The year 2008 is likely to go down in history as one of the most disappointing (or maybe flat-out alarming) for the U.S. economy in general. To be fair, the city hasn’t suffered as much as most of the nation has—but the co-op and condo market has not escaped the crisis unscathed.
The subprime mortgage crisis sent shock waves through the economy, and now, many new condo developments have gone for months with barely half of their units sold. Some have lowered prices, some have switched gears and become rentals, and in extreme cases, some have just stopped construction altogether.
A Very Bad Year
Ask how the tanking economy affected the residential real estate market, and you’ll see that there are many ways to say “not very well.”
“For many brokers,” says Kirk Henckels, executive vice president of Stribling Private Brokerage, the well-known luxury brokerage in Manhattan, “the first half of 2008 was the best they have ever had, and the last half was the worst.”
The hard numbers compiled by Yale Robbins, Inc. (The Cooperator’sparent company) and owner of Condo-Sales.com bear this statement out. While the average price of a condo in the city increased 1 percent from $1,550,284 to $1,563,058, the number of units sold was down significantly. Total condo sales in 2008 numbered 7,348, down from 8,107 units in 2007—a decrease of nearly 800 units. Month-to-month decreases in the first part of this year point to an even greater decline in sales. For example, February of 2008 saw 551 condo units sold, but February 2009 saw only 236 units change hands—a 57 percent nosedive.