IN the summer of 2007, Kirk Henckels, a broker of high-end homes, was crowing about the record-setting sales of trophy co-ops and town houses on the Upper East Side, with several sales topping $50 million.He said, “$50 million is the new $30 million — somehow $40 million was skipped.” Now Mr. Henckels, the director of private brokerage for Stribling & Associates and the author of a report on the luxury market, says that in this economy deal-making at the upper end has all but come to a halt. Sellers are uncertain of the market, he said, and buyers are unwilling to commit to what could be seen as ostentatious purchases. Now $20 million is the new $40 million, he said.
By Josh Barbanel, Dec 21, 2008, NYT
Sales under $5 million are continuing — after all, people have to live somewhere — with prices off about 15 percent, Mr. Henckels said. But at higher price points, there are so few sales that no one can gauge the loss in apartment and town house values. Inventories are rising but remain far below the levels of the early 1990s.
For a long time, Mr. Henckels said, the luxury market supported the rest of the real estate market. Now “it would be apparent that the lower end is supporting it.”
“The trophy buyers are not in the market right now,” he said. “They are looking, but not buying.”