Prices of Luxury Housing Keeps Rising
Any property that is worth $100 million must be something monumental right? After a luxury penthouse condo at 15 Central Park West was sold in 2011 for $88 million to a foreign billionaire, prices of luxury housing in Manhattan have been peaking near the $100 million range. Many brokers believe that prices will soon top $100 million.
Sales for such large amounts of money in Manhattan, Los Angeles, Miami, and other luxury communities around the U.S. have dumbfoundead many real estate experts. Why are some properties selling for eight figures while some housing markets are near rock bottom.
The explanation that many real estate experts agree on is art. One real estate developer based in Long Island compares his West 56th Street penthouse to art and he recently listed it on the market for $100 million. Another real estate expert states that many properties that possess unique architectural properties or some sort of historic importance are being promoted and purchased as art.
A townhome in Manhattan developed by world renowned architect Stanford White was listed at $49 million which was considered a competitive price. Some real estate experts even recognize newly constructed properties as art. Another category of properties that has been known to bring in the big bucks are trophy properties. One apartment at One57 close to Carnegie hall was sold for $90 million and a second apartment in the same building is under contract for $90 million as well.
An art collector purchased a luxury penthouse at the Central Park South Ritz-Carlton for $70 million this June and a co-op on Park Avenue was purchased for $52 million in May. Many brokers and purchasers of luxury housing can relate to the comparison of real estate to art since paintings have sold for over $100 million even throughout the financial hardships.
Not everyone can relate or is pleased by with the comparison of luxury real estate to art. One art consultant was extremely upset with the analogy and stated that there is no grounds to this comparison and argues that they’re completely different. He states that there are no collation between these two since art can be moved and is more unique since it cannot be duplicated. He also makes the point that art holds more equity and that valuing art is a more intricate process.
One president of a real estate appraisal firm states that when buyers and sellers refer to properties as art, they are placing value on the beauty that cannot be reproduced. Real estate in London, New York, Miami, and Los Angeles have all been bit with this bug and real estate prices have soared ever since. Many in the real estate market have continued to refer to properties as art but how long do you think this trend will last?