High-end Apt. Prices vs. Peak and Trough

I know it is not a perfect parallel... but 4+ bedroom apartments.... median Manhattan sales price.

After falling 67% from peak, they're now down 55% from peak (Q4 at least). Median was $10-12MM back in 08, its in the $4-6MM range now.

Somewhere.....what is the source of your data?

I have not observed 55-67% price declines.

MillerSamuel says peak median for 4+ co-ops was 4Q 2008 at $10,500,000 (14 sales.)

Bottom was 2Q and 3Q 2009 at $4,200,000 (26 and 33 sales.)

4Q 2010 was $5,040,000 (41 sales.)

Those're closings, so figure a quarter or two back for contracts.

Yeah, I'm coming from the miller samuel data as well, Manhattan median.

Although the top was actually Q1 08 - $12k.

Year Quarter 4+ Bedroom
2010 4 5,400,000
2010 3 6,000,000
2010 2 4,650,000
2010 1 5,650,000
2009 4 4,242,265
2009 3 5,181,110
2009 2 3,920,000
2009 1 7,889,000
2008 4 8,750,000
2008 3 10,225,000
2008 2 7,350,000
2008 1 12,000,000
2007 4 5,400,000
2007 3 6,567,712
2007 2 6,600,000
2007 1 6,450,000

SWE pulled condo-and-coop numbers, while I did just co-ops.

Man, SteveF is just so pissed for being proven so wrong.

Sorry, toots.

I know you lost the few pennies you had, but to resort to cursing and calling people "c*nts"... that is pathetic.

> SWE pulled condo-and-coop numbers, while I did just co-ops.

I just figured with the small amount of sales, better to get the combined.

"Although the top was actually Q1 08 - $12k."

I will happily buy ANY Manhattan 4BR+ for 12k. Anyway, while I generally like Miller Samuel data, you have to recognize that the 4BR data suffers from a bit of SSSS.

YJBO, we got sidetracked on 4+ bedrooms. MillerSamuel has a luxury category (top 10% of sales, I think) that'd be more useful. You can can narrow by neighborhood, etc.

YJBO -- I think the best answer for THE TOP of the market is Peak To Trough = down 27%, with the current 'recovery' (net) down 13%. My worksheet is below.

Apples To Apples is difficult. I am not sure median price data is the best way to analyze this, but it is probably easier to work with than anything else. The Miller uses the Top Ten Percent of any quarter as his luxury measure, which is probably a better high-end number than 4BR sales (pretty thin, with only 14, 26, 33, and 41 deals in the 4 quarters NWT looked at).

I bookmarked Median Sales Price in that niche by quarter, 2006-10, and was surprised at how little volatility there was (I expected more): http://aggregate-data.millersamuel.com/home/query_report?annual=0&area=17&housing_type=8&measure=4&region=1&year_end=2010&year_start=2006

Aside from 1Q09 near $6.6mm, all other quarters range from $3.35mm in 4Q06 to near $5mm in 1Q08. If 1Q09 is an outlier and those first two quarters of 2008 are The Peak, the bottom was 2Q09 (down 27% from Peak), and each of the 4 quarters of 2010 were down since Peak from 8% to 18%.

Again: *if* that spike at 1Q09 is an outlier (look at the next 2 Qs!), then Peak was 1Q08 at $4,989,425, Bottom was 2Q09 at $3,660,608 (down 27%), and last quarter was $4.35mm (down 13% since Peak).

If you care about how many deals are in this niche for each quarter, you won't be surprised to see that 1Q09 has the fewest (120) The full distribution should be here: http://aggregate-data.millersamuel.com/home/query_report?annual=0&area=17&housing_type=8&measure=5&region=1&year_end=2010&year_start=2006

Really tough to say as the data is very distorted by the recent take-off of the ultra-high-end (say $25mm) market.

Also, remember that just before last peak, the best apartments were probably co-ops and townhouses. Then you introduce great new condo buildings like 15 CPW -- what does that due to the value of the co-ops and townhouses, absent any market movement? In other words, what's secular change, and what's cyclical?

***

Still, let's try to look at an apple over time -- let's look at the "B" line of Trump World Tower.

In terms of secular change from, say, 2002, TWT should have declined -- it had a 421(a) that's expiring, so monthly costs were going up; the UN renovation affected the views, though obviously not that much from the high floors; newer, fancier buildings had gone up (and it lost its place as the tallest residential tower in NYC).

***
Here are the trades I see:

* 49-B lists for $4.4mm in Nov 2004, when its real estate taxes are around $3,500 (I guess before the abatement is granted)? sells for $3.5MM

* 43-B lists for $4.2 mm in May 2006, when its real estate taxes are around $1,700, sells for $3.87MM.

* 52-B lists for $4.7 mm in July 2007, when its real estate taxes are around $1,850, sells for $5MM.

* 50-B lists for $5.2 mm in March 2008, when its real estate taxes are around $2,851, sells for $3.995M.

* 46-B, as far as I can figure, does not list, but sells for $6.26MM in April 2008.

* 39-B FAILS to sell for $4.8 mm in June 2009, when its real estate taxes are $2500, it has an assessment of $1200, and there's no lending on $5mm properties.

* 44-B lists for $4.45mm in June 2010, when its real estate taxes are $3900, sells for $4.2MM.

If we ignore 46-B as a sale to a neighbor, we mark peak in summer 2007 at $5MM, trough in 2008 at $4MM (possibly in 2009 there would have been a trough clearance at $3.5MM, but we had no lending, and thus no trade to show us), and bounceback in 2010 at $4.2 MM.

That pretty much confirms OP's theory, except I'd say we're slightly less down from peak than the 25% he/she hypothesizes... this example shows 20%, and if I had to generalize, I'd say 15-20%.

ali r.
DG Neary Realty

> this example shows 20%,

With a doubling of maintenance...

I think the OP is more accurate.

SWE the CC+ taxes or maintenance affects the affordability, but the price is the price, which is down 20%
Ali, very good example; the "market" always includes data sample bias, and your analysis show direct comps.

Thanks PMG.

SWE where I was going is that if the price is "only" down 20% in a building that has a lot of factors against it* -- including a doubling of maintenance** -- then the price effects on buildings that haven't seen such a rise in carrying charges should be slightly less.

ali r.
DG Neary Realty

*I mean, seriously, A-Rod buying in the Rushmore? Five years ago, Trump World Tower (aka Derek Jeter's building) would have been a slam-dunk for him... shows how much it's been upstaged by newer product.

**Monthly charges at TWT have jumped partly due to the maturation of the 421(a), but also partly due to a lawsuit that I'm happy to talk more about if anybody wants to write me off-board.. as you can probably tell, this building is one of my favorites.

Remember, Arod bought at Trump Park Ave first... but I think that was more about going west side than specifically non-trump. The Yankees who bought after went for Beacon (Abreu, Damon).