Since peaking at 10.5% at the end of 2009, New York City’s unemployment rate has fallen in 10 of the first 11 months of 2010. In November, the city’s unemployment rate decreased to 9.1%, its lowest level 18 months. The local rate continues to recover faster than the nation’s, as unemployment reached 9.8% in the U.S. during November 2010.
Job growth has picked up in New York City, especially in higher-paying sectors. From November 2009 to November 2010, New York City added 51,200 private sector jobs, the largest year-over-year gain in this category since August of 2008. In addition, 14,400 of the jobs gained were in professional and business services and 5,900 jobs in financial activities. This, combined with the continued job growth in education and health services, and leisure and hospitality, has kept New York City’s economic recovery way ahead of schedule.
While in Manhattan the demand for housing has remained strong, supply has declined. The inventory of available units now sits at about 8,100, down from over 9,000 at the beginning of the fourth quarter of 2010. The outlook for future supply continues to decline, as there are virtually no building permits being filed this year. Though November, permits were filed for just 505 new private residential units in Manhattan. This is down 58% from 2009’s first 11 months, and down 95% from 2008’s first 11 months.
While the number of reported apartment sales in the fourth quarter fell 25% compared to a year ago, this figure can be deceiving. After the collapse of Lehman Brothers in September of 2008, sales fell drastically for the following six months. They began to recover in the second quarter of 2009 as the stock market started its incredible run. Many of the closings that would typically have occurred in the second and third quarter of 2009, which are historically the busiest quarters for closings, were pushed back to the fourth quarter. This caused the fourth quarter to have the most closings in 2009, even though the fourth quarter is traditionally the slowest quarter for closings.
The average price for a Manhattan apartment rose for the 6th consecutive quarter, and at $1,432,787 it was 8% higher than a year ago. The median price, which measures the middle of the market, rose 5% over the past year to $840,000, although it was lower than the prior quarter.
Pricing gains were again led by co-ops, whose average price rose 17% from 2009’s fourth quarter to $1,158,333. A leading cause of this gain was an increase in the number of larger co-ops being sold. Two-bedroom and larger co-ops accounted for 45% of co-ops sales in the fourth quarter of 2010, up from 40% a year ago. Studios were the only size of co-ops to post a lower average price, falling 1% to $342,545.
The average condo price of $1,751,219 was 1% higher than a year ago, and is the highest average condo price since the first quarter of 2009. This was despite an 11% decline for the average price for studio condos, which fell to $495,002.