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| �2003 Judith Grover writer, editor, about, clips, r�sum�, contact |
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| the World Trade Center attacks didn�t materialize at the time, recent reports confirm that the real-estate market was hit in the fourth quarter of 2001. While statistics from the major brokerage firms in the city show that sales volume remains somewhat steady taken as a whole, overall, both apartment sales prices and average time on the market have declined. The luxury market, already showing signs of a fall-out six months ago, remains bleak and the downtown real-estate market�despite original reports of business-almost-as-usual�did indeed take a bashing following September 11th. One reason for optimism: A trend towards purchasing smaller apartments is emerging in the winter apartment-hunting season, which began around Thanksgiving. Normally the deadest time for co-op and condo sales, the market is bursting with what Insignia Douglas Elliman�s Manhattan Market Overview calls the �shift in the unit mix.� Despite the declines, activity for sales of smaller units is on the rise. Glory Days The year 2000 was a time during which residential real estate in Manhattan sustained its dominance. Continuing in and even surpassing1999�s regal footsteps, 2000 espoused an astonishing renaissance of New York City during which every neighborhood was marketable. According to The Corcoran Group�s Year-2000 analysis, the residential market was resilient to stock market fluctuations and incipient worries about the national economy. With phenomenal 21 to 23 percent increases in the average sales price indices over 1999�s record-high levels, the report cited the strong demand for the Gotham lifestyle that led to a 30 percent decrease in buyer negotiability to a mere 2.6 percent off asking price. It was a seller�s market in the purest sense of the term. New construction condos continued to raise the ceiling and floor on all property values market-wide. Feeding the record-breaking prices was the higher standard of luxury lavished on new apartments, often exceeding buyer expectations. In existing co-ops, whether pre- or post-war, the prevalence of high-quality renovations contributed to the softening of whatever initial buyer resistance there might have been. In 2000, the city was in the thrall of a booming economy and the effect was the steady transformation of where buyers where willing to live and how much they were willing to pay to live there. Gimmicks to market virtually every neighborhood actually worked; they homogenized Manhattan and permeated each area with Upper East Side values. Every neighborhood was made to sound like yet another new yuppie sanctuary. Agents made a concerted effort to market each area as its own hip location (with its own nifty new acronym). Southern Harlem became "SoHa" and the area above the Battery Tunnel became "NoBatt." Once known for animal carcasses and transvestite hookers, the meatpacking district was christened "MePa" and colonized by fabulous cafes and trendy lounges. And with each transformation, outfits like Starbucks followed suit. Brokers began calling second and third floors "townhouse" floors. Walk-ups were described as "charming." Downtown posted the most spectacular gains citywide in every category of co-op sales during the boom. Year-end 2000 Corcoran statistics demonstrated that the average sales price soared 42 percent downtown, and average price-per-square-room swelled 29 percent to $107,000 for the year. A magnet for the young and hip, the culturally diverse area boasted the highest average sales price in Manhattan for co-op studios and one-bedrooms. Of the downtown neighborhoods, Greenwhich Village was the priciest for two- or three-bedroom co-ops. Dowtown two- and three-bedroom condos beat out the breathtaking gains of both those on the East and West Sides, with two-bedrooms skyrocketing 42 percent to $712,000, and three-bedrooms 38 percent to almost $1.2 million. The West Village, with the development of Hudson River Park, emerged as the most expensive condo market downtown where one-bedrooms averaged $557,000, rivaling the Upper West Side�s prized Lincoln Center vicinity. Demand for downtown lofts gulped up the spate of new conversions in TriBeCa, the Meatpacking District and Chelsea. Average sale prices topped $1 million for the first time, 11 percent higher than the 1999 average. Shooting up 20 percent to $523, average cost per-square-foot attained a range associated with traditional apartments on the Upper East Side. The greatest amount of sales activity occurred in Chelsea and the West Village, both beneficiaries of the new Manhattan order. �It was this incredible, euphoric time, said Douglas Elliman�s broker Dolly Lenz�one of the most successful brokers of the boom�in March 2001. �Everybody had to have what their friends had,� confided Lenz. �I�d literally make money picking up the phone.� Manhattan brokerage firms grew larger, created new office divisions and, in some instances, merged. Apprehension set in following a dip in activity at the end of 2000, but brokers said things picked up again in February 2001, so that a year ago, brokers had a reason to remain hopeful. But still, expectations were sent askew. �People are scared,� admitted Halstead Property Company�s broker Robin Horowitz at the time. She had a unit that went on the market five months earlier for which the seller was holding out. Come Mid-2001, he was motivated to sell, and at a figure quite a bit lower than the original asking price. Post Boom, Pre-9/11 Before anyone knew�or was willing to admit it�the time of bidding wars and higher-than-asking prices was long gone by March 2001. Prices were going down, to the point where some brokers reluctantly agreed that an eight percent discount had taken effect by that time. By all accounts, though, Lower Manhattan was not much impacted. According to Warren Wechsler, first senior vice president of the Real Estate Board of New York (REBNY), the city�s largest real estate trade association, "Conditions were relatively favorable� Office prices were steady. Housing prices were still increasing, though not as fast as a few months before." |
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| After an era of seemingly implausible figures�with the average price of a Manhattan apartment closing in on $1 million�New York City�s residential real-estate market has started to lose its sense of certainty. Any broker asked about the state of affairs in mid-2001 responded things are just fine, thanks. While none denied the boom was over, they maintained the almost fail-safe optimism that characterized Manhattan�s residential market following the astonishing trends of 1999 and 2000. However, while evidence of an outright panic following |
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