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Residential report shows stabilizing prices.

The outlook for the 1993 Manhattan co-op and condo market is encouraging. The Douglas Elltman 1992 Report, released this month indicates that the bottom of the co-op and condo market appears to have been reached since prices have stabilized. As a result sales are expected to pick up during 1993.

The Douglas Elliman Manhattan Report is based on 5,261 co-op sales from January, 1988 through December, 1992, and on 13,650 condominium sales and 187 single-family townhouse sales from January, 1988 to September 30, 1992. The results of this study indicate that the decline of Manhattan Real Estate may have actually ended. The strong increase in buyer activity is not only due to well priced homes but is also due to the perception that we are no longer at the bottom and that those who wait will miss good prices as well as low interest rates. This is true for first time buyers and also those wishing to upgrade. Furthermore, we believe that this has inspired hope in people who have been discouraged with the Manhattan real estate market, both on the buying and selling ends.

During 1992 the cooperative sales market experienced a mere 3.2 percent decline in price per room following a 30.2 percent decline from the 1988 peak to 1991. The Douglas Elliman report shows that prices on larger two-three-, and four-bedroom apartments have stabilized, while the smaller studio and one bedroom apartments are in many cases still declining. The prices of Million Dollar 'plus' cooperative apartments even enjoyed a 4.6 percent increase during 1992, having suffered least from the recession.

Another area of the market where we are witnessing an increase is within the Single Family Townhouses. Although the small size of this market makes it difficult to accurately analyze volume, Douglas Elliman has reported a 5.4 percent increase during the first nine months of 1992 over 1991 levels.

While the cooperative sales market is busy getting back on it's feet, condominium sales suffered their greatest price drops in 1992. During the first nine months of last year condominium prices dropped 14.8 percent, a reversal from the stability experienced through 1991. The only exception in the condominium market that has been able to escape this decline is the Upper East side of Manhattan, where 1992 prices were only 2.3 percent below 1991 prices. Much of the decline in price is attributed to bulk sales at low prices and we are optimistic that for 1993 as these troubled properties are worked through the system that prices will stabilize in the condominium sector as well.

Another continuing trend we are seeing in the Manhattan residential real estate market is the change in; the profile of foreign buyers. Although foreign interest remains strong we are seeing a different cast of players. The Far Eastern investor, particularly the Japanese has been replaced by a flurry of Westerners who have entered the market in force. The Italians seem to be the most prominent among this new group to be rediscovering New York. South American investment in Manhattan continues to be strong, being viewed as a savvy long term investment and an ideal place for a U.S. home.

We are also noting an overall conservative change in the buyer of the 90's. Most current buyers are wellversed and demanding, taking time to see numerous properties and making their own comparative price analysis They are allowing an extended period of time for the selection process every at the risk of losing a particular property.

The Douglas Elliman Manhattan Report has confirmed the beliefs of many that the market has been doing turnaround in 1992 and we are confident that this trend will continue through 1993. Prices should for the most part remain stable, though we predict that the higher end will see small increases. As always the improvement will start in prime neighborhoods and quality buildings and filter down.
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Title Annotation:Review & Forecast Section I; prices and forecast for cooperative apartments and condominiums in New York, New York released by The Douglas Elliman 1992 Manhattan Report
Author:Rogers, Alan J.
Publication:Real Estate Weekly
Date:Jan 27, 1993
Previous Article:Overall, Manhattan leasing up in 1992.
Next Article:Exclusive agent in Yonkers.

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