After a slight drop in prices at the beginning of the year, the Manhattan real estate market has stabilized in the last three months, with prices rising slightly and sales volume increasing with an expected spring surge in home buying.
Today’s second-quarter sales reports released by the city’s largest brokerage firms show that the increase in the average sale price was largely attributable to more robust sales of larger and more expensive apartments, while studio and one-bedroom sales lagged slightly.
Still, with question marks on employment and the limited availability of credit to homebuyers, there were few predictions of a major upturn in the Manhattan market.
The big sore spot in the market was the median sales price of new developments, which plunged 15.7 percent from last quarter and 19 percent from the year before, to $1.13 million.
Appraisal executive Jonathan Miller said the result was consistent the average sale in a new development being approximately 15 percent smaller in physical size than previous quarters. Because the smaller units require buyers to borrow less and have price points that qualify for special loans, they dominated the market, according to Miller.
Not a strong trend, but buyers are plunking down deposits based only on floor plans in new buildings
When the real estate market was booming, buyers routinely signed contracts for apartments in yet-to-be-built buildings, making their decisions based on little more than an artist’s rendering and a miniature model of their new home.
That changed once the market crashed, the New York Times observes.
Off-site showrooms disappeared, and buyers became deeply skeptical about floor plans and fancy brochures. Developers realized that buyers would no longer buy a home without first running a hand along a kitchen counter and standing by a window to take in the views.
In recent months, though, (more…)