No market can continue to sustain the astonishingly high prices that New York cooperatives and condominiums brought last year. The moderation of prices we are experiencing in 2001 represents a return to a more rational marketplace in which demand still chases a limited supply of product.
Starting with the last quarter of 2000 and through this year to date, there has been a leveling off of sales and prices. Looking ahead, we can reasonably expect a seasonal uptick in the market in the next quarter, especially if the Federal Reserve again cuts the rate. A cut in rates may bode well for the rest of the year.
Two factors should keep the real estate market reasonably healthy this year, in my opinion:
• The inventory of apartments in New York remains low. More space will be coming on the market his year but not enough to satisfy all of the continued high demand, especially for high-end properties.
• Unlike the stock market, the residential real estate industry does not react up or down to every blip in the economy, good or bad. Our business is more cyclical and even paced.