Co-op apartments far outnumber condos in New York City – about 268,000 to 112,000, respectively – but at the high end of the market, there’s no question which form of housing is currently on top. According to a new report by the private brokerage Stribling, luxury co-op sales have taken a nose-dive over the past three years while luxury condo sales remain steady, DNAinfo reports.
From 2014 through 2016, luxury co-op sales have plunged by 30 percent, from 209 sales to 148. In that same time span, luxury condo sales have remained steady around 300 per year. A “luxury” apartment is defined as one that costs over $5 million, which must come as crushing news to anyone who just paid $4.9 million for a condo in Tribeca. Another report released by the Real Estate Board of New York found that total co-op sales, including those below $5 million, fell 17 percent — from 503 sales during the last quarter of 2015 to 417 during the same period in 2016. And the average price for a co-op in the neighborhood dropped by 2 percent, to $1,591,000, during that same time period.
Why? What’s wrong with co-ops in the eyes of wealthy buyers? Experts blame co-ops’ cumbersome application process and rules – along with the facts that co-op boards exercise greater control than their condo counterparts, and co-op shareholders own pieces of a corporation while condo unit-owners own actual physical real estate.
And then there’s the simple matter of math. Only 11 new co-ops have been created since 2014 – compared to roughly 630 new condos during that same period, according to the state Attorney General's office. And there’s no sign that the trends will be reversing anytime soon. There have been 29 luxury co-op contracts signed so far in 2017, a drop from the 32 recorded during the same time period last year, according to the Stribling report.
Thinking of buying a co-op or condo? Already bought, and not sure how co-op/condo life and rules work? Learn all about purchasing a place and living in your new community. It's not like renting, and its not like owning a house. What's it like?