The housing market in New York City has largely avoided the problems afflicting other cities and towns across the country: foreclosures, falling home prices, stalled construction.
Even Wall Street layoffs and smaller bonuses are unlikely to make a dent in Manhattan real estate, one of the most expensive in the country. Jonathan Miller, the CEO of real estate appraiser Miller Samuel, says high-end properties are selling quickly and often at record prices.
New York has been a "boring, mundane housing market" over the last three years with one exception, Miller says in an interview with The Daily Ticker. "We've had tremendous activity at the very high end of the market."
Miller says the majority of these multi-million dollar transactions are paid for in cash. Billionaire Russian Dmitry Rybolovlev paid $88 million last December for a 6,744-square-foot 10-bedroom on Central Park West for his 22-year-old daughter. That makes it the most expensive apartment in New York City (Rybolovlev paid the list price) at $13,000 per square foot. The seller was former Citigroup CEO and Chairman Sandy Weill who paid less than half the record-setting $88 million for it.
"I call 2011 they year of the foreign buyer," Miller adds.
High-end Manhattan real estate may be breaking new records, but the national housing market continues to stumble. Recent housing data has suggested a bottom but mixed data this week shows that housing could continue to drag down the U.S. economic recovery for the next year or two. Miller says one should not compare New York's housing market to national trends.
"It is not a proxy for how the rest of the market is doing," he says. "What's going on in the very high-end of the market is so disconnected from reality."
In less than a month, three New York City penthouses designed by famous architect Frank Gehry will be available for rent for $40,000 to $60,000 per month. Singer Alicia Keys and her husband Swiss Beatz have reportedly just put their Crosby Street penthouse on the market for $17.95 million.
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- Jonathan Miller