Luxury condos escape new dev’s sales pinch

At new condo projects in New York City, a late-spring frost in the form of higher mortgage rates may have dashed the hopes of developers and agents hoping for a verdant selling season.

While luxury condo sales were a bright spot for the new development market in April, most other metrics retreated, according to a Marketproof report. For the first time this year, the average mortgage rate rose to more than 7 seven percent last month.

“Demand may be reaching an equilibrium after several months of upward momentum,” Marketproof CEO Kael Goodman said in a statement. “With limited new inventory and elevated mortgage rates, the new development market has stabilized.”

Although price inflation has stayed elevated, a tepid jobs report last week has already taken some pressure off mortgage rates.

In Manhattan, the number of new contract signings fell to 129 last month, a slight decline from the 134 contracts signed in February, which notched a nearly one-year high. Before the pandemic, the average number of new condo sales in April stood at nearly 160 units. 

The most popular buildings with home buyers were Claremont Hall (8 new contracts; 44 percent sold), a 40-story offering with 197 units developed by L+M Development and Lendlease in Morningside Heights, and the Treadwell (6 new contracts; 23 percent sold) with 66 units across 28 floors by the Zeckendorfs and Dart Interests on the Upper East Side.

The priciest new contract was for a four-bedroom unit at One High Line, asking more than $25 million, or about $5,000 per square foot, by developers Witkoff and Access Industries. The priciest closing was at Vornado’s 220 Central Park South, where a three-bedroom unit closed for $34 million, good for nearly $11,000 per square foot.

Indeed, the luxury market grew where others did not, rising to a 10-month high of 46 sales asking $4 million or more (44 of which were in Manhattan; 2 were in Brooklyn). Extell Development’s 69-story tower on West 66th Street led the way with six newly signed contracts.

In Brooklyn, sales fell to 88 new units last month, declining from 107 new units in March, which marked the highest number of monthly sales since last June. However, contract signings stayed above the month’s pre-pandemic average of just under 80 units per month in the outer borough. 

The most popular buildings among home buyers in Brooklyn were 11 Hoyt Street (5 new deals; 96 percent sold) with 479 new units in Downtown Brooklyn by Tishman Speyer and Vanke, and Elysium (5 new deals; 67 percent sold) with just 12 units in Prospect Lefferts Gardens.

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The priciest contract went for about $2,000 per square foot at 11 Hoyt Street, and the priciest closing was at the Quay Tower in Brooklyn Heights, also for about $2,000 per square foot.

In Queens, home buyers favored Lucent 33 (9 new deals; 38 percent sold) developed by ZD Jasper and Century Development Group with 64 units, and Skyline Tower (6 new deals; 86 percent sold) developed by Chris Jiashu Xu with 880 units, both in Long Island City.

The borough’s priciest closing was a three-bedroom unit at Tangram House West in Flushing for $2.3 million, or $1,375 per square foot, and the biggest contract was for a two-bedroom unit for $1.9 million, or nearly $2,000 per square foot, at Skyline Tower.