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Manhattan Apartment Prices Drop as Lehman Effect Hits Home July 2, 2009

Posted by John Watch in News Feed.
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Manhattan Apartment Prices Drop as Lehman Effect Hits Home | Bloomberg.com

This Bloomberg.com article explains the price delcine of Manhattan homes since the housing boom. In various reports released today, Manhattan median prices dropped between 13 and 19 percent.

So what does this mean?

From a general standpoint, it shows that Manhattan – like most, if not all other markets in the country – is suffering from a decline in price values. This can be easily seen with public records. What these reports do not dig deeper to find, is exactly what markets are being the most hit. Condos? Co-Ops? Properties over $1 million? With these reports, YOU have to interpret the trends and determine the conclusions. Why should that be? Here are a few questions to ask:

Quote: The price of studio apartments declined 16 percent from a year ago to a median of $405,000, according to Miller Samuel. One-bedrooms dropped 17 percent to $650,000 and two-bedrooms fell 23 percent to $1.27 million. Three-bedroom units fell 37 percent to $2.35 million and four-bedrooms plummeted 47 percent to a median of $3.92 million.

Question(s): It’s safe to say that the average buyer is NOT in the market looking for anything remotely close to $1 million. Unless asking prices gravitate more toward actual sales, properties will sit and wait. The declining values is a natural reaction to overpriced ones. Also, what is the price per square foot of these types of properties?

Quote: About 32 percent of second-quarter listings included discounts from the original asking price, according to StreetEasy.com, a Web site that gathers Manhattan property listings from brokers. The deepest concessions were on Central Park South and in the Financial District, where list prices were pared by an average of 10 percent.

Question: (From Streeteasy Website, regarding Manhattan Condo Listings) “Medians for listings from past 60 days from StreetEasy data. Excludes some extraordinary properties. No representation is made as to the accuracy of this data.” …Really?

Looking at things from a median sale price is just that, the median. In this diverse housing market, with different properties, seasonal upticks and sizes, analyzing the property data on a price per square foot basis makes the market less scary, and more factual. 

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1. antonia - July 8, 2009

great insite! information shows you have done your homework!

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