Real Estate Articles

Buying Expensive Real Estate: New York and Los Angeles

US most expensive real estate is located in New York City and Los Angeles. A considerable part of the two cities is inhabited by movie- and pop-stars who are always interested in buying expensive real estate priced above $10 million. Luxury real estate prices are almost reluctant to bank rates and general market situation. According to many real estate agents working in Manhattan, the majority of those spending about $10 million on real estate pay cash. Growing bank rates may impose impacts on their business or incomes but not on buying properties.

After the depression in this sector taking place from 2000 to 2002 demand started growing immensely within the last two years. The growing demand brought 20 – 30 percent increase in prices, as well as the deficit of supply. Yet couple of years ago to sell a property for $5 million was a rare thing, but now deals involving $12 - $15 million do not seem to be surprising any more. Prices in this sector are really astronomical. Most of the buyers already own properties on other parts of the world and feel almost obliged to purchase some good one in New York City, even if the place will never be their domicile.

Sales of expensive cooperative apartments have been quite popular recently. According to Stribling & Associates Private Brokerage, there were successful 13 deals of about $10 million each in Manhattan during the first half of 2004, while there just 8 during the entire 2000.

Deficit of very expensive cooperative apartments made for rising prices for posh townhouses. In the first half of the year most of the townhouses were priced between $4 million and $10 million. About 27% of all townhouses sold for more than four million dollars were located in Lower Manhattan. Rich buyers give preferences to popular district of Soho, Flatiron, Greenwich Village and Tribeca. People move here even from Fifth Avenue and Park Avenue. This happens due to the infrastructure development in Lower Manhattan. The quality of life here is not lower than in traditionally prestigious areas, but the architectural diversity is a lot greater.

As for suburbs of Los Angeles, prices are highest in Bel Air, Beverly Hills, Santa Monica and Malibu. Houses in Santa Monica used to be prices under $3 million, while now they are well sold at about $4 million.

To be continued...

Author: Cameron Lindblom

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