Why Manhattan condo prices keep rising in a slow market
“You look at what’s happening in a lot of the Sunbelt states, including Florida, and you had just an influx of demand, and prices went exponential,” he said. “We never really had that real burst up in terms of prices. In fact, only now are we starting to see record prices. We never saw the nuttiness that a lot of the southern markets, the suburban markets saw. So we’re starting to kind of come into our own.”
He said that slower build has coincided with a supply picture that keeps getting tighter rather than easing into the fall, when new listings would typically start showing up.
“The fall is when you usually start building supply. We’re still down, down 15% year over year still,” he said. “Behind the scenes, there’s a lot of stuff happening. You definitely have some battles here and there. But supply is still down. And when buyers compete, sellers tend to win. That’s sort of the mechanism that we’re seeing.”
Four very different markets
The borough-wide record obscures how differently prices are moving depending on the neighborhood. Resale condo prices per square foot are up 6.0% year over year on the Upper East Side so far in the third quarter, compared with 2.8% in Midtown, 2.0% Downtown and just 1.2% on the Upper West Side, according to UrbanDigs.
A client buying on the Upper East Side is facing a meaningfully different loan amount than the same borough-wide average would suggest. Walkup said assuming that it’s the same across the area is where deals can get into trouble.
