What is fueling the luxury market in NYC?

[stephaniebetancourt]

It seems like every time I open up the Oshlan report we are setting a new record in luxury sales. The latest report says " 40 contracts were signed last week at $4m and above in Manhattan". I am curious to hear why this segment is on fire.

 

[Noah Rosenblatt]

It seems like every time I open up the Oshlan report we are setting a new record in luxury sales. The latest report says " 40 contracts were signed last week at $4m and above in Manhattan". I am curious to hear why this segment is on fire.

IMO, new dev and luxury are seeing a delayed recovery reaction to the broader markets. Also, inventory is down and rates are rising, this can fuel some buy side interest. Relative value as well versus other urban markets and risk assets

 

[David Goldsmith]

I think some of the reason is that in the past 2 years the top 0.1% have seen their wealth skyrocket and under ZIRP they are having trouble finding places to put their money so they are parking it in Real Estate. The high end collector car market is booming as well.

 

[Noah Rosenblatt]

I think some of the reason is that in the past 2 years the top 0.1% have seen their wealth skyrocket and under ZIRP they are having trouble finding places to put their money so they are parking it in Real Estate. The high end collector car market is booming as well.

definitely can not argue that after what risk assets have done

 

[inonada]

I think everything people said above is right:

1. Flush with investment and income gains, fueled by ZIRP.
2. Alternatives don't look attractive.
3. Cheap mortgages.
4. Rental inventory at high end got wiped out by returnees. People collectively tanked the rental market in 2020 when they left to test the waters elsewhere. Collectively, their return in 2021 boosted rents back up to pre-pandemic levels. More importantly, they sopped up all the inventory and then some, because compared to normal times, they were more likely to come back here and rent while they took their time to find something to buy. So not only do rents look expensive, but the inventory isn't even there like it used to be. On the buy side, OTOH, there is plenty of inventory due to over-building from the past decade.

 

[inonada]

It is also telling that while sales volume is up, inventory is plentiful and prices are typically down from their mid-2010's levels.

 

[David Goldsmith]

There are some notable exceptions like 443 Greenwich St and The Greenwich Lane, but I think in general - and notably during the most liquid market in history - many properties are still selling based on discounts and those which refuse to give them still are not selling.

 

[khuang]

I think some of the reason is that in the past 2 years the top 0.1% have seen their wealth skyrocket and under ZIRP they are having trouble finding places to put their money so they are parking it in Real Estate. The high end collector car market is booming as well.

Agreed. Asset price inflation begins with money printing and the Cantillon effect in action. In this low yield environment, top 0.1% search for capital preservation vehicles which translates to investments in scarce assets like Manhattan real estate, Malibu beach front property, high-end art, collectibles (sports cards (PSA10s), watches (Patek/Rolex), handbags (Birkin), wine (DRC), cars (vintage)), digital assets (BTC), etc. I think the demand in the Manhatan luxury market continues as we haven't even felt the demand surge in international buyers (ex. China given capital controls). One interesting observation is the sellout in the luxury new development "boutique" buildings, which are selling out so quickly (Bellemont, 109 East 79th St, 200 East 83rd St etc).

 

[Noah Rosenblatt]

Great thread. The big question on my mind is going forward and our markets "pricing in" something that is quickly changing: How is a rising rate + tight fed + decelerating growth + tighter margin future environment factoring in to all of this now that markets are resettingto future inflation + cb iterventions?

 

[David Goldsmith]

It's possible we could see a repeat of the early 1990s where high end properties didn't crash, they just stopped transacting, where the lowest end properties (where purchasers financed the most) took brutal hits.

 

[Noah Rosenblatt]

It's possible we could see a repeat of the early 1990s where high end properties didn't crash, they just stopped transacting, where the lowest end properties (where purchasers financed the most) took brutal hits.

Hmm, interesting thought. It's funny, cause fintwit is suggesting it is 1994 all over again

 

[David Goldsmith]

The dollar volume in luxury sales decreased year over year for Q1.

UES condo snatches top spot among Manhattan luxury contracts

Manhattan’s luxury contracts were led by PH17 at 109 East 79th Street, asking $29.35 million, closing out the market’s first quarter.

therealdeal.com

UES condo snatches top spot among Manhattan luxury contracts​

First 12 weeks of 2022 saw 394 contracts signed at $4M and above​

The first 12 weeks of 2022 were a mixed bag compared to the sky-high numbers in Manhattan’s luxury market the same time last year.
The first quarter saw 394 contracts signed at $4 million and above, outpacing last year’s first quarter record of 390 contracts. Still, during that same period, asking volume totaled $3 billion, dropping from $3.322 billion last year, partially thanks to a decline in trophy sales.

Seventy contracts priced at $10 million and above were signed, compared to 82 contracts during the same period in 2021, according to Olshan Realty.
The priciest unit to enter into contract last week was PH17 at 109 East 79th Street, asking $29.35 million. Spanning 6,548 square feet, the unit has five bedrooms and five and a half bathrooms, with 10-foot ceilings throughout. The living room has a fireplace and the formal dining room opens onto two terraces that total 336 square feet overlooking 79th Street.

The 20-story, 31-unit condo was designed by Steven Harris Architects and is expected to be completed later this year. Amenities in the building include an international-sized squash court that converts to a basketball court, a gym, golf simulator, game room and a spa treatment center.
Of the 31 units in the building, 24 have sold with asking prices averaging $4,067/sq.ft.

The second priciest home to enter into contract was a townhouse at 280 West 11th Street. The property asked nearly $19 million, slightly reduced from the $20 million it asked when it went on the market in September 2020.

The six-story house spans 7,921 square feet and has been divided into six apartments. The nearly 26-foot-wide property backs on Bleecker Gardens, a common garden shared by 13 neighboring houses.
Of the 33 contracts signed between March 21 and 27, asking prices totaled $267 million with a median asking price of $5.899 million. There was an average 5 percent discount from original ask to last asking price and units spent an average of 469 days on the market.
Twenty-one of the units entered into contract were condos and 10 were co-ops. The week also had two townhouses in the mix.

 

[Noah Rosenblatt]

The dollar volume in luxury sales decreased year over year for Q1.

UES condo snatches top spot among Manhattan luxury contracts

Manhattan’s luxury contracts were led by PH17 at 109 East 79th Street, asking $29.35 million, closing out the market’s first quarter.

therealdeal.com

UES condo snatches top spot among Manhattan luxury contracts​

First 12 weeks of 2022 saw 394 contracts signed at $4M and above​

The first 12 weeks of 2022 were a mixed bag compared to the sky-high numbers in Manhattan’s luxury market the same time last year.
The first quarter saw 394 contracts signed at $4 million and above, outpacing last year’s first quarter record of 390 contracts. Still, during that same period, asking volume totaled $3 billion, dropping from $3.322 billion last year, partially thanks to a decline in trophy sales.

Seventy contracts priced at $10 million and above were signed, compared to 82 contracts during the same period in 2021, according to Olshan Realty.
The priciest unit to enter into contract last week was PH17 at 109 East 79th Street, asking $29.35 million. Spanning 6,548 square feet, the unit has five bedrooms and five and a half bathrooms, with 10-foot ceilings throughout. The living room has a fireplace and the formal dining room opens onto two terraces that total 336 square feet overlooking 79th Street.

The 20-story, 31-unit condo was designed by Steven Harris Architects and is expected to be completed later this year. Amenities in the building include an international-sized squash court that converts to a basketball court, a gym, golf simulator, game room and a spa treatment center.
Of the 31 units in the building, 24 have sold with asking prices averaging $4,067/sq.ft.

The second priciest home to enter into contract was a townhouse at 280 West 11th Street. The property asked nearly $19 million, slightly reduced from the $20 million it asked when it went on the market in September 2020.

The six-story house spans 7,921 square feet and has been divided into six apartments. The nearly 26-foot-wide property backs on Bleecker Gardens, a common garden shared by 13 neighboring houses.
Of the 33 contracts signed between March 21 and 27, asking prices totaled $267 million with a median asking price of $5.899 million. There was an average 5 percent discount from original ask to last asking price and units spent an average of 469 days on the market.
Twenty-one of the units entered into contract were condos and 10 were co-ops. The week also had two townhouses in the mix.

 

[David Goldsmith]

Manhattan’s luxury market records slowest week since 2020

Buyers signed contracts for 13 Manhattan homes priced at $4 million or above in the first week of August, down nearly 50% from the prior week.

therealdeal.com

Manhattan’s luxury market records slowest week since 2020​

Buyers signed contracts for 13 homes asking a combined $95M, lowest weekly total in nearly 2 years​

A sweltering heat wave brought 90-degree temperatures to New York City last week, but Manhattan’s luxury market continued to cool off.
Buyers signed just 13 contracts for homes asking $4 million or more in the borough in the first week of August, 11 fewer than in the last week of July, according to Olshan Realty’s latest report. Those 13 properties were last asking a combined $95.24 million, the lowest total tracked by the report since October 2020.
The priciest home was a duplex condo at 565 Broome Street, the 115-unit, Renzo Piano-designed Soho tower developed by Bizzi & Partners, Aronov Development and Halpern Real Estate Ventures in 2016. The unit was last asking $14.95 million, up from $13.5 million when the sponsor unit first hit the market.
The 3,000-square-foot, three-bedroom apartment comes with a 2,000-square-foot terrace, featuring a 25-foot saltwater pool and an outdoor shower.

The second-priciest home to find a buyer was a full-floor unit at Cary Tamarkin’s 47 East 91st Street in Carnegie Hill. The 4,000-square-foot condo was last asking $11.5 million, reduced slightly from $11.9 million when it hit the market in April. It comes with five bedrooms, a library and a great room with a fireplace. Its owner paid $8.4 million for the unit in January 2005.
Out of the 13 contracts signed last week, ten were for condos, two were co-ops and one was for a townhouse. The median asking price was $6 million, and the units spent an average of 540 days on the market, with an average discount of 2 percent.

 

[David Goldsmith]

Manhattan luxury market sees almost 60% contract volume drop from first 2 weeks of 2021.

Manhattan luxe sees 28 contracts signed in first half of August

A quadruplex condo at 95 Charles Street topped Manhattan’s luxury market, beating Unit 4/5A at 895 Park Avenue by $2 million.

therealdeal.com

 

[David Goldsmith]

Heatstroke: Manhattan luxury market struggles to sign contracts

Manhattan’s luxury market had an abysmal week last week, securing just eight contracts signed at $4 million and above.

therealdeal.com

Heatstroke: Manhattan luxury market struggles to sign contracts​

Just 8 contracts signed last week at $4M and above​

Manhattan’s luxury market hit a summer slump last week, with just eight contracts signed at $4 million and above.
That’s the worst performance in the luxury market since the week of Aug. 3, 2020, when just six contracts were signed, according to a weekly report by Olshan Realty. The report also marks the second time in recent weeks the market hit a slump reminiscent of 2020.

The 13 signed contracts reported in the first week of August were last asking a combined $95.24 million, the lowest total tracked by the report since October 2020. For comparison, the 10-year average of contracts signed in the third week of August is 17.

Even those that did enter into contract were not as pricey as previous weeks, where asking prices can go above $20 million.
The priciest home to enter into contract was 17/18A at 100 Eleventh Avenue, asking nearly $15 million. The duplex condo has over 8,000 square feet across four bedrooms, five bathrooms and two powder rooms.

The seller bought the unit from the sponsor in December 2009 for $19.4 million and it was listed in November.
The unit has 11-foot ceilings and views of the Hudson River. It is located in the curved building designed by Pritzker-prize winning architect Jean Nouvel, known for its facade that consists of 1,650 different-sized panes of glass.

The second priciest home to enter into contract was 10B at the Rudin Family and Global Holdings’ 155 West 11th Street, asking $10.5 million. The condo has over 2,000 square feet, including three bedrooms and three and a half bathrooms. The living room opens onto a 24-foot-wide terrace with city views to the east and south.

The apartment is in the Greenwich Lane, a five-building complex comprising 193 condos and five townhouses. The seller bought the unit off of floorplans in 2014 and closed in November 2016 for over $8 million.
Out of the eight contracts signed last week, five were for condos and three were for townhouses. The median asking price was $6.7 million, and the units spent an average of 457 days on the market, with an average discount of 6 percent.

 

[David Goldsmith]

Manhattan luxury market bounces back with 21 contracts

After sluggish weeks, the luxury market bounced back last week, securing 21 contracts signed at $4 million and above in Manhattan.

therealdeal.com

Manhattan luxury market bounces back with 21 contracts​

A sign that the summer slump may be ending​

After sluggish weeks, the luxury market is bouncing back in Manhattan.
Last week, 21 contracts were signed at $4 million and above.

That’s 13 more than the eight signed the previous week, according to Olshan Realty’s weekly report. Those eight contracts represent the lowest totals since the week of Aug. 3 2020. Last week’s rebound was led by 17 condo sales. There were also two co-ops and two townhouses in the mix.
Aside from last week, it has been a slow August. The month started with a lackluster 13 contract signings during the first week.
Last week’s priciest home to enter into contract was a townhouse at 2 East 82nd Street, asking $25 million. The townhouse has been on and off the market since 2019, starting at $32 million. It is a six-story, 25-foot-wide, brick-and-limestone building, equipped with a commercial elevator. It is over 12,000 square feet.

Originally built as a single family home, the Marymount School used it as a middle school. It is in need of renovations.
The second priciest home to enter into contract was 26/27D at The Millennium Partners’ 1965 Broadway, asking $13.95 million. That’s reduced from the $14.95 million it was asking when it was listed in March 2021. The duplex condo has 4,800 square feet across five bedrooms, six bathrooms and two powder rooms. It also features a mahogany-paneled library and views of Central Park and the city. The two combined units were renovated in 2010.
The median asking price for all 21 of the units to enter into contract was nearly $6 million. The units spent an average of 558 days on the market, with an average discount of 9 percent.

 

[David Goldsmith]

Manhattan’s luxury market sales dip to 2022 low

Manhattan’s luxury market ticked up from its summer slump in recent weeks, but appeared to slow back down in early September.

therealdeal.com

Manhattan’s luxury market sales dip to 2022 low​

Weekly report notched 10 contracts signed at $4M+, year’s lowest sales volume​

After Manhattan’s luxury market appeared to be coming back to life in recent weeks, it appears to have slowed back down.
Just 10 contracts were signed last week at $4 million and above in Manhattan, half of the previous week’s total, according to a weekly report by Olshan Realty. The total is also below the 10-year average of 14 contracts signed in the week following Labor Day.

The total weekly asking price sales volume was just $61.2 million, the lowest of the year.

The market had previously appeared to tick back up after a late summer slump. The week ending Aug. 22 had just eight contracts signed, and buyers signed just 13 contracts the first week of August.

The priciest home to enter into contract was 4A at 177 Ninth Avenue, developed by the Brodsky Organization, asking $12.5 million. The unit has over 3,000 square feet spanning across four bedrooms and four and a half bathrooms, with views of gardens and the Theological Seminary. The unit is in a building called the Chelsea Enclave, a condop.

The seller paid nearly $10 million for the unit in July 2017 before commencing renovations and placing it on the market in July.
The second priciest home to enter into contract was 1504 at Related’s 515 West 18th Street, asking $9.6 million. That’s raised from $8.8 million when the building started marketing in the summer of 2020. The condo has 2,500 square feet across four bedrooms and four and a half bathrooms.

The building is known as the Lantern and was designed by Heatherwick Studio, which were the architects of the Vessel at Hudson Yards and Little Island.
Of the 10 contracts signed, seven were condos, one was a co-op, one was a condop and one was a townhouse. The median asking price was $4.8 million. The units spent an average of 635 days on the market, with an average discount of 5 percent.

 

[David Goldsmith]

I think most prognosticators were predicting that if there was a turn that it would affect luxury less and the lower end more.

At the top of the market, sales of luxury homes across the U.S. plummeted 28 percent in the three months ending Aug. 31 from the same period one year ago. That’s the biggest such decline in at least a decade — as long as Redfin has been tracking the data. Non-luxury home sales fell 19.5 percent in the same period, a slightly bigger drop than the 19 percent dip recorded when the coronavirus first locked down the U.S.

Luxury housing market took its biggest dive in 10 years

Redfin data on the luxury housing market show high-end home purchases fell a record 28 percent year-over-year from June to August.

therealdeal.com

Luxury housing market took its biggest dive in 10 years​

Purchases from June to August dropped record 28% YoY​

This summer’s luxury market couldn’t resist the shifting tides swaying homebuyers across the board, which landed the category in its biggest drop in recent memory.
From June to August, luxury home sales declined 28.1 percent year-over-year, the largest fall on record, according to a report from Redfin. The previous largest drop was nearly five percentage points fewer at the start of the pandemic; Redfin’s data stretches back to 2012.

The housing market is tumbling in general as mortgage rates rise and economic uncertainty roils financial decisions for many. But the drop is most visible in the luxury market, which fell 19.5 percent year-over-year in the same period, also a record for the category.
Redfin chief economist Daryl Fairweather cited the “sticker shock” felt by high-end homebuyers as mortgage rates rise, adding major money to monthly bills.

“Luxury goods are often the first thing to get cut when uncertain times force people to reexamine their finances,” Fairweather said in the report.
California is home to the biggest purchasing drops in the luxury market. In Oakland, high-end sales declined 63.9 percent year-over-year, worst among the 50 most populous metros. San Diego and San Jose also saw drops of more than 55 percent, as did Miami. New York was near the bottom of the spectrum, sporting an 11.8 percent drop.
While sales are declining, prices are still growing, though more moderately. The median sales price rose 10.5 percent year-over-year, topping out at more than $1.1 million. A year ago, the annual growth in sales price was 20.3 percent, revealing slowing price growth. Prices are rising slower in the luxury market than the non-luxury market.

The five top metros for price growth were all in Florida, led by a 39.3 percent surge in Tampa. West Palm Beach and Fort Lauderdale also ranked in the top five, while New York was again at the other end of things with a 4 percent rise, only slightly bigger than St. Louis’ 3.5 percent gain.
Supply in the luxury market, meanwhile, is recovering. Supply fell 1.9 percent year-over-year, but that’s much better than the record 25 percent annual drop from a year ago. There were roughly 169,000 homes for sale in the past three months, an increase from the record low of 121,000 for the three-month period ending in February.

Los Angeles saw the third-biggest drop in active listings, down 37.6 percent. A couple of Texas markets, San Antonio and Austin, ranked in the top five in active listing increases, seeing jumps of 28.1 percent and 23.6 percent, respectively.

 

[David Goldsmith]

https://www.olshan.com/marketreport.php?id=656

LUXURY MARKET REPORT 2022

Report on Contracts Signed
Manhattan Residential Properties $4 Million and Above
October 3-9, 2022

---

12 Contracts Signed

Twelve contracts were signed last week in Manhattan at $4 million and above, two fewer than the previous week. It was yet another lackluster performance, the 3rd week in a row of declining sales. The usual suspects are to blame—rising interest rates and a chaotic stock market. And once again, a mid-week Jewish holiday slowed the action.
The No. 1 contract was PH80 at 25 Columbus Circle, asking $49 million, reduced from $75 million when it was listed in July of 2019. The Wall Street Journal reported that the unit went to contract for $40 million. It has 8,274 square feet including 5 bedrooms and 6.5 bathrooms with spectacular views of Central Park and the Hudson River. A 42-foot living room is flanked by 2 fireplaces. The condo is being sold by Miami Dolphins owner Steve Ross, the chairman and founder of Related Companies, which developed the building as the Time Warner Center and completed it in 2003. Amenities include a 24-hour doorman, concierge services, valet parking/garage, landscaped terrace with river views, playroom, state-of-the-art fitness center, private screening room, pet terrace, and use of the Mandarin Oriental Hotel’s spa, swimming pool, and other services. Ross is moving to Related’s new building at 35 Hudson Yards.
The No. 2 contract was the 10th floor at 1228 Madison Avenue, asking $11.175 million. It has 3,841 square feet including 4 bedrooms and 5.5 bathrooms, plus a 184-square-foot terrace off the library. 1228 Madison Avenue is a new co-op building designed by architect Robert A.M. Stern with 15 units on 18 floors. It is a co-op with condo rules and has a 150-year land lease. Reliable sources have reported that the 10th floor and the 7th floor, which was the No.3 contract of the week, were sold to investors in the project. Amenities at 1228 Madison include a doorman, fitness center, storage and bike rooms.

---

TOTALS	3	3	1	5	.	12
.	EAST SIDE	WEST SIDE	MIDTOWN	DOWNTOWN	Asking $/sq.ft.	Totals
Co-ops	3	0	0	2	Avg.Ask: $117,719,000	5
Condos	0	2	1	2	Avg.Ask: $13,968,800 Avg.$/sq.ft.: $3,740/sq.ft. Avg.Size: 3,735 sq.ft.	5
Condop*	0	0	0	0	Avg.Ask: Avg.$/sq.ft.: Avg.Size:	0
Townhouses	0	1	0	1	Avg.Ask: $5,475,000 Avg.$/sq.ft.: $1,433/sq.ft. Avg.Size: 3,820 sq.ft.	2

*Condops are mixed-use co-op buildings with condo space typically in the commercial or non-residential portion of the building. CLICK HERE TO VIEW 10 CONTRACTS SIGNED ON APARTMENTS​ CLICK HERE TO VIEW 2 CONTRACTS SIGNED ON TOWNHOUSES​

Donna Olshan, President cell: 917-287-0458 home: 212-751-3300 x110 dso@olshan.com

Emily Chen, Private Wealth Real Estate Services Chief of Research 917-853-9235 ecc@olshan.com

Donna Olshan President dso@olshan.com

Emily Chen Private Wealth Real Estate Services Chief of Research ecc@olshan.com