more on the $5 million Manhattan loft market, a year over year look

difficulty at the $5 million level is not a new phenomenon for Manhattan lofts

My post on Tuesday considered whether the December string of downtown Manhattan lofts that took a long time to sell around $5 million that I noticed on my Master List of Manhattan Loft Sales suggest3ed that there was some softening in that market segment, or merely reflected a particular bunch of unrealistic sellers. That February 23 post, $5 million data points: unrealistic Manhattan loft sellers or market softening?, offered 18 data points, lofts that sold between October 1, 2015 and January 31, 2016 that had been offered originally at $4.5mm or more, eight of which sold for at least a 10% discount to the original asking price. See that post for the details, and my musings about What It Means (or, whether it means anything).

When dealing with a niche market (downtown lofts), then further slicing to a narrow price range (starting at / above $4.5mm, selling at / below $6mm), the data get … thin. Which is one reason blogging in real time is a fraught enterprise. Even within a niche of the Manhattan residential real estate market, having only some data always leads to other questions, or begs for a broader context. I used The Miller’s quarterly report for the overall Manhattan market for some context, but that yielded few direct correlations. Another way to broaden the context would be to see how the Tuesday data set of 18 loft sales compares to other time periods.

The two tables below match the tables from Tuesday’s post, this time with 24 data points that provide a year-over-year context, ten in the table of lofts that sold at least 10% below their first ask and 14 that didn’t need such a haircut. (Compared to eight and ten on Tuesday.) These 24 lofts sold between October 1, 2014 and January 31, 2015 and all but one started asking $4.5mm or more (like my Tuesday set); the one exception started lower but sold just above $4.5mm so is fair to consider when looking at the market “around $5 million”.

First the tables, then the talk. (As on Tuesday, “[r]epeat after me: anecdota are not data. But a series of anecdotes are data points.”) The unhappier set of ten:

sold on price DoM 1st ask discount
144 West 18 St #6E  Jan 29, 2015 $4.45mm   97 $4.95mm 10.1%
474 Greenwich St #4S   Jan 23 $2.95mm 429 $4.75mm 37.9%
105 East 16 St #5 Jan 22 $5.125mm 164 $5.95mm 13.9%
62 Cooper Square #4A  Dec 23, 2014 $4.6mm 298 $6mm 23.3%
738 Broadway #2 Dec 23 $3.85mm 295 $6mm 35.8%
17 East 16 St #6 Dec 19 $4.35mm 51 $5mm 13%
117 East 24 St #8 Nov 20 $5.6mm 588 $6.5mm 13.8%
195 Hudson St #2C Oct 20 $4.08mm 94 $4.995mm 18.3%
481 Greenwich St #5B Oct 6  $3.95mm  ??  $5.15mm 23.3%
35 West 23 St #3 Oct 1  $3.75mm 367  $4.925mm 23.9%

The happier set of 14:

sold on price DoM 1st ask
155 Franklin St #3N Jan 30, 2015 $5.52mm   137 $6mm
225 Fifth Av #6K Jan 29 $4.6mm 37 $4.5mm
73 Worth St #2B Jan 29 $4.6mm 49 $4.995mm
144 West 18 St #2W Jan 28 $5.6mm 8 $5.5mm
15 West 24 St #6 Jan 23 $5.5mm   91 $6mm
28 Laight St #3E   Jan 12 $5.35mm 213 $5.75mm
144 Franklin St #3 Dec 23, 2014 $5.425mm 26 $4.75mm
429 Greenwich St #2C Dec 19 $4.895mm 85 $4.895mm
62 Cooper Square #2T Dec 3 $4.78mm 19 $4.995mm
30 Bond St #PH Nov 19 $5.35mm 86 $5.5mm
53 Greene St #3  Nov 4  $6mm 172  $6.34mm
345 West 14 St #4F  Oct 20  $5.5mm 41 $5.5mm
15 West 24 St #11  Oct 16  $5.45mm  142  $6mm
140 Sullivan St #5  Oct 14 $4.506mm  50  $3.9mm

Again, a couple of notes, always remembering that these two sets and Tuesday’s more current pair may simply be too small for firm conclusions:

(a) It can (still! always!!) take a long time to sell Manhattan lofts that are over-priced.

(b) While the current set of happier sales (from the seller perspective) included several that took a long time to sell, even though being priced reasonably close to their clearing price (Days on Market in that set of ten of two included 477 days, 363 days, 223 days, and 171 days), a year earlier the happier set of 14 included ten that took three months or less to find a contract, while none of the other four took as long to contract a year ago as the three longest of the current set.

(c) While ten of the 18 current set took at least a half year to contract, only six of the Unhappy Set and one of the Happy Set a year ago took at least that long, or seven of 24 in total (while I don’t know exactly when 481 Greenwich St #5B went into contract, it is clear from our data-base that it had to be at least that long). Whether the difference between 10/18 and 7/24 is meaningful to you may be a matter of taste, or of statistical relevance above my pay grade.

In Tuesday’s post I looked for context to The Miller and his Days on Market comparisons from his Manhattan Market Report for the last quarter of 2015. He found (using a different way to measure Days on Market) that the overall Manhattan residential market was quicker in the Fourth Quarter of 2015 than the same quarter in 2014 (82 days v. 105 days), while his “luxury” niche (the upper 10% of sale prices) was also quicker recently (150 days v. 160 days). Whether  statistically significant or not, I find the downtown Manhattan loft niche around $5 million to present the opposite trend, largely driven by the relatively quick success of the low-or-no-discount lofts from October 2014 through January 2015.

Not to go all Tolstoy on you, but last year’s data sets suggest that happy loft sales were substantially alike (nearly all were relatively quick, four sold above ask and two at ask), while unhappy loft sales (needing the big discounts) were likely unhappy in different ways. I suspect that was especially true last year, with two of the unhappy lofts needing one-third off and four more nearly a quarter off. The happy ones largely sailed through The Market.

Offered for your consideration … draw your own conclusions. And continue to watch this space ….

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  1. […] market, as so many commentators have been commenting on recently. If you saw my February 26, more on the $5 million Manhattan loft market, a year over year look, you saw me struggle with exactly that issue, using the thin data about loft sales at the top of my […]

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