[Today, our chartman Jonathan Miller breaks down the increase in Manhattan apartment inventory by condos and co-ops. Click on the image to exand.]
One of the primary instigators of the housing slowdown, besides mortgage rates, has been the addition of inventory to the market at a pace that cannot be absorbed by the demand. This swelling inventory corresponds with a sharp increase in condo supply over the last few years.
Conventional wisdom says there should be more co-op listings than there are condo listings. This is logical since the ratio of owner occupied housing stock is about 75% co-op to 25% condo. This summer, however, co-op inventory actually eased a bit while condo inventory climbed. In fact, the ascent of condo inventory has been steeper than co-op inventory since the peak of the housing boom, which I estimate as late 2004 or the beginning of 2005. Since the end of 2004 through the end of August 2006, co-op inventory climbed 50% and condo inventory climbed 143%, a significant disparity.
Prior to 2005, condo inventory had been fairly consistent, ranging from 1,500 to 2,000 units on the market at any one time, suggesting that new supply was readily absorbed. Co-op inventory has been much more volatile without new development activity adding to the housing stock. I am not fully clear on why that is. Perhaps new condo development pulled buyers from co-ops from mid-2002 to mid-2003, causing co-op inventory to spike.
· Manhattan Coop/Cono Listing Inventory (Exclusives) [Miller Samuel]