It’s been five years since New York was crowned as the world’s top financial centre. NYC has since held on to that spot, followed by the likes of London and Hong Kong. However, a recent new development could potentially threaten the Big Apple’s long financial reign.
Million-Dollar Condos Up For Grabs
In New York City’s so-called Billionaire’s Row, Curbed reports how nearly half of the million-dollar condos sold here remain unclaimed. As of May 1, 2019, 48 out of the 60 available units (around 80%) in the luxury tower 111 West 57th Street have not been sold. Meanwhile, real estate appraiser Jonathan Miller estimates that One57 – which has been on the market for seven years now – is still looking for buyers for its 50 apartments.
It should also be noted, however, that One57’s developers themselves have disputed this, stating that One57 is “over 85% sold in units.” In addition to this, it’s estimated that in 100 East 53rd Street, 63 out of the total 93 condo units are still up for grabs. That building’s been on the market for three years now.
There are exceptions, but for most of the luxury towers in the supposedly coveted Billionaire’s Row, it’s mostly the same story as above.
NYC Real Estate Has Always Been Highly Coveted
All of this is despite the fact that in New York, Yoreevo explains that projects usually start selling long before the building is even complete. The article notes how buyers will often “buy off the floor plan,” even with just a rough sense of what the final property will become.
This is certainly not the case now in most of the newly developed properties on Billionaire’s Row. The only exception seems to be 220 Central Park South which was developed by Vornado Realty Trust, where 94 out of 117 condos have either been sold or are in contract.
Sky High Prices Could Spell Disaster
Other than that, most of the buildings here share nearly the same story as the previously mentioned luxury towers. And a lot of this has to do with the staggering price rates the units in these buildings tend to fetch. Luxury apartment developments like 520 Park Avenue, 432 Park Avenue, Central Park Tower, and those mentioned above reportedly sell units for $2 million (€1.8 million) to upwards of $60 million (€53.4 million).
Everything from cosy studio units to multiple bedroom apartments are sold in this price range. Top NYC broker Dolly Lenz blames these sky-high prices for the lack of interest in the luxury sky-high homes.
Although Lenz notes how buyers from all over the world are curious about buying property on Billionaire’s Row, she also explains that they tend to get discouraged due to the extravagant asking prices. “We toured them through the properties but many felt they were too pricey for the market — $7,000 (€6200), $8,000 (€7,100) and $10,000 (€8,900) a square foot.”
Elsewhere in NYC, real estate remains somewhat affordable and highly coveted. New York is still one of the most desirable places to live in the world; it is just that those who can afford the top locations aren’t willing to spend the asking prices.
If the situation on Billionaire’s Row doesn’t change soon, it could spell disaster for most of its developers and cause a housing crisis. As any seasoned real estate broker would say, empty buildings are never good for any city.