New development closings, with many contracts signed over a year ago, pushed the overall average Manhattan apartment price to a new record in the fourth quarter. At $2,110,556, the average price was 9% higher than a year ago and just above the previous record set in the first quarter of 2016. The number of sales was 13% lower than a year ago, with 39% fewer new development closings and 4% fewer resales.
New developments, which comprised nine of the top 10 sales in the fourth quarter, sold for an average of $4,709,602. This was a new record, and was 51% higher than the fourth quarter of 2015. The resale average price of $1,512,074 was 1% lower than a year ago, while the median price rose 2% to $920,000.
Notice that the headline number implies prices are still increasing, yet taking a closer look at the data tells us otherwise. Looking at just resales, we see a market where the average price has been drifting lower for the past few quarters. Resale listings spent 10% longer on the market than in the fourth quarter of 2015, and apartments are selling at the lowest selling-to-asking price ratio in more than three years. Buyer hesitancy and seller overpricing have led to sharp rises in inventory, particularly for larger apartments, which increases the need for price adjustments for many listings.
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