updated 1/3/2007 7:59:31 AM ET 2007-01-03T12:59:31

The average price of a Manhattan apartment rose to more than $1.14 million in the fourth quarter of 2006, up 5 percent compared with the same period a year earlier, according to two new real estate reports.

The median price for the apartments was $760,000, a new record, beating the figure from 2005 by 9 percent, according to the reports released Wednesday.

The median value is the price at which half the sales are higher and half are lower. It is an important indicator of a market's stability, said Greg Heym, who authored the reports for two Manhattan real estate firms, Brown Harris Stevens and Halstead Property. Heym is the chief economist for Terra Holdings, which owns both firms.

Heym, who also serves on the city's Economic Advisory Panel, said Manhattan is experiencing a more balanced market, meaning that price increases have become more sustainable — unlike in 2004, when double-digit gains were common.

The reports also reflect the New York market's resilience in the face of a nationwide housing slump.

One of the biggest price surges in Manhattan took place on the Upper West Side, where four-bedroom and larger apartments cost an average of $5.7 million, or a 48 percent increase over the fourth quarter of 2005.

The average price of an apartment with three or more bedrooms on the Upper East Side was about $3.8 million, up 22 percent.

The average price per square foot in Manhattan rose to a new high of $1,050 in the fourth quarter, up 7 percent from $979 a year earlier.

"The market for luxury apartments in Manhattan remains very strong, and we're continuing to see steady growth in this sector," said Hall F. Willkie, president of Brown Harris Stevens.

The average sale price of new condominiums remained relatively flat at $1.3 million, about $13,000 less than in the fourth quarter of 2005. Cooperative apartments in Manhattan saw their average sale price rise 3 percent to reach $953,120.

The Halstead report showed apartments sold during the fourth quarter of 2006 spent an average of 97 days on the market, 15 percent longer than during the same period a year earlier. Sellers received 97.9 percent of their asking price, down from 99.1 percent.

Heym said he doesn't see prices softening going into 2007 thanks to solid job growth in the city, a healthy economy and low interest rates.

"It looks like demand will remain pretty strong," he said.

Heym added that record Wall Street bonuses, expected to top nearly $24 billion, also should buoy the housing market across the board.

Both reports were based on 2,364 reported sales.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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