Top NYC residences score in 7th consecutive quarter - sale prices for condominiums in desirable areas of New York, New York rise in third quarter of 1992 according to Heller Equities Condominium Price Index: Manhattan

Real Estate Weekly, Dec 16, 1992

Actual sale prices for condominiums in Manhattan's most prestigious areas of Fifth, Madison, Park, Central Park West and Central Park South rose 1.2 percent in the third quarter of 1992, posting an 18.62 percent appreciation overall for the first three quarters of 1992, as measured by the Heller Equities Condominium Price Index: Manhattan.

While the upper-end of the market recorded price increases, other neighborhoods did not fair as well. Upper East Side prices vere down 8.4 percent in the third quarter, posting an 8.32 percent depreciation overall for the first three quarters of 1992, while Upper West Side prices fell 12.3 percent in the third quarter, showing a 19.62 percent drop overall for the first three quarters of 1992.

An analysis of the three neighborhoods over a longer period of time -- since December 1990 -- bears out the same results. For the past seven consecutive quarters, Gold Coast prices increased 28.63 percent. Over the same period, condominiums located on the Upper East Side realized a 13.26 percent price decline and condominiums on the Upper West Side recorded a 10.59 percent price depreciation.

Condominiums located in Manhattan's most prestigious neighborhoods continue to perform well relative to the rest of the market. The variances between the price appreciation for Gold Coast properties and the price decline for Upper East Side and Upper West Side apartments indicates that homes located in the prestigious neighborhoods with historically proven track records of appreciation consistently perform well. It further shows that these homes are protected from the fluctuations that effect the rest of the market.

"Buyers of high-end residences are realizing that homes in select neighborhoods have become 'collector's items' in the sense that there is little room left to build new product, while existing product is always in demand," said Mary Beth Topor, a partner in Heller Macaulay Equities Incorporated. "These conditions drive up prices."

When the Manhattan condominium market is viewed as a whole, i.e. taking into consideration all three neighborhoods, and analyzed for long-term investment potential, the results, as reported in the Investment Table graph of the Heller Equities Condominium Report, are as follows: A typical condominium purchased in Manhattan in 1984 for $500,000 would have earned a steady 5.4 percent per annum return on an equity investment of 20 percent ($100,000).

The Heifer Equities Condominium Report: Manhattan reports a decrease in the number of condominiums sold in the third quarter of 1992: 570 sold, down from 586 sold in the second quarter. However, an analysis of these figures must be viewed in light of the decline in permits, as, together, permits and sales constitute supply and demand. Since there have been no residential permits issued in the last two quarters, demand (as measured by sales) continues to outpace supply (as measured by permits).

A copy of the third quarter 1992 Heifer Equities Condominium Report: Manhattan that includes the Heller Equities Condominium Price Index: Manhattan may be obtained by contacting- Heller Equities, 736 Broadway, New York, New York 10003, Attention: Condominium Reports.