City in Focus: New York Highlights
Spring 2014

New York is a highly desirable city for the ultra-high-net-worth-individual (UHNWI) set. Although London’s significance as a financial centre, its business credentials, and its high standard of living currently put it ahead of the game in terms of its appeal to UHNWIs, the US economy is showing signs of recovery and it seems New York is gaining ground in its political standing and influence on the world economy.

Last month GV secured a Williamsburg
Avenue pied-a-terre for its client.

Property sales in New York were the strongest they had been for six years during the 2nd quarter of last year, having beaten the prediction of a major decline in growth for 2013, say Knight Frank. In the first quarter of 2014, average sales prices in Manhattan, one of the most sought after boroughs in New York, have increased by almost 17% on the previous year, the highest annual increase seen since 2008. There was also a 6.5% rise on the previous quarter, bringing the average sales price in Manhattan to $900,000, according to New York City real estate website StreetEasy. Most of the increase in average sales prices during this period can be attributed to new developments. The prime housing market, which we define as those properties priced over $3m, represents around 13% of the total Manhattan market in terms of numbers of contracts signed, according to StreetEasy. The average price for a new development in Manhattan now stands at around $2m.

In 2014, the New York property market continues to grow and is now stronger than it was in 2007, before the crash. It has proved itself to be resilient and strong, being the last to feel the effect of the crash and the first to bounce back from it. This year the activity in the market has gone way beyond the escalation that usually accompanies the spring warm up. There are a colossal 44 new developments being launched over this period, including both condos and rentals, in neighbourhoods from Inwood to Williamsburg, such as the Woolworth Building, Stella Tower, 30 Park Place’s Four Seasons Private Residences, and Park Avenue South’s Fortress of Glassitude.

However, notwithstanding these new developments, sources seem to agree that supply overall remains low as those with negative equity mortgages bide their time. According to StreetEasy, supply is actually decreasing, with total housing stocks in Manhattan for the first quarter in 2014 falling by 13% on the previous year and by 1% on the previous quarter. These are the lowest stock levels since the end of 2007, so this lack of supply should ensure prices continue to rise, at least for now.

London’s strength in professional services have helped keep it in the top spot. However, it is clear from conversations we have had with leading New York property brokers that as New York becomes ever more important to Europeans, Russians, and South East Asians, it might well steal this much coveted spot from London over the next decade.

• Knight Frank US Insight Report, 2013;
• StreetEasy Market Report, Manhattan Q1 2014;
• NY.curbed.com, The 44 New Developments Hitting The Market This Spring, 18 March 2014.