Manhattan real estate news contributor Ron Insana warned that New York City's real estate market was about to crash. He claimed that while the Manhattan skyline was filled with construction, reflecting a building boom but it was all for high end condominiums.
The Wall Street book author stated that despite the positive view of builders, there was a serious risk, in his opinion, that the supply of mostly expensive new properties in New York may outstrip demand for many years to come, according to a report by News Max. He said that it was ironic that New York City mostly escaped the property slump that engulfed the global market in 2008, despite being the center of mortgage credit issues.
The Manhattan real estate aftershock from the national market crash was worse than the earthquake that destroyed the nation itself, according to Insana. He said that if the market would continue to see steep discounts in the city's tallest buildings, it will still not be able to account for the multi-million dollar apartments. However, he said that money can be made by shorting these entities most visible to an edifice that will likely get wrecked.
As an example, he cited the lack of attention surrounding the tallest residential structure in the Western Hemisphere, situated at 432 Park Avenue in New York City. He explained that only 13 properties had closed out of 141. Granted these sales brought in $170 million to the developers, it still raised questions about whether or not the New York real estate market had dropped both literally and figuratively.
The Manhattan real estate market saw some 5,377 new luxury condo units constructed at a time when foreign buyers were either backing away from high-end purchases or buying affordable residences, according to a report by CNBC. Thanks to the strength of the dollar, it has made most expensive New York apartments even more costly.
