New York-The Absolute Best Investment

Sep 07, 2006

Another summer has ended, but the Manhattan Real Estate market still remains the hot topic of conversation. Are we in a buyers or sellers market? Can apartment prices climb even higher? Will the creeping inventory levels lead to a pricing correction in the near term? Without a doubt, it is a challenging and vexing time to be a Manhattan homebuyer, particularly if you are dipping your toes into the market for the first time. This column hopes to clear up some of the confusion by looking back at the way things were five years ago.

Heading into September 2001, the average price for a Manhattan coop was $518 per square foot, up 13% from $460 in the year ago period. The average price for a Manhattan condo was $691 per square foot, up 11% from $613 per square foot. Of course, 9/11 happened and Manhattan apartment prices went into a temporary tailspin. During this time, a skittish buyer famously forfeited a hefty $650,000 deposit to a famous blond actress to back out of a deal.

But the brave and the shrewd saw the pricing correction as golden opportunity to claim their piece of New York, and they have profited quite handsomely. By September 2002, the average price for a Manhattan coop rebounded to $562 per square foot, up 8% from the prior year. The average price for a Manhattan condo advanced 7% to $741 per square foot. Even more remarkable, the average prices for Manhattan coops and condos are now hovering around $995 and $1,150 per square foot, jumping 92% and 66% over the past five years, respectively.

Is now the right time to buy? If you plan to be a New Yorker for the next five years, the answer is a resounding yes.

< Can you sell on your own? Yes. Should you? No!

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