The combination of sustained new contract activity, declining inventory levels and price improvement has made 2012 (so far), the best year for Manhattan real estate since 2007.
The first 6 months of Manhattan residential real estate have been Red Hot, with March through May deals far exceeding previous sales volume in each of the same periods going back to 2007. Most of these deals are still pending or closed but not yet reported.
On a price per square foot basis, the second quarter price improvement was modest, ranging from 2% for all condos to 5% for new developments and 7% for luxury properties. These price increases, however, reflect prices of those transactions entered into in the 1st quarter. Since then, the market has expanded with a high level of activity, we expect 2nd quarter property prices to do much better. The higher sales levels and price improvement will soon populate brokerages’ third-quarter reports.
A consistent theme in Manhattan has been the shrinking of inventory available for sale. While quite evident over the last 9 months, this theme has really been a sustained trend of less units coming on the market for over 3 years now with no end in sight.
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