Most real estate markets in the US are reeling from the latest figures that show house sales plummeted in July but the residential market in New York is bucking the national trend.
With mortgage rates and property prices at historic lows, the city’s more affluent residents are cashing in to buy at bargain prices, according to agents who are reporting a surge in activity in private home sales in recent months.
‘Right now we are actually experiencing a pretty strong market. A lot of activity, a lot of signing contracts,’ said Pamela Liebman, chief executive officer of The Corcoran Group, New York’s largest residential real estate agency.
New York City saw prices drop an average of 20% at the height of the recession and sales volumes were extremely low in 2008 and 2009. But while prices and transactions remain flat nationwide New York apartment sales have increased by 82% in the second quarter of 2010 compared to the same period last year.
A report from the Real Estate Board of New York (REBNY) also showed a 72% jump in the total value of house sales to $7.6 billion in the same period and the average price per square foot stands at $1,061 dollars.
The upbeat market is said to be due to high earnings and bonuses returning to the city’s financial district. ‘We are lucky in New York because Wall Street has been doing so well in the past year and a half and this money is holding the market somewhat stable,’ said Michael Moskowitz, chief executive officer of Equity Now, a Manhattan based mortgage lender. There are also more foreign buyers looking for bargains in New York.
The overall confidence in the US real estate market though is low. The August Macro Markets home price expectations survey which questions economists, real estate experts, investment experts and market strategists, says property price falls are expected for the rest of the year with cumulative negative activity likely into 2012 and beyond.
‘For the third consecutive month, the consensus from the experts indicates weakened overall confidence in the US housing recovery, with only 21% of our panelists now predicting positive growth in prices nationwide for 2010, and average expected cumulative price appreciation through 2014 falling almost one third since our inaugural survey just three months ago,’ said Robert Shiller, MacroMarkets co-founder and chief economist.