Competition for Manhattan apartments priced under $3 million will be fierce this spring and summer, according to real estate experts.
With the tumultuous presidential election season and setbacks in the global economy, interest in the ultraluxury market is slowing down, they said.
“The political environment is causing people to question what is going on with the economy, the international market’s definitely been suffering, and you still hear about layoffs,” Citi Habitats president Gary Malin said.
Because of this uncertainty, there is increasing demand for apartments priced in what Malin calls “the affordable market.”
According to Alan Lightfeldt, a data scientist with the listings site StreetEasy, competition is expected to be extra fierce for homes in Upper Manhattan and East Brooklyn — where prices are relatively affordable compared to the rest of their respective boroughs.
The median sales price in East Brooklyn in 2015 was $521,181, compared to $560,000 for all of Brooklyn, according to StreetEasy. In Manhattan, the median sales price for the area above 110th Street was $500,000 last year, and $974,500 in the borough as a whole, the site found.
Resale prices in East Brooklyn — which StreetEasy classifies as Bed-Stuy, Brownsville, Bushwick, Crown Heights and East New York — rose 20.5% from $392,649 in February 2015 to $473,095 in February 2016, according to a recent report from the site, signaling an increase in demand for properties in those neighborhoods.
But there is some relief coming, as StreetEasy predicts that price growth across the boroughs will cool in the next 12 months.
This will give buyers a little more time to find a property this year because, “in just a month’s time prices won’t increase as much as they would have two years ago,” Lightfeldt said.
For affordability, Lightfeldt suggested looking in the far into the outer boroughs, such as in Jamaica and Bayside, Queens. For better a shorter commute, he recommended researching co-ops in Riverdale, a quiet neighborhood in the Bronx that is walking distance from Van Cortlandt Park and a quick ride out of Manhattan via the 1 train.
“It would surprise you how much inventory there is below $600,000,” he said of co-ops in Riverdale.
In terms of condos, Gabby Warshawer, director of research for the listings site CityRealty, said conversions are often a good option for value.
“That doesn’t mean they are bargain basement prices, but they [can be] below the condo average for Manhattan,” she said.
For example, the average prices per square foot in sales so far at the rental conversions 360 Central Park West and Carnegie Park at 200 E. 94th St. were $1,689 and $1,415 as of press time, which are lower than the Manhattan average of $1,894 in the first quarter of 2016, according to CityRealty.
“If you want a Manhattan address, look at these conversion projects,” Warshawer said.