We believe that 2016 will see an overall softening of the high-end market, driven by an increasingly cautious global macro-economic picture.  Between China’s hard landing, European migrant and economic woes, and increased stock market volatility, it’s going to be a bumpy ride.  That said, the US is always a safe haven for those looking to park their cash and protect it from greater threats.  This will only increase against this global picture.  Further fueling investor inflows into NY is the recently renewed EB5 program that provides a path to a greencard if you invest $500k+ in US real estate.  We believe that the safe haven trend and EB5 program will buttress the high-end real estate market for some time to come, even though it won’t be able to stem the net softening we’re already seeing.

How will this softening manifest in the market? In the same ways we’ve been seeing to date: price decreases at the highest priced segments (and trickling downstream), larger footprints being split up into smaller ones, increased developer concessions, and a longer time on market for these properties.   Again, keep in mind that this ultra high end of the market is decoupled from the averages and medians that drive a vast majority of real estate activity.  In other words: no, we don’t believe that a decrease in asking price from $80MM to $65MM is going to mean much to our readers nor the overall landscape.