Periodically, we ask the same question that maybe many buyers ask themselves. Is NOW the right time to buy a Manhattan apartment? So many reports and so much confusing data, broker speak, developers’ spin etc…. How do you interpret it all and make a wise purchase that your family can enjoy without overpaying?
Let’s start with the obvious and state the market is a dichotomy right now. Over $5mm, you need to be patient as a buyer and make sure you find value. A 2500 sqft apartment with a view of Central Park on Manhattan’s upper west side in a recent conversion that is selling well is value. See 360 CPW for example. According to streeteasy.com, 26 active listings and all 26 properties in contract. Look for higher prices on the next round of listings. Take a look at 50 Riverside boulevard, aka One Riverside Park, the amenity rich building at the southern tip of Riverside boulevard. A 3 bedroom/3 bathroom there that sold for $4.1 million is up for sale for $4.35 million. At a price under $2000 per sqft. That’s pretty reasonable if that word can be used to describe Manhattan real estate.
Abover the $5mm mark, it gets dicey, above $10 mm even more so. In this range, the market has slowed and it really warrants a careful analysis to see if you are actually getting value to avoid buying something that will be worth 20% less in 1 year. But in some cases, when you shop for a unique property(let’s say over $20mm), it might just be that you want a specific location, amount of outdoor space or a certain building. At that price points, if you found that needle in the haystack you probably will need to pay for it.
Where do you need to be very careful if you are searching for a value or solid investment under $3 million? Watch out for walk ups or first floor units. These type of apartments sell well when the market is hot. Let’s say you want to sell in 5 years in a tepid market ,you might take a hit. Also, watch out for buildings with higher than normal monthly charges. Ask why are they so high. Generally speaking, you will pay about $2 to $2.5 per sqft in monthly charges depending on the building. Above that, you are in the higher end of the range and may end up with even higher charges in the coming years. The higher your common charges go up beyond the norm, the harder it will be for your apartment to appreciate.
In summary, it might be the exact time to buy right now with interest rates low, and if you find either an apartment that has built in value due to price or the amount of space that you will need long term.