Manhattan Home Pricing Takes a Dip…And?

Last week data and analytics firm PropertyShark issued its annual Ranking the Priciest U.S. Zip Codes by Closed Home Sales 2021

which highlights the Top 20 and Manhattan was not on the list for the first time.

Although one of the island’s neighborhoods was listed at number 22, and regardless of the huge uptick in velocity of transactions occurring over the last quarter, apparently this huge news worthy of worldwide coverage if you scan the headlines from some wide-ranging media outlets.

“NYC drops out of top 20 most expensive ZIP codes despite ‘skyrocketing’ rents”.

NY Post

“NYC has dropped out of the top 20 of the most expensive zip codes, despite soaring rents”.

Daily Mail UK

“Manhattan just fell off America’s top 20 most expensive ZIP codes.”

Business Insider

And there were many many others that covered this report and according to PropertyShark, “2021 brought another historic first for the East Coast giant: No NYC zip codes ranked among the 20 priciest in the U.S. this year, with the state represented only by the Hamptons at the top of our ranking. Yay Hamptons! At least New York cracked the Top 20 somewhere.

Outside of the obvious “NYC is the center of the universe” sentiment that certainly floats around the little rock I happen to inhabit, what could this mean in the short and long term?

First, this is only one year and doesn’t indicate a trend yet. So much of the home buying that typically makes up the Manhattan real estate transactions activity moved out east to the Hamptons and other areas as a result of the pandemic. However, if this continues for the next three to five years, then we have a different answer.

Second, California has firmly cemented itself as the priciest area in the country with taking 70% of the top zip codes in terms of home prices and this is trend seems to be maintaining its foothold.

Third and something a bit more worth diving into, perhaps the pandemic really has changed the investment interests in terms of how we want to live, work and play. There are underlying structural changes that are no longer conjecture but are happening around us. And with these changes whether immediate or longer term, its essential to look at each of these individual reports no longer as “outliers” but pieces of a greater mosaic.

Finally, just because this particular report from PropertyShark is focused on the priciest of the priciest residential real estate, there will be cascading effects that are not quite known yet.

Though it’s a year away, it will be interesting to see what the annual Ranking the Priciest U.S. Zip Codes by Closed Home Sales 2022 looks like.

Any guesses?