Soaring Manhattan real estate sales could be a mirage
Sale of real estates in the state of Manhattan experienced a rise for the first occasion in over one and a half years, however this rise is unlikely to stay around for long by any means. The sales volumes for Manhattan based real estate grew by about thirteen percent during the second quarter of the year, as per reports made by Miller Samuel and Douglas Elliman. The median price which an apartment sold in Manhattan fetched a record $1.2 million, though the average price of the apartment sales stayed at $2.1 million.
This has been widely welcomed and cheered by real estate developers as well as brokers, as Manhattan real estate sector went from registering losses for six straight financial quarters to registering a positive highlight this year. This is being advertised as a turnaround in terms of sales for the real estate sector of Manhattan. However, the experts in the field are aware that the real cause of the surge in amount of sales is in reality, taxes.
New York launched a new mansion tax on July 1st. This law adds tax between 0.25 percent to 4 percent for sales which are worth $2.5 million or higher. This is why many big money buyers rushed to buy their properties in the second quarter instead of the third quarter and hence save up on taxes. But experts believe that this will come back to bite the real estate sector due to an underperforming third quarter on cards.