Slow Luxury

By Mary Mullaj

The New York real estate market used to be split in two, with properties priced above and below the $5 million mark performing differently. The ones below the $5 million mark tended to stay on the market longer, while the more expensive properties were snatched up. After the crash on October 10, the opposite became true, with the most expensive residential real estate remaining on the market for longer, and often getting marked down. Last week it was revealed that of properties in the top tier 24 percent of them had been marked down by at least five percent – 145 of them in the past two months, according to New York Magazine. An example of this can be found at 15 Central Park West, where eleven apartments are for sale, five have had their prices cut and 12 more are now for rent.

If the richest echolons might still have plenty of money and are also not mortgage dependant, they might have plenty of other reasons not to buy residential real estate at the moment. Some do not have as much cash available immediately to spend on large purchases, due in part to the market’s performance. Or more likely, the rich are just as psychologically affected by the economic situation as the rest of society. High-end buyers just don’t have confidence right now, even though all but the gloomiest predictors say that the market will probably pick up again by the beginning or middle of next year.