Good Time To Trade Down?

I am thinking of selling my large 2 bedroom and buying a small 1 bedroom in order to reduce my exposure to Manhattan residential. It was always part of my retirement plans to keep a small pied-a-terre as a NYC home and spend my retirement traveling the world, maybe buying a similar flat in London or Paris. I figure I could sell my 1,200 sf two-bedroom for around $1,500 psf and then buy a prime... [more]

I am thinking of selling my large 2 bedroom and buying a small 1 bedroom in order to reduce my exposure to Manhattan residential. It was always part of my retirement plans to keep a small pied-a-terre as a NYC home and spend my retirement traveling the world, maybe buying a similar flat in London or Paris. I figure I could sell my 1,200 sf two-bedroom for around $1,500 psf and then buy a prime located 650 sf one-bedroom or junior 4 for around the same psf and pocket the net profit to help fund my retirement and maybe buy a second home in Europe. I would no longer worry much about the Manhattan market as the new pied-a-terre would be for long-term hold. As part of my justification, I am speculating that demand for smaller units and pied-a-terres will increase due to demographic trends and affordability issues. But in truth, I do not know if this prediction is accurate. Some on this forum are bullish on the $1,500 psf market at least in the near term. Anyone have a sense of the long-term (15-20 years) outlook for small apartments, and pied-a-terres in very good locations in the $1,500 psf range? What would you do in my shoes? [less]