Manhattan Dominates with 60% Market Share as New Condo Sales Soar Despite Higher Rates

In June, Manhattan demonstrated significant strength in the real estate market, contrasting with a decline in Brooklyn. New development sales in Manhattan maintained a fifth consecutive month above pre-pandemic levels, even with high-interest rates and a softer luxury market. Manhattan captured over 60% of market share for new development sales, the highest since 2018, indicating robust performance despite reduced inventory.

Steady Demand Despite Rate Hikes

Buyers signed 151 contracts for development units in Manhattan, an 8% decrease from the previous month and 5% below the previous June's levels. Despite increased mortgage rates, demand remained as strong as pre-pandemic levels. For every three new development units introduced, four contracts were signed, underscoring the borough's resilience.

Luxury Market and Top Selling Buildings

While the luxury market saw a 30% decline in June, new development sales in Manhattan remained stable. Notable buildings included Midtown and Lenox Hill's 520 Fifth Avenue with 27 new contracts, and Treadwell with eight. Even as luxury signings fell 28%, high-profile sales continued, such as a $115 million apartment at Central Park Tower and a $24 million unit at Giorgio Armani Residences.

Upper Manhattan's Unexpected Performance

Upper Manhattan outperformed Lower Manhattan in price per square foot, driven by sales at the Vandewater and Claremont Hall. This trend is attributed to the declining supply of Manhattan apartments, particularly those priced below $3 million, while the market remains saturated with studios and high-end units.

Brooklyn's Declining Sales

Contrasting Manhattan, Brooklyn experienced a 35% drop in new contracts compared to last June. The luxury segment saw no new development contracts close, though Hudson Companies managed to put three units into contract at 1 Clinton Street. Overall, new contract signings fell from 93 in May to 66 in June.

Queens' Stability in Long Island City

Queens, particularly Long Island City, remained a desirable location. Chris Jiashu Xu’s Skyline Tower saw six new contracts, continuing its strong sales trajectory with nearly 90% of its 800 units sold over the past five years.

Future Market Outlook

As supply diminishes in Manhattan, the market anticipates the next building cycle. Apartments with one or two bedrooms priced under $3 million are in short supply, while studios and luxury units are more abundant. Brooklyn’s market showed signs of oversupply and reduced activity, contrasting with Queens' stable performance in specific high-demand areas.