Manhattan’s luxury real estate market for the first half of 2005 remained strong, following a similar pattern to that of 2004, according to a report released today.
“Just like the first half of 2004, the market raged into late spring of 2005, prices surged, more records were broken and inventory plunged,” said Kirk Henckels, executive vice president and director of Stribling Private Brokerage, author of the report.
Also like 2004, Henckels said, the market then quieted because of low inventory and a sharp drop in consumer confidence. This status continued into the early summer, when consumer confidence rebounded along with the economy’s performance, according to Henckels.
According to the report, the $20 million-and-up property range increased in activity, indicating a return to the market of the “trophy property” buyers, who seek one-of-a-kind properties regardless of price.
The report said that in the first half of 2005 the sale of cooperative properties over $5 million exceeded the number of such sales in all of 2004 by 40 percent. A new record was set by the $44 million sale of a Rockefeller apartment, the report said.
As a result of the diminishing cooperative inventory, some buyers have sought residences in the townhouse market, according to the report.
Townhouses over $5 million experienced a 39 percent increase, almost the same as cooperatives, the largest being in the $10 million-and-over category. The highest price was $20 million, the report said.
The condominium market saw an increase in activity, with a most remarkable contract at 165 Charles St., a building designed by Richard Meier. At over $20 million this represents a downtown record-breaking price of $4,582 per interior square foot, the report said.
New developments and hotel conversions dominated the condominium market, according to the report. These include the full or partial development of the Plaza, the Stanhope, the Intercontinental, the Mayflower, the St. Regis, and the Gramercy Park hotels.
The downtown high-end sales tend to be spacious loft penthouses such as the $20 million unit at 165 Charles St. and Robert DeNiro’s Hudson Street loft for $12.25 million, according to the report.
The desire for either more uptown-type services, such as full-time doormen and concierges, or for offbeat properties, is the latest trend for loft buyers, the report said.
With a lack of inventory, cash-rich buyers and a growing economy, a dramatic decline in the Manhattan luxury real estate market does not appear likely in the near future, according to the report.
Henckels said a major stabilizing factor in the Manhattan luxury real estate market results from the fact that the residential market is still dominated by cooperatives, with stringent financial requirements for purchases.
An overall steady outlook is predicted for the remainder of 2005. “Most probably, the luxury real estate market will stay level, following the economy and consumer confidence until, a recession occurs,” Henckels said.
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