2018 ended with a 5.5% decrease over 2017 in the number of contracts signed at $4 million and above in Manhattan. Year-to-date, 1,108 contracts were signed, totaling $9,077,371,226. The decline in contracts signed was attributed to weakness in the 1st quarter (-15%) and 4th quarter (-14%) over the same quarters in 2017. In the end, the 2018 luxury market was saved by a strong 2nd quarter and a slight uptick in the 3rd quarter. The 4th quarter saw only 247 contracts signed--averaging less than the benchmark 20 contracts signed per week. However, by other metrics--dollar volume, average price, and median price--it was the worst 4th quarter since 2012, the year before the new development boom of 2013 to 2015 started to attract a surge of buyers purchasing units off of floorplans. It's interesting to note that this year's dismal 4th quarter coincides with the worst December in the stock market since 1931, when the Great Depression kicked into high gear.
Other notable trends: The condo market recorded a 10% decline in the number of contracts signed. The average condo asking price was the highest we have seen--$8,211,488--translating to $2,932/sq.ft.. Those numbers were above the golden years, 2013-2015, when the condo market's average asking price was below $2,800/sq.ft.
One bright spot was the townhouse market, which posted a 19% increase in contracts signed - 119 houses in 2018 compared to 100 houses in 2017. The market responded to an average 5% drop in $/square foot asking price ($1,797/sq.ft.).
Drilling down through the numbers, a couple of things stand out: The length of time on the market stretched to 447 days, up from 433 days in 2017 and 318 days in 2016. This worrisome trend reflected an overpriced market in which a typical property dropped its asking price by 9% before it found a buyer. The market showed clear signs of strong buyers' resistance, prompting an ongoing price correction set against the backdrop of a volatile stock market and a change in the tax law that capped state, local, and real estate tax deductions at a total of $10,000. In addition, buyers could only deduct interest on new mortgages below $750,000.
Happy Holidays to all, and to all a healthy and peaceful 2019.
CLICK HERE To View the Olshan Luxury Report for the week of December 17-23, 2018.
Contracts Signed $4 M and above | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 |
# of Co-op Contracts $4 million and above | 288 | 282 | 296 | 222 | 252 | 251 |
# of Condo Contracts $4 million and above | 905 | 891 | 904 | 751 | 810 | 728 |
# of Condop Contracts at $4 million and above | 49 | 14 | 14 | 17 | 10 | 10 |
Total # of Contracts Signed on Apartments | 1242 | 1187 | 1214 | 990 | 1072 | 989 |
# of Townhouse Contracts $4 million and above | 130 | 153 | 130 | 112 | 100 | 119 |
Total # of Contracts Signed Apartments + Houses | 1372 | 1340 | 1344 | 1102 | 1172 | 1108 |
# of Contracts Purchased from Sponsors/New Development | 475 | 481 | 456 | 435 | 440 | 426 |
# of Contracts Signed Asking $10 million and above | 252 | 270 | 227 | 215 | 200 | 207 |
Total Volume | $10,854,826,824 | $11,256,284,299 | $10,738,479,892 | $8,937,866,862 | $9,104,329,032 | $9,077,371,226 |
Average Asking Price | $7,851,594 | $8,140,776 | $7,940,624 | $8,090,463 | $7,761,413 | $8,180,303 |
Median Asking Price | $6,366,072 | $6,440,048.00 | $6,289,375 | $6,367,820 | $6,149,606 | $6,289,038 |
Average Price Decline Before a Signed Contract | 3% | 4% | 5% | 6% | 8% | 9% |
Days on Market | 172 | 181 | 243 | 318 | 433 | 447 |
Condo Average Asking Price | $7,719,542 | $7,832,105 | $7,739,656 | $8,099,463 | $7,868,236 | $8,211,488 |
Condo Average Asking $/sq.ft. | $2,766 | $2,783 | $2,825 | $2,929 | $2,874 | $2,932 |
Condo Average Size | 2,814 | 2,801 | 2,731 | 2,755 | 2,725 | 2,797 |
Co-op Average Asking Price | $6,756,788.00 | $7,727,973 | $7,280,086 | $7,063,249 | $6,665,210 | $7,356,186 |
Townhouse Average Asking Price | $9,514,252 | $10,256,784 | $10,993,444 | $10,400,788 | $9,559,078 | $10,012,419 |
Townhouse Average Asking $/sq.ft. | $1,750.00 | $1,829.00 | $2,077.00 | $1,944 | $1,897 | $1,797 |
Townhouse Average Size | 5,553 | 5,621 | 5,288 | 5,531 | 5,208 | 5,638 |
East | West | Midtown | Downtown | Asking $/sq.ft. | Totals | |
---|---|---|---|---|---|---|
2018 Apartments |
216 | 219 | 115 | 439 | Avg. Co-op Ask: $7,356,186 Avg. Condo Ask: $8,211,488 Avg. Condo Ask: $2,932/sq.ft. Avg. Condo Size: 2,797/sq.ft |
989 |
2017 Apartments |
252 | 178 | 132 | 510 | Avg. Co-op Ask: $6,665,210 Avg. Condo Ask: $7,868,236 Avg. Condo Ask: $2,874/sq.ft. Avg. Condo Size: 2,725/sq.ft |
1,072 |
2016 Apartments |
195 | 161 | 138 | 496 | Avg. Co-op Ask: $7,063,249 Avg. Condo Ask: $8,099,463 Avg. Condo Ask: $2,929/sq.ft Avg. Condo Size: 2,755/sq.ft |
990 |
2018 Townhouses |
35 | 25 | 9 | 50 | Avg. Townhouse Ask: $10,012,419 Avg. Townhouse Ask: $1,797/sq.ft. Avg. Townhouse Size: 5,638 sq.ft. |
119 |
2017 Townhouses |
29 | 28 | 11 | 32 | Avg. Townhouse Ask: $9,559,078 Avg. Townhouse Ask: $1,897/sq.ft. Avg. Townhouse Size: 5,208 sq.ft. |
100 |
2016 Townhouses |
32 | 32 | 5 | 43 | Avg. Townhouse Ask: $10,400,788 Avg. Townhouse Ask: $1,944/sq.ft Avg. Townhouse Size: 5, 531/sq.ft |
112 |
Donna Olshan President dso@olshan.com |
Emily Chen Private Wealth Real Estate Services Chief of Research ecc@olshan.com |