NEW YORK (TheStreet) --Real estate prices in New York City's most densely populated borough of Manhattan dropped 20% in the third-quarter, compared to this time last year. CNBC's wealth editor Robert Franck joined Tuesday afternoon's "Closing Bell" to provide further details on the decline.
"Wealthy buyers are pulling back their spending and new luxury condo towers are piling up unsold throughout the city," Frank said.
During the 2016 third-quarter there were 3,000 sales, which was lower than the 3,600 sales from last year's third-quarter, according to a new report from Douglas Elliman and Miller Samuel.
The number of properties for sale also escalated, as did the amount of time it took for a property to sell. Equating to the current six-month supply of inventory, Frank noted.
"Bidding wars are fading, and discounts are more common. Discounts being a relative term in a city where the sale price is still $2,032,000. The biggest declines are at the very top right now especially those trophy apartments in those brand new condo towers," he explained.
New developments inventories rose 27% in the quarter, and that number is growing 2.5 times faster than the inventory of resale apartments, Frank said.
Despite the decreasing real estate figures, Frank says it's likely to get worse.
"The third-quarter results were artificially inflated by sales of new apartments that actually went to contract during the good times of 2013 and 2014, but they're only closing now because the buildings are being finished," he added.