Forbes has released its list of the biggest home sales of the year–and the top five were all in New York City.
It’s been an unusual year for housing, but an even more unusual year for housing in New York. As the rest of the nation saw home prices and values drop, New York’s real estate market stayed stable and strong.
According to ABC News, 2007 was a record-setting real estate year for Manhattan.
- Developer Harry Macklowe bought an entire floor in the Plaza Hotel (except for one apartment) during its conversion to private housing for $60 million, the new top apartment sales record.
- Despite the fact a building’s top floor almost always outprices all other units, Macklowe’s pricey pad cost so much that it pushed the Plaza’s 9,200 square foot penthouse to No. 2 on the top real estate deals list. The penthouse was bought by an unnamed London buyer.
- Former Citigroup chairman Sanford Weill set a new price-per-square foot high this year with his $42.4 million 15 Central Park West buy–which averaged $6,287 per interior square foot.
As more and more banks sheepishly announce writedowns and the subprime mortgage market continues to implode, it may seem unlikely a city known for its financial wealth is seeing property prosper.
But, in New York, despite losses, top executives are still making hefty salaries–and receiving big bonuses, Forbes says.
And those bonuses are thought to be flowing to the real estate market–either directly as down payments or to other expenses, thereby freeing up other cash for new property purchases.
Aside from wealthy Wall Streeters, who else is buying these million-dollar manses?
According to some sources, the world–which may, ironically, may have Wall Street to thank.
"The one benefit to the credit crisis and a slowing economy is that the dollar isn’t going to get stronger against these other currencies," Gregory Heym, chief economist at New York-based real estate brokerage Brown Harris Stevens told Forbes. "Foreign buyers are essentially getting huge discounts."
And, as the International Herald-Tribune reported, residential wasn’t the only big buy in Manhattan this year. Foreign investors spent more in the first three quarters of 2007 on Manhattan commercial properties than in all of 2006, according to New York real estate research company Real Capital Analytics.
So even if Wall Street does start seeing smaller bonuses and paychecks, the real estate industry may have a new source of support–provided U.S. property proves as popular to outside investors in 2008.