Hit hard by the pandemic the New York City’s real estate market is proving its resilience, once again. As the vaccine rollout increasingly allows life to approach normal, buyer appetite has returned with a vengeance.
According to UrbanDigs, 600% more contracts were signed in Manhattan from April to June than during the same time in 2020. However, it’s important to note that most of the year-over-year gains in sales simply represent a return to pre-pandemic market activity.
A recent study of PropertyShark across NYC shows significant increases like those in sales end median sales prices, respectively up by 88% and 13% over the same period of the last year and up 7% and 10% over Q2 2019. These last figures give us a clearer idea of the current market situation, which is rising compared to the worst moment of the pandemic but also to the same period of two years ago.
The same PropertyShark report shows that many wealthy neighborhoods are getting even more expensive and the city’s top 10 most expensive areas in NYC. Manhattan claims nine of the 10 most expensive NYC neighborhoods, with DUMBO the only neighborhood representing Brooklyn.
Here below the top 10, ordered by median sales price:
- Hudson Yards — $5,714,000
- TriBeCa — $3,250,000
- SoHo — $2,619,000
- Little Italy — $2,000,000
- Flatiron District — $1,925,000
- Hudson Square — $1,848,000
- West Village — $1,776,000
- Theatre District – Times Square — $1,731,000
- DUMBO — $1,490,000
- Chelsea — $1,480,000
By far at the top of the list, we found, once again, Hudson Yards. Under pandemic pressure, the same neighborhood saw its residential sales slowed so drastically that there wasn’t enough data for the second quarter of 2020. However, compared to Q2 2019, Hudson Yards’ median was up an impressive 48%. Even so, sales activity remained low, with only six sales closed in Q2 2021, far below the 56 sales of Q2019, in which the pre-mansion-tax buying frenzy had a key role.
Here is the link to the complete study
Palm Beach is running out of mansions for sale
Prices in Florida’s ultra-rich Palm Beach community hit an all-time high in the second quarter, with a record-low number of mansions to sell.
The average price for a single-family home in Palm Beach hit $11.7 million in the quarter, up 38% from a year earlier and marking a new high. “This is a whole reset of the market,” said Jonathan Miller, CEO of Miller Samuel, the appraisal firm. “We’re now seeing $50 million transactions on almost a weekly basis. That’s a big change. And it appears to be sustainable.”
Prices in Palm Beach are now almost on par with Manhattan, with the price-per-square-foot in Palm Beach topping $1,500 in the quarter, close to Manhattan’s $1,545.
Even with record-high prices, buyers are paying up. The number of sales of single-family homes in the second quarter jumped 90% over last year — when buying in Palm Beach and Florida was already picking up due to Covid migration.
The result is “a mansion shortage,” as demand outstrips supply. There’s now about a one-month supply of homes for sale in Palm Beach, a record low. As of the end of the second quarter, only 25 homes were for sale — and the actual number may be smaller due to homes already in contract or heading to contract.
Scott Shleifer, a partner at Tiger Global Management, bought a $122.7 million mansion in Palm Beach in February, marking the highest price ever paid for a property in there.
A private island on Palm Beach just sold to Todd Michael, a spec developer, for $85 million; he and his development partners plan to renovate the property and quickly relist it for a higher price, calling it a “once-in-a-lifetime opportunity.”