2% below the 1,264 sales of the 2009 year end
$1,600,000
$1,800,000 op apartment was $685,000 in the fourth quarter,
between the change in the list price, if any, and surge, which was caused by the release of pent-up
$1,400,000
$1,600,000
8.7% higher than $630,000 in the prior year
contract date—known as days on market—fell $1,200,000
demand from the lack of activity earlier in the year.
$1,400,000
$1,000,000 quarter. The fourth quarter result was 11.9% below
sharply to 125 days from a record 204 days in The fourth quarter number of sales were 10.2%
$1,200,000
$800,000
$1,000,000
the $777,500 spike in the prior quarter, caused
the same period last year. The current level was below the 1,320 sales seen in the prior quarter,
$600,000
$800,000 by the drop out of the entry-level segment and
unchanged from the prior quarter and consistent trending in the same direction but greater than the
$400,000
$600,000 surge in 2-bedroom07 market 08share. The other10 price
with the 126 days on market average of the past 15 00 01 02 03 04 05 06 09
5.5% average third to fourth quarter change of the
$400,000 indicators followed 07 similar patterns.09 The average
years. Similarly, the percentage difference between past decade. Listing inventory ended the 03
00 01 02
NEW DEVELOPMENT MARKET SHARE MEDIAN SALES PRICE 04
quarter at 05 06 08
New Developement Re-sale10
$2,000,000 % higher than the SHARE MEDIAN SALES
sales price was $1,200,589, 23.1% higher 50% than
the listing price at time of contract and the contract 3,687, DEVELOPMENT MARKET3,069 inventory level PRICE
NEW 20.1 New Developement Re-sale
the $975,049 average sales price of the prior 50% year
price—the listing discount—fell sharply to 8% from of$2,000,000year quarter that represented the lowest
the prior
$1,600,000 40%
Median Sales Price quarter and 4.1% below the $1,251,959 average
its 15 year high of 12.8% in the prior year quarter, level of inventory of the last 3 years and was caused
$1,600,000 sales price of the prior quarter. Price per square 40%
$1,200,000 Median Sales Price 30%
but increased 2.2% from 5.8% in the prior quarter. by the surge in demand at the end of 2009. Listing
$1,200,000 foot edged 0.8% higher to $928 from $921 in the 30%
For the past fifteen years the increase in listing inventory fell 9.3% from 4,065 in the third quarter
$800,000 20%
prior quarter, but fell 6.3% from $990 in the prior
discount between the third and fourth quarters has to 3,687 in the fourth quarter, slightly below with the
$800,000 20%
$400,000 quarter. Market Share New Development (Units)
10%
averaged 1.3% so the current increase appears third to fourth quarter decade average of 10.2%.
$400,000 10%
consistent with seasonal trends. $0 4Q 09 1Q 10 2Q 10
Market Share New Development (Units)
3Q 10 4Q 10 0%
Seasonality decided to stay a while Beginning $0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 0%
AVERAGE PRICE PER SQ FT / CO OP Downtown East Side West Side Uptown
in the third quarter, the distribution of sales by
$1,200
AVERAGE PRICE PER SQ FT / CO OP Downtown East Side West Side Uptown
number of bedrooms has returned to a pattern
$1,200
$1,000
more consistent with long-term trends. Emphasis
$1,000
$800
in 2009 was on the first time buyer and entry
level apartments as many consumers transitioned $800
$600
from renters to purchasers, enticed by newfound $600
$400
affordability caused by double digit price declines, $400
$200
a federal tax credit and historically low mortgage
$0
$200 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
rates. At the end of 2009 and the beginning of
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
2010, the luxury market re-appeared in the real LISTING DISCOUNT VS DAYS ON MARKET / CO OP
estate conversation as consumers took advantage 20%
LISTING DISCOUNT VS DAYS ON MARKET / CO OP 200
of some of the largest price discounts from the 20% 200
16% 175
market’s peak. By the third quarter and continuing
16% 175
through the fourth quarter, the middle of the housing 12% 150
Days On Market
market stopped underperforming relative to its 12%
8%
150
125
higher and lower counterparts. Looking forward, Days On Market
8% 125
4% 100
macro economic issues such as unemployment and Listing Discount
tight credit need to ease in order to see meaningful 4% Listing Discount 100
0% 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 75
improvement beyond the rebound experienced from 0% 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 75
2009 to 2010. AVERAGE PRICE PER SQ FT / CONDO Downtown East Side West Side Uptown
$2,500
AVERAGE PRICE PER SQ FT / CONDO Downtown East Side West Side Uptown
$2,500
CO-Op Market Matrix Current Qtr %$2,000
Chg Prior Qtr % Chg Prior Year Qtr CO-Op apartMent Mix % of Total Median Price
Average Sales Price $1,200,589 -4.1%
$2,000 $1,251,959 23.1% $975,049 Studio 14% $345,000
$1,500
Average Price per Square Foot $928 -6.3% $990 0.8% $921
Median Sales Price $685,000 $1,500
-11.9% $777,500 8.7% $630,000 1 bedroom 40% $568,000
$1,000
Number of Sales 1,186 -10.2%
$1,000
1,320 -6.2% 1,264 2 bedroom 31% $1,150,000
$500
Days on Market (from Last List Date) 118 11.3% 106 -21.9% 151
3 bedroom 10% $2,250,000
Listing Discount (from Last List Price) 5.8% $500 2.8% 18.3%
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
Listing Inventory 3,687 -9.3% 4,065 20.1% 3,069 4+ bedroom 3% $5,040,337
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
LISTING DISCOUNT VS DAYS ON MARKET / CONDO
15%
LISTING DISCOUNT VS DAYS ON MARKET / CONDO 300
15% 300
Visit our website
12% to browse listings and learn more about market trends 240
Days On Market
12% 240
9% 180
3. $400,000
$600,000 00 01 02 03 04 05 06 07 08 09 10
$400,000
NEW DEVELOPMENT MARKET SHARE MEDIAN SALES PRICE
00 01 02 03 04 05 06 07 08
New Developement 09 Re-sale10
$2,000,000 Prudential douglas elliMan real estate Manhattan Market overvieW
NEW DEVELOPMENT MARKET SHARE MEDIAN SALES PRICE New Developement Re-sale 50%
4Q 10
$2,000,000 50%
$1,600,000 40%
Median Sales Price
Condo market
$1,600,000 40%
$1,200,000 Median Sales Price 30%
either more optimism by sellers for 2011 or heavy
Listing discount and days on market declined
$1,200,000
$800,000
30%
20% contract activity at the end of the fourth quarter or
The average days on market for a Manhattan co-
$800,000
op $400,000 days, 33 days faster than 151 days in
was 118 Price indicators edged higher as
Market Share New Development (Units)
20%
10% a combination of both. The combination of falling
sales and falling listing inventory resulted in a 9.6
the$400,000 quarter,09 12 days slower than 106 2Q 10
prior $0
year 4Q
but 1Q 10
listing inventory slipped
Market Share New Development (Units)
3Q 10 4Q 10
10%
0%
month absorption rate, consistent with the 9.4
days in the prior quarter. This metric averaged 126 Number of sales declined from prior year
$0 0%
4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 month average absorption rate of the past decade.
days over the past decade. However, from the point Downtown
AVERAGE PRICE PER SQ FT / CO OP
quarter There Side
East West Side
were 1,109 sales in the fourth Uptown
Condo sales comprised 48.3% of all sales in the
$1,200
where the PRICE PER SQ FT / is originally listed, the Downtown
AVERAGE average property CO OP quarter, 8.3% below 1,209West Side in the prior year
East Side
sales Uptown
fourth quarter, higher than the 42.7% average of
average
$1,200 days on market was 197 days indicating
$1,000
quarter and 17.3% below 1,341 sales in the prior the past 20 years as condos have been added to
that sellers were waiting an average of 79 days or
$1,000
$800 quarter. Historically, the fourth quarter is the the housing stock through new development. To
more nearly three months before the property was
$800
$600 weakest in terms of sales activity averaging an illustrate the trend, the fourth quarter of 1990 had a
priced close enough to market value to receive an
$600
$400 8.4% drop from the third quarter over the past condo sales market share of 33.3%.
offer. This indicator expanded over the past year
$400
$200 decade. The 17.3% quarter over quarter decline Price indicators edged above prior year
from 183 days suggesting that seller optimism
$0
$200
exceeds the 10-year average, but is consistent quarter due to shift in sales mix The median
about the market09expanded faster 10
4Q 1Q than market 2Q 10 3Q 10 4Q 10
with the direction of the seasonal pattern. Listing sales price of a Manhattan condo in the fourth
conditions actually reflected. The 1Q 10 discount 2Q 10
$0 4Q 09 listing 3Q 10 4Q 10
LISTING DISCOUNT VS DAYS ON MARKET / CO OP inventory fell 6.3% to 3,545 from 3,782 in the prior quarter was $997,885, the first time this metric
fell sharply to 5.8% from a decade high of 18.3%
20% 200 has fallen below the $1,000,000 threshold in 2010,
in the prior year quarter, but edged higher than the year quarter and fell 12.6% from 4,058 in the prior
LISTING DISCOUNT VS DAYS ON MARKET / CO OP
20% quarter. Listing inventory has averaged a 2.6% 200 but still 0.3% higher than the $995,000 median
three year low of 2.8% in the prior quarter.
16% 175
decline in the third to fourth quarter transition as sales price in the prior year quarter. This metric is
16% 175
12% 150
some sellers opt to pull listings from the market that still 10.9% below $1,120,000 in the prior quarter.
Days On Market 150
12% There was a pronounced year over year shift in the
8% did not sell or delay their entry until the new 125
year.
Days On Market
8% The greater decline in 2010 than the decade125
long quarterly mix of size categories. Sales of entry-
4% Listing Discount 100
average, while consistent in direction, suggests level apartments—studio and 1-bedrooms—lost
4% Listing Discount 100
0% 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 75 12% market share as compared to the prior year
0% 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 75 quarter. The drop was more than offset by the 15%
AVERAGE PRICE PER SQ FT / CONDO Downtown East Side West Side Uptown
increase in market share of 2-bedroom apartments
$2,500
AVERAGE PRICE PER SQ FT / CONDO Downtown East Side West Side Uptown
sold. The larger units sold increased the aggregate
$2,500
$2,000 results, thereby characterizing the condo market
$2,000 as rising when it is currently seeing relatively
$1,500
stable pricing on an individual unit basis. The other
$1,500
$1,000 price indicators showed similar patterns. Price per
$1,000 square foot increased 0.9% to $1,198 in the fourth
$500
$500
quarter, from $1,187 in the prior year quarter and
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
essentially unchanged from $1,199 in the prior
$0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 quarter. Average sales price was $1,784,296 in the
LISTING DISCOUNT VS DAYS ON MARKET / CONDO
15%
LISTING DISCOUNT VS DAYS ON MARKET / CONDO 300 fourth quarter, 9.3% higher than $1,631,872 in the
15% 300 prior year quarter and 3.8% above $1,719,296 in
12% 240
Days On Market the prior quarter.
12% 240
180
9% Days On Market Days on market fell sharply The average days
9% 180
6% 120 on market for a Manhattan condo was 132 days,
6% 120 almost half the 259 days in the last quarter of 2009
3% 60
Listing Discount and 11 days faster than the 143 day average of the
3% 60
0
0% 4Q 09 Listing Discount
1Q 10 2Q 10 3Q 10 4Q 10 prior quarter. Listing discount increased to 10.4%
0% 0 from 7.1% in the prior year quarter and from 8.8%
4Q 09 1Q 10 2Q 10 3Q 10 4Q 10
in the prior quarter.
AVERAGE PRICE PER SQ FT / LUXURY AVERAGE PRICE PER SQ FT / LOFT
COndO Market Matrix / LUXURY Current Qtr
$2500
AVERAGE PRICE PER SQ FT % Chg
AVERAGE Prior Qtr SQ FT / LOFT Prior Year Qtr
$1,500 PRICE PER % Chg COndO apartMent Mix % of Total Median Price
Average Sales Price
$2200
$2500 $1,784,296 3.8%
$1,500 $1,719,296 9.3% $1,631,872 Studio 11% $460,000
$1,300
Average Price per Square Foot
$1900
$2200 $1,198 -0.1% $1,199 0.9% $1,187
$1,300
$1,100 $1,120,000 1 bedroom 27% $693,600
Median Sales Price $997,885 -10.9% 0.3% $995,000
$1600
$1900
Number of Sales 1,109 -17.3% $900
$1,100 1,341 -8.3% 1,209 2 bedroom 43% $1,315,000
$1600
$1300
Days on Market (from Last List Date) 132 -7.7% 143 -49.0% 259
$1000
$1300 4Q 09 $900
$700 3 bedroom 15% $2,900,000
Listing Discount (from Last List Price) 3Q 10
1Q 10 2Q 10 10.4%
4Q 10 4Q 098.8%1Q 10 2Q 10 3Q 10 7.1%
4Q 10
$1000 4Q 09
Listing Inventory 3,545 -12.6% $700 4,0581Q 10 -6.3% 10 3,782 4+ bedroom 4% $6,275,000
1Q 10 2Q 10 3Q 10 4Q 10 4Q 09 2Q 3Q 10 4Q 10
Visit our website to browse listings and learn more about market trends