Manhattan Condo Prices Surge While Co-op Prices Slide

The recent past has been a wild rollercoaster ride for New York City real estate — the subprime mortgage crisis, fallout from Hurricane Sandy, the COVID-19 pandemic, and recent spikes in interest and mortgage rates, as well as rents.

Through it all, The New York Times reports, the median sale prices for Manhattan condos and co-ops have risen at comparable levels over the past decade — about 9 or 10%.

However, average sale prices tell a very different story.

Unlike medians, average prices are heavily skewed when extremely expensive units are added to the market. As a result, average prices of Manhattan condos were up 15.2% (to around $2.84 million), while co-ops went down 1.3% (to $1.33 million).

Why such a sharp disparity?

“The high-end co-op market has been crushed by the condo market because the new product coming in is different,” says the appraiser Jonathan Miller, author of a report issued by Douglas Elliman analyzing apartment sales in Manhattan from 2015 through 2024. “New development takes the form of condominiums almost exclusively. New condos tend to be larger than existing co-ops, and higher floor level means better views, which means higher sale prices.”

Co-op units, on the other hand, are often in older buildings with fewer amenities. This makes them a more common entry point for first-time buyers because they’re generally less expensive. Meanwhile, condos are luring wealthier buyers with newer construction in taller buildings with higher-end features and added premiums, Miller says. They also tend to have more bedrooms. And in New York City, even a little additional space can be a desirable — and expensive — luxury.

Miller's report makes no mention of the X factor: condo unit-owners don't have to contend with the considerable powers of a co-op board, which controls everything from admissions to sublets to resale prices. Add it all up, and it's not so surprising that the prices people are paying for condos and co-ops are headed in opposite directions.