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New York is running out of luxury condos

The records keep piling up for Manhattan real estate.

The fourth quarter saw a string of records broken—from number of deals and average sale prices to dwindling inventory—as the rich from around the world scoop up luxury apartments as a store of wealth.

The average sales price in Manhattan rose 5.3 percent to $1,538,203 in the fourth quarter compared to a year ago. That marked the highest-ever price for a fourth quarter. The median sales price for condos is the highest-ever tracked, hitting $1.3 million.

And the inventory of apartments for sale has shrunk to its lowest level in recent memory, with a little over 4,000 apartments for sale.

144 Duane StreetSource: Douglas Elliman

The total number of sales surged 27 percent—a surprisingly strong increase given the rush in the fourth quarter of 2012 to do deals before the "fiscal cliff" tax changes.

"I think we're on a path for strong and sustainable growth this year as well," said Dottie Herman, president and CEO of Douglas Elliman.

(Read more: Manhattan apartmentsales hit a high)

While the overall market is on fire, New York is quickly becoming a tale of two markets—the soaring condo market and the lackluster co-op market.

The average sales price for condos surged 13 percent over the prior year to $2,115,228. The number of sales jumped 23 percent.

Yet co-ops—those storied preserves of Manhattan wealth and exclusivity—are being left behind. The average price for co-ops fell 1.6 percent in the quarter to $1,171,552, Elliman said.

(Read more: High rollers in a buying mood)

Brokers say the main reason for the difference is foreign buyers, who are virtually banned from the co-op market, since co-op boards often won't approve them and the overseas rich don't want to reveal their financials.

Plus, foreign buyers prefer the newly built, gleaming glass condo towers to the prewar co-op apartments of the past.


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