With fewer than 300 sales in any calendar year, townhouses represent one of the most fascinating niche segments of Manhattan’s residential real estate market. The Corcoran Group’s 2016 Townhouse Report surveys sales of single-family and multi-residence townhouses throughout the borough of Manhattan.
Among its findings:
- Fewer sales. The number of townhouses sold fell by 26% versus 2015.
- Lower prices. After last year’s record-breaking levels, a slower pace at the high end caused prices to cool by 10% in price per square foot.
- Townhouses go for $1M minimum. For the first time, no Manhattan townhouse sold for less than $1 million unless it was a gut renovation.
- Fewer trophy sales. No townhouses sold over the $30 million mark in 2016.
Uptown remained the dominant neighborhood for townhouse sales with 42% of transactions, up from 39% last year. East and West Side market shares also went up. Downtown drew nearly half the number of buyers as in 2015, resulting in its market share of sales shrinking from 27% last year to 19% this year.
More specifically, West Side single-family townhouse sales rose 13%. However, the average price decreased by a steep 32% as median price fell in tandem by 30%. Additionally, of the 18 total sales on the West Side, only 2 sales hit the $10M threshold.
The Downtown single-family townhouse sales dropped precipitously — 20 in 2016 versus 39 in 2015, or a 49% drop. Although there was a significant drop of in the number of sales, the average price per square foot decreased by only 3%. Maybe this number should have been larger to clear some of the townhouse inventory in 2016. Clearly, the sellers and agents of these townhouses are reticent to reduce the price because they believe the neighborhood and associated long-term value will bring buyers back to the Downtown townhouses.
Even the luxury townhouse market wasn’t immune from market weakness as the price per square foot dropped by 11%. It’s important to note that 2015 was a record year, so the 2016 comparison, although weaker, is being compared against the all-time highs. 2017 should be a strong market as deregulation and tax reform boost bank and stock market profits, which will translate into more purchasing power when it comes to Manhattan real estate purchases.