Housing for the 1 percent is out of control.
The median sale price for new luxury homes in Manhattan jumped 72 percent — to $7.85 million — in the last year, up from a mere $4.564 million in the last quarter of 2012.
Real estate experts say the trend will continue because the economy has rebounded, people are more willing to take the plunge now and luxury buyers are bidding up the market.
“Even though the prices have risen, they expect them to rise even more. They are very confident,” said Dottie Herman, president and CEO of Douglas Elliman. “The high-end buyers are the ones who really follow the market. They are real-estate junkies.”
Also, the new homes being built are often bigger with more bedrooms.
The price for the costliest “new development” homes in Manhattan is up 34 percent to $2,661 a square foot over last year, according to the latest quarterly report by the Corcoran Group.
“There is a high demand for large apartments. It has never been more apparent than now,” said Pam Liebman, CEO of Corcoran. “The luxury market has been well served by smart developers who are catering to this niche market — and the trend will continue.”
The luxury market is defined as the top 10 percent of all co-op and condo transactions.
And the high-end niche is not just rich foreigners.
“Now a lot of New Yorkers who live and grew up in co-ops are looking at new luxury condos,” said Diane Ramirez, CEO of Halstead Property.
“In the 1980s, the luxury market was about studios, and one- and two-bedrooms,” she said. “Today the new developments going up have two to five bedrooms and more.”
Corcoran says Manhattan homes listed for $100 million are now a “new market reality.” But the other boroughs also are seeing price booms.
Warburg Realty said prices jumped 20 percent in parts of Brooklyn in 2013 — and a couple of town houses in Long Island City, Queens sold for more than $2 million.
Don’t expect any changes soon, according to industry experts.
“That high-end buyer is still buying and the numbers will only get higher. Everyone is hot on housing,” said Elliman’s Herman. “In 2014 and 2015 we will see total price increases in that market because of all the new development — last year 12.5 percent of inventory was new construction — and new development is nothing cheap.”
The number of sales also increased during the fourth quarter of 2013 compared to the same period in 2012. There were 2,664 recorded fourth-quarter Manhattan apartment sales — 16 percent more than during last year’s comparable period, according to Brown Harris Stevens.