By Jeffrey Jackson
Published November 11, 2008

Manhattan Apartments Decline in Value, Crisis Hits Home for New Yorkers-  Where Wall Street Meets Main Street.

  NEW YORK, NY - November 11, 2008 - Mitchell, Maxwell & Jackson, Inc. (MMJ) given the unprecedented events of the past 2 months we find it necessary to provide an interim update on the state of the Manhattan housing market. Declining prices, 10-15% per annum, are now clearly broad based and affecting all neighborhoods. We have examined the data and broken it down into two sets. Firstly, the closed sales and secondly, the current pending deals and listings.  These are our findings based on the closed sales data as reported by The Real Estate Board of New York (REBNY):

 - Market conditions have been weakening since the sub-prime crisis began in the summer of 2007.  Effects were generally contained to the tertiary sectors of the market until 2008.
- In March '08, the weakness expanded into the broader markets. Lenders tightened their underwriting criteria and demand for apartments slackened.
- Average apartment price is down 8.8% since 1Q08. The 3Q08 average was $1,415,000 versus $1,552,000 for 1Q08.
- There were 4,019 closed apartment sales in the first quarter of '08 and 3,664 in the 3rd quarter, also down 8.8%.
- The median price of a Manhattan apartment peaked at $920,000 in the second quarter and fell 8.2% to $845,000 in the third quarter.

  The current data, pending trades and listings, are the best real time indicators; however they are much more difficult to track.  MMJ has amassed a statistically significant sample (over 200 contracts since September 1) from which we are able to draw the following conclusions:

- Market conditions have deteriorated further.  Sales volume (contracts) during September/October was off by approximately 75% versus same period 2007.
- Numerous deals negotiated pre-September have been re-traded and at lower levels.
- Inventory levels are ballooning as absorption of new developments drops off.
- Job losses in the financial services sector are widespread (estimated to reach 140,000 by year end) and expected to continue.
- Rental rates are also declining.
- Overall Demand for housing is declining<.br>
         In conclusion, the most current data indicate that prices have declined at 10-15% per annum from 03/08 levels.  Additionally, current trades are now occurring at levels equal to the first half of 2006.

 About MMJ & the Market Measure: Mitchell Maxwell & Jackson, Inc. is New York's largest residential real estate appraisal company. The Market Measure reports periodic sales activity of specific property types within established geographic parameters of New York City. With New York's largest residential sales database, the report shows changes in the market by size, location and price range. Quarterly and additional reports can be found on the company website at www.mmja.com

    Contact:
Jeffrey Jackson
Mitchell, Maxwell & Jackson Inc.
212-319-7300 x 202
jj@mmja.com
www.mmja.com

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