Manhattan prices continued to rise in Q2 2014, with new developments leading the charge and pushing average prices higher. The average price for condo and coop properties in Manhattan rose 17.9% to $1.69M over Q2 2013’s average of $1.425M. However, prices may be reaching their peak. While Q2 2014 presents impressive year over year growth, the average price has, in fact, dropped from the Q1 2014 high of $1.774M. After reaching a 14-year low of 4,164 listings in Q4 2013, inventory has spent the last few months rising, stabilizing the market as supply catches up to demand. Overall inventory is up 18% from Q2 last year, with condo inventory up 43% and new development inventory up 69% over the same period. With many new development projects slated to hit the market in 2015 and 2016, inventory should continue to rise steadily, softening condo prices across the board. Over Q1 2014, the Q2 2014 absorption rate (time taken to sell currently listed inventory) is up by roughly two weeks, bringing it to 5.1 months.
Though prices are high in Manhattan, excellent investment opportunities continue to emerge, particularly in Harlem. Whole Foods has just recently signed a lease to anchor a new retail property at 125th street, which will also house Burlington Coat Factory, American Eagle, and TD Bank, among other high profile retail tenants. This is a strong indicator of the continued growth of the neighborhood. Average price per square foot remains distantly below Manhattan’s more developed neighborhoods, coming in between $700-$1200 PSF, depending on the nature of the property. Townhouses on Strivers Row are a particularly excellent investment, given the limited inventory and ever-increasing demand for these historically important homes.
In Brooklyn, several areas look poised to become the next destination neighborhoods, such as: Prospect Heights, Fort Greene, Clinton Hill, Crown Heights, Lefferts Gardens, and Ditmas Park. These areas have only just begun to attract the attention of buyers and investors, and are trading at surprisingly low prices per square foot, given the upside potential. These neighborhoods have exceptional public transportation infrastructure, with simple commutes to most areas of Manhattan, and all boast close proximity to public parks, up-and-coming restaurants, cultural icons, the Brooklyn Museum and Botanical Garden, and more. With the average prices per square foot in the $500-700, these areas reflect where Williamsburg was in 2009. Despite fewer transportation options, Williamsburg has experienced tremendous growth over the last five years, with the appetite for properties in Brooklyn steadily rising.
The St. Nicholas Historic District (138th and 139th between ACP and FD Blvd) earned it’s more commonly used name “Strivers Row” after prominent black Harlemites, such as Bill “Bojangles” Robinson, Fletcher Henderson, Eubie Blake, and Adam Clayton Powell Jr. (to name just a few) made the bucolic and unique area their home.