Market Overview

            The first quarter of 2007 has broadly been characterized by increased demand for Manhattan property, with slight rises in apartment and townhouse prices.  Sales figures were partially bolstered by lower inventory levels, which developed in the summer of 2006 and abated somewhat by late autumn of last year.  There have also been adjustments in overpriced properties as the market came into greater balance. 
            The NYC economy continues to be strong overall, with job growth and housing starts increasing nicely.  Interest rates (for mortgages) remain relatively low and inflation is under control.  One question is whether the spurt in condominium development resulting in new supply in 2007 and into 2008, will have any appreciable impact on the real estate market.  Thus far the additional inventory has been matched with demand, particularly in the best locations, and where new developments have been branded by top-flight architects/designers.
            The luxury ($5MM+) and ultra-luxury ($20MM+) categories within the NYC real estate market have experienced the strongest performance recently.  In 2006, there were eleven sales in the ultra-luxury market, and several more have already gone into contract this year.  Another strong segment within the real estate market has been on the rental side, where demand has been extremely high and inventory has been unable to support it.  To shore up the dwindling rental inventory, landlords have begun to turn existing long-owned properties into luxury rental buildings.