Have you ever walked past a gleaming high-rise on Billionaires’ Row and wondered who on earth can actually afford to live there anymore?
I did exactly that the other day on West 57th Street. The building looked as stunning as ever—glass curtain walls catching the late-afternoon sun—but something felt off. Half the “For Sale” signs I remembered from two years ago were still there. Some had fresh stickers slapped across them: “Price Improved.” Translation? The owner just took another six-figure haircut.
Turns out my gut feeling wasn’t wrong. Manhattan’s condo market has quietly been sliding for the better part of a decade, and 2025 is delivering the clearest evidence yet.
A Decade-Long Slide Nobody Saw Coming
Let’s start with the number that made me stop in my tracks: back in late 2015, the average price per square foot for a Manhattan condo or co-op hovered around $1,562. Fast-forward to fall 2025, and that same square foot now costs about $1,108. That’s a drop of nearly 30% in ten years—in a borough everyone still calls the global capital of real estate.
Think about that for a second. While stock markets tripled and tech salaries exploded, owning a piece of Manhattan actually became cheaper in nominal dollars. Adjusted for inflation? The loss is even uglier.
And it gets worse for sellers right now. From mid-2024 to mid-2025, roughly one in every three condos that changed hands sold for less than the owner originally paid. In some buildings on the Upper East Side and in new developments south of 42nd Street, the loss rate climbs closer to 50%.
“People are stunned when they run the numbers. They bought at the peak in 2016 or 2017, held through Covid, and now discover they’re underwater by $400,000 or more.”
– Veteran Manhattan broker, speaking anonymously
Why Buying Feels Impossible Even for the “Rich”
Let’s crunch what a “median” purchase actually looks like today.
The typical Manhattan condo that sold in recent months went for around $1.65 million. Put 20% down—$330,000 in cash, which already eliminates most millennials and many Gen-X buyers—and you’re left financing $1.32 million.
At current rates around 6.25% on a 30-year fixed (and good luck getting lower without buying points), your principal and interest payment alone comes to roughly $8,120 a month. Then tack on:
- Common charges & property taxes: $3,000–$4,500
- Mansion tax, transfer taxes, sponsor fees (if new development): already paid upfront
- Potential special assessments for building repairs
Suddenly you’re staring at a monthly nut north of $12,000 before you’ve bought a single piece of furniture. And that assumes you somehow qualified for the mortgage in the first place—banks are brutal on debt-to-income ratios when rates are this high.
Now compare that to the median Manhattan rent of $4,973. Painful? Absolutely. But it’s still less than half the carrying cost of ownership. No wonder even households earning $400k–$600k are choosing to rent “temporarily”… for the fifth year in a row.
Where Did All the Foreign Buyers Go?
Remember 2014–2016 when every closing felt like an international summit? Russian oligarchs, Chinese industrialists, Brazilian heirs, Middle Eastern royals—cash tumbling in faster than sponsors could pour concrete.
That tap has slowed to a trickle. A stronger dollar makes Manhattan look wildly expensive to European and South American buyers. Capital controls in China never really went away. And many of the traditional “safe-haven” buyers already own two or three apartments they barely use.
In my experience walking open houses these days, the crowds are almost entirely domestic—usually New Yorkers trading up, down, or sideways. The mystery bidder from Dubai who drops 30% above ask in all cash? Urban legend in 2025.
The Rent Rocket Nobody Can Defuse
So if buying is broken, why aren’t landlords slashing rents to fill all these empty condos hitting the rental market?
Simple: demand is still insane.
- Young professionals who gave up on buying
- Empty-nesters downsizing from Westchester or the suburbs
- Tech and finance workers on two-year assignments
- Divorcing executives who need a place to land fast
All of them are competing for the same relatively fixed pool of luxury apartments. Add in the fact that new construction slowed dramatically after 2019 (thanks to zoning fights and high interest rates), and you get the perfect recipe for rent inflation.
“Every time a condo owner loses hope and puts their unit up for rent instead of sale, they discover they can get $20–$25 per square foot per month. That often covers their entire carrying cost and then some. Why sell at a loss when you can break even—or profit—by renting?”
– Upper East Side landlord with three rental condos
The Political Wild Card Looming Over Everything
New York’s new political reality is about to make this disconnect even sharper.
Talk of freezing rents on the city’s roughly one million rent-stabilized units is gaining serious traction. Landlords of those buildings will inevitably look for ways to recoup revenue elsewhere. Guess where that pressure flows? Straight to the 1.2 million market-rate apartments—including virtually every luxury condo rental.
Higher real estate taxes, new transfer taxes, potential vacancy taxes—every proposal aimed at “making the rich pay their fair share” ultimately lands on the shoulders of tenants paying market rent. I’ve already seen buildings where monthly charges jumped 18% in a single year to cover rising taxes and insurance.
What Happens Next? Three Scenarios I’m Watching
Nobody has a crystal ball, but here are the three paths that seem most plausible right now.
- Rates drop hard in 2026–2027 → Suddenly that $8,000 mortgage payment falls to $6,000 or less. Buyers flood back in, prices stabilize, and the decade-long slide ends.
- Stagnation drags on → Rates stay “higher for longer,” foreign money never returns in size, and Manhattan slowly turns into more of a renter’s city like London or Hong Kong.
- Policy shock → Aggressive new taxes or rent regulation on luxury units triggers a wave of condo owners dumping inventory at once, pushing prices down another 15–20% before bottoming.
My personal bet? Some combination of 1 and 2. The fundamentals of New York—jobs, culture, energy—aren’t going anywhere. But the era of Manhattan real estate as the world’s most bulletproof investment is clearly over, maybe for a generation.
In the meantime, if you’re lucky enough to have the cash and the stomach for it, there are genuine bargains hiding in plain sight. Just don’t expect your broker to advertise the fact that the seller is bleeding. In this market, discretion is the better part of profit.
So next time you’re sipping an overpriced cortado in SoHo and someone complains about rent, nod sympathetically. Then remember: at least they’re not the ones writing an $8,000 check every month just for the privilege of watching their net worth shrink.
Welcome to Manhattan real estate, 2025 edition. Beautiful, brutal, and—against all odds—still impossible to ignore.
