Manhattan luxury real estate prices fell between 17 and 29% in the second quarter of 2009. The luxury segment is defined as the top 10% of the market by price and saw bigger falls in value than the total market. The overall market saw falls of between 13 and 19% from last year’s prices and sales volumes are at 50% of 2008.
For once, everyone is in agreement – prices fell dramatically, and sales volumes are well down compared to 2008. According to Reuters, “Tougher mortgage requirements, rising unemployment and the recession took its toll on the market that had for more than three years had been the notable exception to the U.S. housing market crash. But the Manhattan market dropped precipitously as Wall Street and the rest of the New York’s private industries shed jobs.” Reuters
The New York Times says, “The number of closings fell more than 50 percent, and prices in some categories were reported down as much as 25 percent, compared with the same quarter in 2008. Sale prices were also down from those reported in the first quarter of 2009.” The NY Times
Perhaps the most shocking figures are those applied to new condominium sales – down 61.7%, and although most analysts expected a disastrous second quarter, it looks as though there is more on the way. The death of the “jumbo loan,” means mortgage companies are requiring deposits in the region of 30-40% of the value of the property, and even with a 24% drop, median prices for Manhattan apartments are still around $1.15 million.
