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Luxury co-op/condos prices inch down in Manhattan.

Luxury co-op/condos prices inch down in Manhattan

With buyers growing more cautious, prices of luxury Manhattan co-ops and condominiums dipped in October, with the average cost of an apartment falling to $77, 580 a room. A year ago, the Corcoran Price Index was $82,458 per room.

So reports the November issue of The Corcoran Market Update, a monthly survey highlighting fast breaking trends in the New York co-op and condominium marketplace prepared by The Corcoran Group, a leading Manhattan-based real estate firm specializing in luxury residential sales.

Based on data from listings and completed purchases that took place during the preceding 30-day period, The Corcoran Market Update reported a mix of asking prices by unit size for virtually all of the 7,428 luxury apartments it tracked citywide last month.

For example, average asking prices for one-bedroom apartments decreased by .8 percent to $258,000 while two-bedroom (4.5 rooms) prices edged upward to $426,000. Overall, asking prices for all units were down .4 percent for an average price of $530,010.

"Right now, there's a lot of apprehension about the economy and that's definitely softening prices," asserted Barbara Corcoran, president of the Corcoran Group, who noted that "serious buyers were currently driving very hard bargains before closing a deal."

Other interesting findings reported in the latest Corcoran Market Update were: *Buyers were able to negotiate asking prices down by 19 percent during October compared to 29.3 percent during the same period in 1990 *The average listing time for apartment sales during the month was 22 weeks, compared to 48 weeks a year earlier. Average asking prices continued to vary dramatically by location. The price per room of a Fifth Avenue luxury residence (above 60th Street), for example, was $228,000 compared to $213,778 on Park Avenue and $77,333 on West End Avenue *The average luxury co-op/condo buyer last month was 32 years old, had an average annual income of $200,000 and made a purchase of $255,000

Meanwhile, after reaching a 13-year low in September, interest rates for New York luxury co-ops and condominiums fell even further in October.

So reports the Manhattan Mortgage Company, a leading specialist in co-op, condominium and private home residential financing, which surveys and analyzes New York mortgage rates and borrower preferences on a monthly basis.

According to its October report, which is based on data from 10 major lending institutions serving the New York residential marketplace, rates plummeted across the board for the two leading fixed-rate mortgages and the four most popular adjustable-rate mortgages.

In the fixed-rate category, 15-year fixed mortgages dropped from 8.875 percent to 8.625 percent and 30-year fixed mortgages fell from 9.125 percent to 9 percent.

In the adjustable mortgage category, six-month adjustables with five-year constant payments dropped from 8.5 percent to 8.25 percent, one-year adjustables dipped from 7.125 percent to 7 percent, three-year adjustables sank from 8.25 percent to 8.125 percent and five-year adjustables fell from 8.875 percent to 8.75 percent.

According to Ellen Feldschreiber, partner of Manhattan Mortgage Company, the drop in October's rates is a result of a continuing effort on the part of the Federal Reserve to encourage banks to lend and, thereby, spur the economy.

"The mortgage business is one of the few booming segments of the market because people are refinancing," said Feldschreiber. "The silver lining in the clouds of economic weakness is that home owners have the opportunity to dramatically reduce their monthly mortgage payments and that housing has really become very affordable."

In terms of loan preferences, The Manhattan Mortgage Company survey reported that 39 percent of co-op/condominium borrowers chose 30-year, fixed-rate mortgages in October, while one-year adjustables accounted for 25 percent of the marketplace.
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Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Real Estate Weekly
Date:Dec 11, 1991
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