Still Skating in New York

posted on August 23rd, 2008 filed under: Real Estate News

One of the remarkable things about the housing bust is that real estate is doing fine in the nerve center of madcap finance: New York.  Take, for example, the price action in several local markets in southern Westchester County.  These are close-in suburbs of New York City.  As the chart below demonstrates, these bedroom communities to the world’s financial capital appear to be skating along without experiencing the devaluation that has enveloped so many other places.

One possible explanation is that dollar devaluation attracted foreign investment in Manhattan real estate, thus propping up the buying power of young couples who often sell Manhattan apartments and move to Westchester after starting a family.  It’s worth noting that the Manhattan market may have rough sledding ahead.  Fund manager Ken Heebner called a top in Manhattan real estate about a year ago.  If he proves right, that could pressure the Westchester market.  On the other hand, in the early ’90s, when Manhattan fell by 25% to 50%, Westchester basically went sideways, with only minor dips.

The chart shows median prices per square foot from 2000 to 2008 in Larchmont, Bronxville, the Bronxville P.O. area of Yonkers, and Edgemont.  Please note the data ranges in price and elementary schools.  Keep in mind that the data for 2008 represent a partial year, until August.  Somewhat lower prices per square foot are often registered toward the end of the year, so the final ’08 numbers are likely to be a bit lower.

This is not a recommendation to buy in these areas, just an observation that prices have not fallen in the NY ‘burbs the way prices have fallen elsewhere.

Chart.MedianPricePerSF.SWstchstr

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posted by // This entry was posted on Saturday, August 23rd, 2008 at 6:34 pm and is filed under Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed.

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