Will the Real Estate Market in New York Survive?

When it comes to the price of real estate in one of the most magnetic cities in the world, the number of zeroes doesn't really matter. The most recent testament to this fact has been a three storey home, on a layout of 1950 sq.m at the top of the former Sony building.

Its eight bedroom, eight bathrooms, wine cellar, spa and office, it will be one of the most remarkable piece of real estate in New York after the renovation work on it is done. The construction company Chetrit Group has already announced, that this dazzling penthouse will be priced at $150 million. Another penthouse in a similar price range will soon be completed by another construction company called Zeckendorf Development. Their project, when completed, will be priced at "just" $130 million.

However, while the real estate market in New York patiently awaits its two new treasures, the record for most expensive penthouse is held by the apartment on the top floor of the One57 building, which sold for $100.5 million last year. It gained popularity when it became the first penthouse in the city to sell for over $100 million. Is this a worthwhile investment with the potential to bear returns or will these astronomically priced homes lose their value when the new examples of modern architecture and design burst on the scene?

"No one knows what the limit is, the truth is, right now, everyone is trying to find out. There a lot of people with means and the market needs to respond to what they are looking for", shares Nancy Pecks, marketing and design consultant to various construction companies in New York.

According to data from the business channel CNBC, the Big Apple is one of the "hottest" markets for luxury homes, the prices of which have increased by 18.8% in the period between December 2013 - December 2014. In comparison - the global increase in prices in the real estate market is only 2%. However, many people are convinced that this cannot continue for long as the prices are not based on reality. Proof of that is namely penthouse One57, which sold for $100.5 million but was originally announced at $115 million.