Manhattan Real Estate: Ten Year Market Report

Yesterday’s Ten Year Manhattan Market report from Prudential Douglas Elliman in conjunction with Miller Samuel is a breath of fresh air. Not to be insensitive but it frames the housing conversation and begs me to shout out to as many people that will listen, “Quit your whining!”

Housing prices have doubled with an average price per square foot rising 105.6% from 2000. That’s a huge increase! Yes, there was a 14% year over year decline from the record levels of 2008 but that means anyone who bought in 2000 has seen 105% increase! The thousands who bought in 2007 and 2008 made an investment and lost a lot of money. That has a real impact on lives and families and that’s terrible. For everyone else, as in the majority home-owners in Manhattan, the New York market has been very good. Anyone who invested in Manhattan housing has enjoyed significant appreciation over the past ten years.

Manhattan has been and continues to be one of the strongest housing markets in the country for one fundamental reason: Manhattan is a very small island (limited supply) and living in the burbs sucks (increased demand). That basic fact still exists in 2010. As new buyers continue to invest in NYC in 2010 they will enjoy stabilizing prices, listing inventory and a pace of sales consistent with the decade average.

Manhattan Real Estate Key Statistics:

• Manhattan housing prices have DOUBLED over the past decade. Price per square foot INCREASED 105.6% to $1,073 from $522 in 2000.
• There were 7,430 sales in 2009, 27.9% fewer than were sold in 2008. However, the release of pent-up demand from the first half of 2009 cased the second half to see a SURGE IN SALES ACTIVITY. The annualized pace of sales in the second half of 2009 was 9,400 UNITS, higher than the 9,178 AVERAGE ANNUAL NUMBER OF SALES over the last decade.
• The 2009 inventory level was in line with the 6,860 AVERAGE ANNUAL INVENTORY LEVEL since 2000.
• Over the past decade, the Manhattan condo market has surpassed the co-op market in sales, beginning with a 40% MARKET SHARE and ending with a 54% MARKET SHARE. The gain was primarily due to the addition of new development sales to the housing stock.
• After setting records in 2008, all three PRICE INDICATORS DECLINED in 2009. This is the first time that any of the three price indicators have posted year-over-year declines since 1996. The 2009 media sales price of a Manhattan apartment was $850,000, down 11% from the record set in 2008 at $955,000.

Visit the Douglas Elliman Market Report page for access to all of the reports.

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