In an abrupt about-face, Manhattan luxury real estate, always thought to be immune to the current housing slump, is showing signs of weakness. The latest figures for the second quarter (traditionally the hot spot of the year) show large drops in both volumes and prices

Manhattan Luxury Property

According to the Corcoran Group, one of Manhattan’s largest realtors, sales slumped 38% to a five-year-low. In an interview with the FT, Pamela Liebman, Corcoran’s chief exec, said:

Two years ago, you could throw up some brick, put in a kitchen and a bath, put a price on it, and you’d have a bidding war. That’s not the case any more. Buyers now feel that a property they want today could cost less tomorrow.

City records for this period indicate that apartments in prime Manhattan neighborhoods are selling for less than their purchase prices — a situation that seemed all but impossible just a year ago.

The New York Sun has compiled a long list of properties that have recently sold for less than the original purchase price, including: a unit at 80 John St., in the financial district, which sold for $590,000, much lower than the $720,000 selling price in January. An apartment on 515 West End Ave., on the Upper West Side, sold for $2.1 million — $50,000 less than its 2005 purchase price. Even TriBeCa, “the wealthiest ZIP code in America,” is not immune. A three-bedroom condominium at 166 Duane St. is on the market for $4.495 million, well below the $4.7 million paid as recently as April.

Much like the city of London, which has also seen the first price drop in London luxury real estate in five years, the Manhattan luxury real estate market is fueled by bonuses from Wall street, which look like being a little thin on the ground this year.

As usual, the analysts are make a big fuss over rising median prices, which means the only stock moving is the very high end. Sooner or later, sellers needed to be realistic about prices asked, and this seems to be happening now.

Corcoran Group Q2 report (PDF download)
The Financial Times
The New York Sun

Boredom – It’s a realtor’s worst enemy.

This video reminds me of the classic Larson cartoon, “When vegetables go bad.”

I can’t decide if this video should be classed as a “worst youtube real estate video,” or not. I think it’s so bad it’s good.

Either way, this is biblegirl7’s video shot at an open house. I assume she is attempting to sell the property, and at least she’s honest – “Someone needs to buy this house because I need the money. I need a new pair of boots." I am just glad it’s only 3 minutes long. I am not sure I could have stood any more without reaching into the monitor.