Both prices and statistics continue to climb in the housing market for Manhattan. The number of people demanding dwellings within the city is high and space is limited, resulting in inflated prices and rampant success for the housing market. An article completed recently by CNNMoney detailed the issue and offered some possible explanations.
The average price for a home in the United States is just over two hundred thousand. However, in Manhattan, condos are selling, on average, at just short of one million dollars. Space is an issue as well. For almost a million in Indianapolis, the consumer can buy a three or four bedroom home of approximately seven thousand square feet. In Manhattan, the same amount of money comes with one bedroom, totaling in at less than one thousand square feet.
Despite this inflated cost, prices and sales only continue to be on the rise. According to brokers with Halstead Property and Corcoran Group, prices went up by almost twenty percent in the first quarter alone. Sales still held strong, accelerating a further twenty five percent. Fellow affiliates believe this will continue; Jonathon Miller speculates the second quarter of 2014 may match the 1.025 million dollar record set in 2008.
However, this frantic success has invoked a vicious cycle. Most houses are bought at or above the asking price, which only serves to engage bidding wars and spike the average cost of a home higher. Furthermore, this has caused a shortage of inventory in the city. Only three hundred and sixty seven of the units sold in the first quarter were newly constructed apartments.
As a result, surrounding communities are being affected. Families that attempt and fail to buy three or four bedroom apartments reside themselves to living in New Jersey or Long Island. Those who lose a bidding war are flooding Brooklyn; King County is now the fastest growing county in New York state. Once again, with this, come complications; as of the end of 2013, the price of a home in Brooklyn had increased approximately eleven percent to approximately five hundred and seventy thousand dollars.