Crain's: "Sales Defy Expectations, Go Nowhere"

Interesting that there have been so few sales in Brooklyn, and that prices have barely budged there. http://www.crainsnewyork.com/article/20100413/REAL_ESTATE/100419967 NYC property sales defy expectations, go nowhere By Amanda Fung Published: April 13, 2010 - 1:53 pm Despite signs of an upturn in other parts of the market, the volume of properties sold citywide showed little change during the... [more]

Interesting that there have been so few sales in Brooklyn, and that prices have barely budged there. http://www.crainsnewyork.com/article/20100413/REAL_ESTATE/100419967 NYC property sales defy expectations, go nowhere By Amanda Fung Published: April 13, 2010 - 1:53 pm Despite signs of an upturn in other parts of the market, the volume of properties sold citywide showed little change during the first quarter, compared to the same period a year ago, according to a Tuesday report. Manhattan recorded the strongest activity, while Brooklyn was the weakest. During the first three months of the year, 373 properties sold, up 2.8% from the hugely depressed levels of a year earlier, according to the report by Massey Knakal Realty Services. The latest quarterly figures were far below the market's peak of the first quarter of 2007, when there were 1,353 transactions. Manhattan, south of 96th Street on the east side and south of 110th Street on the west side, experienced the most activity with 99 sales, close to double the activity from the same period a year ago. Brooklyn experienced the least activity. In that borough, only 107 properties sold, down 25% from the first quarter 2009. “There was not much change despite an anticipated increase in sales activity,” said Massey Knakal Realty Chairman Robert Knakal during a Tuesday morning press conference. Meanwhile, the value of the building sales fell to $2 billion during the quarter, down 0.07% from a year ago. Mr. Knakal noted that the sales of three Harry Macklowe properties represented roughly 29% of the activity in Manhattan in the period. In terms of increased dollar volume, northern Manhattan recorded the greatest improvement. That area almost doubled to $117 million from last year. In Brooklyn, sale prices dropped 23% to $162 million from the first quarter of last year. Similarly, in Queens prices fell 21% to $143 million. The citywide annual turnover rate—the ratio of buildings that sold compared to the existing building stock—was at 1.4% for the first quarter. The good news is the turnover rate is up from 0.7% in the first quarter of 2009. That represents a 35% to 40% increase in sales activity from the same period a year ago, Mr. Knakal said. However, that's still slightly worse than in previous downturns in 1992 and 2003. Mr. Knakal also predicts prices will hit the bottom in a couple of months and that the volume of sales will improve throughout the year. From 2007 to 2009, buyers were largely confined to high net-worth individuals and families who have invested in the city for decades. Now, the pool of investors is opening up again. Mr. Knakal noted an increase in foreign buyers and a return of institutional money with opportunity funds interested in buying distressed properties. While buyers never completely left the property sales market, there was a relative lack of buildings for sale. Mr. Knakal doesn't think supply will be an issue this year. “We think we will see a greater number of distressed assets come to market,” he said. “Discretionary sellers will also come to market because prices haven't fallen.” [less]