Report: Most residential sales below $500,000

Real Estate Weekly, Jan 2, 2002 by Parke Chapman

Residential real estate in Manhattan is still hot, but the hottest properties are priced below half a million dollars.

Corcoran Group data shows that 56 percent of the total deals done in November involved less than $500,000 changing hands. Corcoran's data also tracked an increase in sales activity for November that exceeded the number of deals made in November of 2000. Another report issued revealed a 129 percent increase in the number of units for sale. The increase was gauged between the last week of November this year and the same week in 2000. Also, 122% of listings went down in price between the two periods.

"This data can be explained by the increase in buyers who have decided to forego renting in favor of buying," said Barbara Corcoran, chairman of the Corcoran Group.

Last week, Corcoran summed up the residential market as "fear driven" after the Sept. 11 attacks, leading many buyers to sell their apartments before buying a new one. Prior to Sept. 11, said Corcoran, this practice was rare. "Buying versus renting makes sense, especially for younger buyers, as prices are lower and mortgage rates are the lowest they've been in 40 years," she added.

Clearly, the sour economy is another reason why buyers are seeking less expensive units. And a drop in prices has likely cut prices on many units, pushing them below the $500,000 ceiling.