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Three Cents Worth: Consuming the Market by Fifths

[This week, our graph guy Jonathan Miller divided the market into five segments to determine where the price movement is. Click on the image to expand.]

After seeing the cool chart in this past weekend's New York Times Key Magazine that segmented the market (using our data) using specific dollar thresholds, I thought I'd divide the market by quintiles and look at the change in median sales price in each segment over the prior year quarter. (Each quintile represents one-fifth of the total number of sales for the given period.)

Underneath these quarterly results was significant change in the volume of activity. We tracked 1,574 sales in 4Q 2005 and 2,441 sales in 4Q 2006, a 55.1% increase. The surge was attributable to the large falloff in the number of sales in 2005 at the end of the housing boom, yet the mix of apartment sizes that sold in the latter quarter were relatively consistent.

The weakness in the market, as measured by median sales price was in the low to mid-million dollar price range. The 4th quintile the only market segment to show a decline in its median sales price (-2.4%). The largest increase in appreciation was found in the 1st quintile (+6.6%). Strength in the entry-level market was perhaps attributable to the slippage of mortgage rates in the second half of 2006.

Currently, price appreciation in the top quintile appears to be the highest. The results of the first quarter will be released shortly after it is compiled at the end of this month.
· Manhattan Co-op/Condo Markets by Quintiles [Miller Samuel]