New York’s luxury real-estate market is crashing

New York is a great city that has been hollowed out by real-estate speculation, where the conversion of housing to safe-deposit boxes in the sky has pushed out the city’s people and the city’s businesses, who can’t compete with financiers and oligarchs who value property as an investment, rather than as part of the fabric of a city. But there’s a paradox here: New York real estate is valuable because of the people who want to live there because of the

vibrancy of the city — but as the city is choked off from real activity, the value of the real-estate begins to fall. And once the fall starts, it accelerates: as with all bubbles, a crisis of faith in the market precipitates a panicked sell-off, which deepens the crisis. That dynamic is playing out in New York today: September 2018 sales volume is down 39% from September 2017, with prices dropping by 9%; for every ten $10m+ home on the market, one sells (the ration is actually probably worse — developers are keeping “ghost inventory” off the books to make the figures look better). There is a ton of super-lux property about to enter the market: 9 skyscrapers this year, and 20 more by 2020.