Looks like all those reports of a luxury slowdown weren’t just speculative after all: The final Olshan Realty report of the year is out, and according to the real estate trackers there, “the golden years of new condo development” are over. There was a hefty decline in the number of contracts over $4 million signed in 2016 versus 2015—1,102 contracts versus 1,344, or 18 percent, to be precise.
The number of co-ops that went into contract represented the steepest decline, at 25 percent, while condos made up 76 percent of all contracts signed this year—and more than half of those were in new developments. (No surprises there; 432 Park Avenue, 30 Park Place, and 56 Leonard all began closings this year.)
Some other fun facts from the report (if you consider gawking at the declining fortunes of luxury real estate fun, anyway):
- The total spent on apartments and houses over $4 million this year is a whopping $8,937,866,862. That’s also a decrease from 2015, when the total volume was $10,738,479,892 (sheesh).
- But both the average and the median price of contracts increased from 2015: the numbers are $8,090,463 and $6,367,820, respectively.
- Luxury apartments spent an average of 318 days on the market—which, as Olshan notes, is two months longer than the 2015 average.
- More than 400 contracts were signed solely off of floorplans. (The rich: not like the rest of us!)
- Nearly 50 percent of all luxury sales happened “downtown,” whatever that means.
This slowdown is something experts have been predicting for some time now, so this news isn’t exactly a surprise. But considering the buildings that are likely to begin closings in 2017—more apartments in 30 Park Place, along with high-profile buildings like Annabelle Selldorf’s 42 Crosby Street, Robert A.M. Stern’s 520 Park Avenue, and (possibly, maybe) 111 West 57th Street—there could very well be an uptick in the total dollar amount next year, if not the number of contracts signed.
Still, as Curbed columnist Jonathan Miller has noted in the past, “there’s too much development being built at 2014 prices, and that buyer isn’t there”—so we’ll have to wait and see what 2017 brings.