New York is a great city that has been hollowed out by real-estate speculation – where the conversion of housing to safe-deposit boxes in the sky has pushed out the city’s people and the city’s businesses – who can’t compete with financiers and oligarchs who value property as an investment – rather than as part of the fabric of a city.
But there’s a paradox here: New York real estate is valuable because of the people who want to live there because of the vibrancy of the city — but as the city is choked off from real activity the value of the real-estate begins to fall.
And once the fall starts it accelerates: as with all bubbles a crisis of faith in the market precipitates a panicked sell-off – which deepens the crisis.
That dynamic is playing out in New York today: September 2018 sales volume is down 39% from September 2017 with prices dropping by 9%; for every ten $10m+ home on the market one sells (the ration is actually probably worse — developers are keeping ‘ghost inventory’ off the books to make the figures look better).
There is a ton of super-lux property about to enter the market: 9 skyscrapers this year and 20 more by 2020.