Townhouse Prices Bounce Back Partly

Publication:

Crain's New York Business

Published On:

10/27/2010

Press Mention:

Publication: Crain’s New York Business
Date: 10/27/2010 

Both sales volumes and prices pick up smartly in third quarter, versus a year earlier, but both also remain far below peaks of 2008.

The Manhattan townhouse market continued its rebound during the third quarter, but both the volume of sales and their prices are still well below peak levels.

The average price for a townhouse hit $6.6 million in the third quarter, up nearly 18% from the same period of last year. Prices rose in all neighborhoods across Manhattan, with the biggest increases logged on the West Side, where the average price rocketed 42% to $5.9 million.

“Prices are up significantly across Manhattan,” said Lisa Fitzig, who recently partnered with Tom Wexler, Leslie J. Garfield’s director of townhouses, to focus on this segment of the market. “But we are not back to the hype that we had a number of years ago.”

In fact, despite the hefty uptick in Manhattan as a whole, prices are still well below the peak levels reached in the first quarter of 2008. Back then, 98 townhouses sold for an average of nearly $7.5 million.

On the East Side, average prices in the third quarter climbed to $8.1 million, up just 7% from last year. That price was also just half the $16 million peak in average prices set in the third and fourth quarters of 2008. The third-quarter figure also got a big boost from the sale of The Duke Semans Mansion, a 19,500-square-foot, landmarked townhouse located at 1009 Fifth Ave. The home, which faces the Metropolitan Museum of Art, sold for $44 million, 12% less than the listing price, in July.

During the third quarter, 55 townhouses changed hands. That compares to 49 during the same quarter last year. That number is also way below the peak of 98 transactions during the first quarter of 2008. However, there were more than 10 transactions not included in the data because the deals closed after Sept. 15.

“People still have concerns about the economy, but the real estate market in Manhattan has shown some resiliency this year,” Ms. Fitzig said.

Townhouse inventory is also still fairly scarce, and with the holidays, activity may slow. Additionally, Mr. Wexler said there are still a lot of townhouse owners who are watching the market and sitting on the sidelines, either waiting to put their property on the market or buy.

“The townhouse market is very cyclical,” Mr. Wexler said. “Heading into the winter and the holidays, we traditionally do not see more houses come on the market.”