Will Dwindling Supply Shoot Manhattan Apartment Prices Up?
In the first eleven months of 2010, New York City issued just 10 building permits for new residential buildings, which will result in 505 new apartments.
Compared to 2008, that’s a drop of 95% and a discrepancy of nearly 9,000 apartments.
Some say that this dry spell in building, which Manhattan hasn’t seen the likeness of in more than 15 years, is a harbinger of increasing real estate prices.
Carnegie 57
Carnegie 57 and other buildings whose permits were pulled in the boom years have yet to come on the market, so the impact isn’t expected to be imminent. Yet after these buildings are completed in 2011 and 2012, there will be virtually no new builds following in their footsteps. Gary Barnett, president of Extell Development, the constructor of Carnegie 57, commented, “The number of building permits didn’t go from 10,000 to 6,000, it went from 10,000 to nothing.”
So if you’re one of those people who demands the newest of everything, you may see your selection of real estate decrease and prices increase in the next year or so. According to streeteasy.com, prices for new developments peaked in 2009 at a median of $1.215 million and dropped 13% in 2010. That’s a couple hundred thousand you could put towards new furniture for your new condo or a new car for your new garage.
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