NEW YORK (
) -- This past spring, Gerard Longo, a property developer and broker based in New York, started seeing evidence that the market was starting to recover. Showings were booked. Potential buyers were lining up. Things were looking good.
"We were doing 30 to 40 appointment showings a week," he says. "That's a lot. Generally that equates to five to 10 offers and will turn into two or three sales. But that didn't happen. We just had all these showings, but no one was buying."
Summer is traditionally a slow month for those in the real estate business. On the heels of a brutal market downturn, Longo was prepared for the worse. If the spring showings yielded few sales, July and August would likely be a bust. But suddenly offers started coming in.
"July and August have probably been the best months of the year," Longo says. "Confidence is building and money is coming back into the market."
The number of homes sold in New York City between May and July was down 36% from the same period a year earlier, according to the real estate database Trulia. While August sales data aren't yet available, some brokers are seeing nascent signs of recovery.
Longo, who has been working in real estate for 28 years, has renovated 500 properties, and developed or consulted on more than 60 condominium projects. He's a principal of Atlantic Walk Vestry, the developer of exclusive properties such as the Fairchild and the Pearline Soap Factory in North Tribeca. Actor James Gandolfini and pop star Justin Timberlake are among the celebrities who call his properties home.
He has seen the peaks and troughs of the real estate market, and he sees some unique factors in the current uptick.
"For a time, you couldn't sell anything over $10 million and the $20 million range was difficult," says Longo, whose Brooklyn real estate firm has overseen more than 7,000 transactions. "Now, that market has come alive again. Why? It's the reduction in pricing, which in some areas is 25%."
Many of the buyers braving the post-bust marketplace are families, many of whom are looking at properties in the $2 million to $6 million range. Unlike single buyers, families tend to consider buying a home a necessity. And they're viewing this time as an opportunity to jump in.
The return of Wall Street money, bonuses in particular, is also sparking sales.
"Unlike the rest of the country, where they look at Wall Street one way, we look at them as our customers," he says. "These are the people we are working with every day --
Longo is predicting that, "September is going to be a blowout month."
Paula Del Nunzio of Brown Harris Stevens, one of the leading real estate brokers in Manhattan, sees steady activity among selective buyers. Of the eight largest residential townhouse sales in New York City, she has represented the sellers of six, including the record sale of the Harkness Mansion for $53 million. She was also involved in the sale of the 27-room Upper East Side mansion of
publisher Bob Guccione for $49 million.
"There is definitely activity at the high end," she said. "It just depends very much upon which buyer is buying the properties they truly adore."
Pop star Madonna, for example, recently bought a townhouse on East 81st St. for more than $30 million. She had spent two years looking for a home with a garage and walled garden.
"It was exactly the property she wanted," Del Nunzio says. "It is a location that many people would not have paid that number for. But she did, and wanted to, because it had what she wanted."
While admitting that sellers "are driving as hard a bargain as they possibly can," she puts little stock in talk of a new frugality that could hurt sales of luxury homes.
"Remember, there were about 5,000 people on Wall Street who got a bonus of $1 million or more, and there were bonuses many times more than them," she adds. "Not everyone is at doom's door."
-- Reported by Joe Mont in Boston
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