Ultraluxury Apartment Sales Drive Records in Manhattan Real Estate

April 2, 2014 - PRLog -- The flurry of activity at the top pushed the number of sales to a seven-year high for the quarter and sent the average price per square foot soaring to a record $1,363, according to a report by the Douglas Elliman brokerage firm. Low inventory, high demand and a shift toward larger units in new luxury developments contributed to higher prices. The median price of a condominium jumped 13.4 percent during the first quarter from the same period last year, setting a record at $1,355,000, according to the Elliman report.

“This is the first time that we’ve seen this spike in price,” said Diane M. Ramirez, the chief executive of Halstead Property, which reported that the average price for an apartment in Manhattan set a record at $1,715,741 during the first quarter, up 30 percent compared with a year ago.

Over the past year, she said, “prices have been going up at a relatively moderate pace,” but the lack of inventory and high demand meant a significant uptick was imminent. “You knew it was coming,” she said.

Such robust price gains are “slightly exaggerated” when compared with the relatively weak first quarter of 2013, which saw a lull after a rush of high-end closings at the end of 2012 by buyers seeking to avoid impending tax changes, said Jonathan J. Miller, the author of Elliman’s report and the president of the appraisal firm Miller Samuel.   http://www.sarvodya.com/project_view/shree-vardhman-sohna...

Even so, “the chronic lack of inventory of the last several years is finally beginning to impact pricing,” Mr. Miller said.

Over all, the median sales price rose 18.5 percent to $972,428 in the first quarter compared with the same time last year, which is about 5 percent below the 2008 peak.

Brokers expect those numbers to continue to climb. “You won’t have 18 percent price jumps every month — that’s not sustainable,” said Dottie Herman, the chief executive of Douglas Elliman. But the median price will rise, she projected. “I expect it to be caught up 100 percent by midyear,” and then slightly surpass the height of the market in 2008, she said.

While new developments represented less than 20 percent of market-wide closings, they drove some of the biggest price increases. The average price of a condo jumped 35 percent in the first quarter compared with the same period last year to set a record of $2,368,077, skewed largely by the sale of two penthouses, according to reports by Halstead and Brown Harris Stevens. In January, a $50.912 million penthouse closed at Walker Tower in Chelsea. And last month the media mogul Rupert Murdoch purchased a $43.01 million triplex penthouse atop One Madison on the southeast side of Madison Square Park. The mega-sales are expected to continue as contracts for apartments exceeding $90 million apiece at premium developments like 432 Park Avenue and One57 turn into done deals.