Luxurious high-rise apartments can be found across Central Park South, near Columbus Circle in the Manhattan borough of New York.
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Manhattan’s residential real estate sales peaked at $ 7 billion in the first quarter, marking the strongest start of the year as the market showed no signs of slowing, according to new sales data.
According to a report by Miller Samuel and Douglas Eliman, the first quarter had 3,585 sales, the highest number for the first quarter. This is 46% more than in the first quarter of 2021. Total sales rose 60% to over $ 7.3 billion, as prices continued to decline as inventories dwindled.
The average price of a Manhattan apartment jumped 19% year-over-year to 0 2,042,113.
Strength has come despite concerns about rising interest rates, a possible recession and falling stocks, which have had a major impact on Manhattan’s real-estate market due to the city’s reliance on the financial industry.
The push to return to work does not seem to be leading to growth. About 36% of New Yorkers are back in office, according to Castell Systems.
Jonathan Miller, CEO of assessment and research firm Miller Samuel, says the idea that people live in Manhattan because of their jobs is now being challenged.
“You have a lot of people who are working from a distance, but want to stay in Manhattan,” he said. “They’re attracted to cultural offerings, restaurants, Broadway. Remote work doesn’t just mean the suburbs. Many people can work from a distance on the Upper East Side of Manhattan like Westchester.”
Rising interest rates also have less of an impact on wealthy buyers, who dominate the Manhattan market. As the rate increases they simply pay more cash. More than 47% of all real-estate purchases in the quarter were all-cash, down from the epidemic low of 39%, and close to historical norms.
Another reason for Manhattan’s strength in early 2022 was supply. While the rest of the country has struggled with a shortage of homes for sale, Manhattan still has a substantial inventory, although it is declining. According to Corcoran, about 5,000 inventories hit the market quarterly, the most in the first quarter on record. Yet for the first time in five years, inventory fell below 6,000 units.
Pamela Liebman, President and CEO of Corcoran, said: “With strong sales and price improvements, this great first quarter should be very optimistic about another important year ahead of us, without any unexpected shocks.”
The question is how much the price of Manhattan can go up before buyers start falling behind on deals. The average price of an apartment in Manhattan hit an all-time record of $ 1,190,000 in the first quarter. The average value for new developments tops 2.3 million.
The biggest price gains are at the top. Prices for four- or more-bedroom apartments rose 31% to $ 6.5 million last year. As buyers raise prices, according to Corcoran, only 20% of apartments sold are less than $ 1,200 per square foot, the lowest percentage on record.