The fourth quarter Manhattan market saw the lowest number of sales in six years. The total number of sales were down 12%. The average sales price fell below $2 million for the first time in two years. The luxury market was the weakest segment of all. The average sales price dropped 21%. The inventory in the luxury market grew significantly. The absorption rate ( the number of months of luxury inventory on the market rose from 10 months to 17 months.
Two reasons for the exceptionally weak fourth quarter was the sellers and buyers were waiting to get clarification on the new tax laws. However the biggest reason for the drop in the number of sales was due to the growing inventory in the luxury end of the market which is going to increase further in 2018 with more new development units entering the market. Watch my Manhattan Video 4th quarter report.