Manhattan Luxury Market Heats Up in 2025: Sales Surge and Inventory Tightens
Manhattan has proven once again that its allure for high-end buyers remains as strong as ever. The first quarter of 2025 showed a significant uptick in luxury sales, with wealthier buyers scooping up prime real estate even as prices continue to climb and inventory shrinks.
According to new data from Douglas Elliman, luxury sales—defined as the top 10% of the market—jumped nearly 30% year over year. A total of 258 luxury properties changed hands in Q1, with a median sales price of $6.87 million. That’s an 18% increase from the same period last year, far outpacing the already strong broader market, where prices rose by 11%.
What’s driving this surge? Limited inventory at the top end of the market. While listings in the overall Manhattan market increased, the number of luxury homes for sale actually dropped 24.1% to 1,236—marking the third straight quarter of declines.
A closer look shows an interesting dynamic: listings under $3 million rose, but inventory in the $3M–$5M category dropped by 9%, and homes asking $5 million or more declined by 15%, according to Corcoran. Simply put, there are fewer high-end homes available, and buyers are moving fast when the right property hits the market.
The ultra-luxury segment also saw a major revival, with 17 homes selling for $20 million or more—the highest first-quarter tally since before the pandemic. However, it's worth noting that the number of contracts in this price range has fluctuated. In February, there were just three contracts above $20 million, compared to seven the year before.
This rebound isn’t limited to the luxury tier. Manhattan’s overall market recorded a 28% jump in sales year over year. Still, that’s just 1.1% above the 10-year average—suggesting the market is more accurately returning to a healthy baseline after last year’s historically low Q1, which marked the weakest sales volume since 2009.
One more trend to watch: buyer preferences for location have shifted. In 2024, Downtown Manhattan dominated with 50% of all deals. This year, that number has fallen to 36%. The West Side is picking up steam, doubling its share of deals from 12% to 24%. Meanwhile, activity in Upper Manhattan dipped to 7.2%, and the Financial District saw the largest drop in sales, down 19%, according to Corcoran.
What This Means for Buyers and Sellers
For luxury buyers, the message is clear: competition is back, and inventory is tightening. Acting quickly—and strategically—can make all the difference in securing a top-tier Manhattan property.
For sellers, especially those in the $5 million and up range, market conditions are extremely favorable. With fewer comparable listings and rising prices, now may be an opportune moment to list.
Whether you're buying or selling, staying informed and aligned with a knowledgeable real estate professional is key. Manhattan is moving again—and fast.