The Manhattan Times

Northern Manhattan real estate sales volume down 50% from third quarter 2008; prices holding steady

by Daniel P. Bader

In 2008, while the housing market disintegrated across the country, Northern Manhattan’s real estate industry was remarkably strong. Third quarter sales had sprinted past the figures from 2007 with increased volume and sale prices as the nation as a whole slid into recession.

Sales figures from the third quarter of 2009 show that while the Northern Manhattan real estate market is different than the rest of the nation, and even the rest of Manhattan, it is not immune to the economic downturn. For the northern portion of the borough, including Harlem, sale prices and the number of sales dropped significantly between July and September of 2009 when compared to the same period last year.

“While the average price fell for all sizes of apartment in Northern Manhattan over the past year, the biggest declines were seen in smaller apartments,” reads a report from Brown Harris Stevens, a major real estate house in the city. The Corcoran Report, released by the Corcoran Group, echoed that sentiment: “Uptown experienced … a 21-percent decline in average price per square foot,” it said, because of sales volume decline in studio and one-bedroom sales.

Since it can take several months for a sale to close, the reports represent actual real estate activity from earlier in the year.

Those reports, however, give a cloudy picture of real estate north of W. 155th Street because their sales figures include Harlem, which was severely impacted when the housing bubble burst, and do not include sales from the two biggest agents in Northern Manhattan, Simone Song and Stein-Perry.

Data gleaned from www.streeteasy.com give a clearer, and somewhat rosier, picture of just the Washington Heights and Inwood market. The Web site, which has become a reliable fount of all things real estate during its short existence, catalogues each individual sale in a database that is searchable by Zip Code.

In Washington Heights, just half as many co-op apartments were sold from July through September this year compared to last year: 39 sales compared to 80 in 2008. However prices remained steady. The average co-op price fell just slightly, from $370,000 to $361,000.

[These numbers attempt to provide the best possible snapshot of the area’s primary market and exclude aberrations such as sales at 504 W. 171st Street where tenants of a jailed slumlord were given his building after the city took it for taxes owed.]

Inwood sales fell in roughly the same pattern. This year 12 co-op apartments were sold in the third quarter compared to 22 sales in 2008. Although it’s difficult to draw conclusions from such a small number of sales, the average sale price in Inwood fell to $325,708 from $342,500 in 2008. While StreetEasy does not always record the number of rooms or square footage of a sale, it did for most of the 12 units sold in Inwood. Seven were two-bedroom apartments, three had one bedroom and one was a studio.

Northern Manhattan’s substantially smaller condo market fared no better than local co-ops. In 2008, 34 condos in Washington Heights and Inwood were sold. This year just 14 sales were recorded with an average price of $375,786, according to StreetEasy.

The only way to compare sales of different sized apartments in Northern Manhattan is to use data that include Harlem.

According to Brown Harris Stevens, between this year and last year, the average price of a one-bedroom apartment dropped 32 percent, from $463,415 to $380,770. Two-bedroom prices dropped 11 percent, from $583,584 to $519,583, and three-bedroom units dropped 15 percent, from $1,130,325 to $964,950.

The Corcoran Report reported that the median price of a co-op one-bedroom apartment dropped by 11 percent, from $330,000 a year ago to $295,000 this year. Two-bedrooms dropped 15 percent, from $490,000 last year to $417,000. The smallest and largest apartments, three-bedrooms and studios, each dropped by over 30 percent in median price. A three-bedroom in the third quarter of 2008 sold at a median price of $625,000 compared to $425,000 this year. Studios that sold for $293,000 in 2008 fetched $191,000 this year.

Condos, which were the biggest area of growth in Northern Manhattan last year, saw a 38-percent drop in median price in the last year, from $620,000 to $382,000. Condos, possibly because of their typically smaller floor plans, largely maintained their average price per square foot while co-ops, saw the average price per square foot drop from $564 to $478 a 15-percent decline.

In an interesting aberration for a neighborhood with a majority of pre-war co-ops, a two-family house was sold on W. 165th Street for $390,000 over the last three months.

Compared to Manhattan as a whole, Washington Heights and Inwood are lagging a bit in sales. Corcoran reports that city-wide the number of properties sold is down 38 percent compared to the almost 50 percent drop in Northern Manhattan.

Simone Song Properties owner Simone Song said her business is down, but not by as much as StreetEasy’s data would indicate. It’s closer to the 38 percent decline that the rest of the borough experienced.

If October sales are any measure, the fourth quarter may signal that the market is strengthening. Northern Manhattan logged 14 co-op sales in the first three weeks of the month.

Douglas Prudential Elliman agent Perry Payne chalks up the rise in sales to the $8,000 First Time Homebuyer Tax Credit, part of the federal government’s American Recovery and Reinvestment Act of 2009.

“Most of them are first time homebuyers trying to get in under the wire,” Payne said. For a first time homebuyer to qualify, a sale must close by Nov. 30.

“My open houses are busy,” Payne said. “Things first homebuyers are looking for are moving.”

For Song, the tax credit had little to do with her increase in October sales – she only had one first time buyer – but she thinks the next quarter will end on a high note.

“The fourth quarter I expect to be the best of the [year],” she said.