In 2020, We Hope To Sled Down The Housing Market

Admittedly, I haven’t fully exited holiday mode and am more focused on stuff like this (except that mega Manhattan market report release thing later down the page).

But I digress…

Manhattan’s Real Estate Success Is Highly Leveraged On The High End

I’ve been the author of the expanding Elliman Report series for Douglas Elliman Real Estate over the past 25 years.

I’ve long said that the optics of the market tend to be through a $100 million new condo. The results presented this quarter should help reorient Housing Note readers to the proper context.

Let’s start with a breakdown of Manhattan 4Q19 sales:

It should be noted that only 4.4% of all sales in 4Q19 were sold at/above $5 million and therefore sales below $5 million accounted for 95.6% of the Manhattan market. Sales above the $5 million threshold fell 37.6% YOY and sales below $5 million rose 1.6%. Two completely different patterns are very apparent.

I’m not laying on some flowery prose about the market here but 95.6% of the market saw a 1.6% increase in sales and 4.4% of the market saw a 37.6% drop in sales. How would you describe it?

The real issue to the real estate industry is that the super-luxury prices of the top 4.4% represent a significant dollar volume in the market. Total market volume was $4.4 billion this quarter and the top 4.4% of sales accounted for 30% of those total dollars. So yes, based on dollar volume, the drop in high-end sales activity is a big deal.

Elliman Report: Sales: Q4-2019 Manhattan Sales – Prices Flat to Sliding

The Bloomberg story using our 4Q19 Elliman Report results was ranked 9th most read worldwide (350K Bloomberg Terminal subscribers) before 9 am so with all the other big headlines today, I’d say interest in real estate hasn’t waned.

There are a bunch of great articles on the state of the market in the links at the bottom of the page. Be sure to check them out.

And then there is the chart:

Notice the Mansion Tax flip flop in Q2 qnd Q3 of 2019. Just noise.

Q4-2019 Elliman Report: Manhattan Sales [Elliman]

Q4-2019 Elliman Report: Northern Manhattan Sales [Elliman]

Here are some key points:


Co-ops & Condos
“Overall sales below the $5 million threshold edged higher while sales at or above the threshold fell sharply.”

– The number of sales fell annually for the eighth time in nine quarters
– Median sales price unchanged year over year as average sales price continued to decline
– The lowest overall share of quarterly cash buyers in five years of recording
– The hardest-hit segment in terms of sales has from $7 million to $10 million
– Four out of ten luxury sales were new development versus six out of ten three years ago
– The sharp gain in luxury listing inventory continued with resales contributing the most significant portion
– Smallest new development average square footage of a sale in seven years
– The third straight annual increase in new development sales market share but remained below decade quarterly average


“Price trend indicators by property type continued to slide.”

Co-ops & Condos
– Median sales price declined year over year for the third time in four quarters
– The number of sales expanded annually for the second time in three quarters

– Price trend indicators and the number of sales declined from the year-ago quarter
– Listing inventory hasn’t shown a year over year decline in seven quarters

Getting Graphic


(For earlier appraisal industry commentary, visit my old clunky REIC site.)

It’s still the holidays in Appraiserville.

More Miles Than An Uber Driver

You’ll note that in the comments of the tweet, as a Manhattan appraiser, I’ve never driven my car to any of my 8,000 appraisals during my career.

OFT (One Final Thought)

Marketing on steroids…

I learned to drive a stick in my friend’s yellow VW Beetle in a hilly neighborhood in the late 1970s. We both survived and I have largely preferred driving a stick ever since. I loved that moment but never wanted to actually own a Bug. Nostalgia aside, it felt like a death trap, but I still retained fond memories of the car.

I highly recommend a documentary on the VW Beetle called: The Bug.

VW marked the discontinuation of their Beetle in this video on New Year’s Eve.

Brilliant Idea #1

If you need something rock solid in your life (particularly on Friday afternoons) and someone forwarded this to you, or you think you already subscribed, sign up here for these weekly Housing Notes. And be sure to share with a friend or colleague if you enjoy them because:

– They’ll drive a stick;
– You’ll like to sled;
– And deal with the oversupply at the top.

Brilliant Idea #2

You’re obviously full of insights and ideas as a reader of Housing Notes. I appreciate every email I receive and it helps me craft the next week’s Housing Note.

See you next week.

Jonathan J. Miller, CRP, CRE, Member of RAC
Miller Samuel Inc.
Real Estate Appraisers & Consultants
Matrix Blog

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