I would agree that manhattan prices are out of range for most people in the US. When I spoke about NYC was also including the boroughs (Queens, Brookly, Bronx ... ).
Beside, in NYC (Manhattan) one could acquire a nice 2 bedroom from under $US 500K. We are talking about the capital of the world, if you will.... running water, electricity 24/7, service (garbage, safety, police, etc.)
In our beloved DR (Santo Domingo) we are lacking these basic things... yet the lack of these necesities are not reflected in the prices.
Take Florida, including Miami, for instance. Due to the mortgate disaster prices went down consirably.
I also agree that most homes / apartments are owned; no pending mortgage.
I would have to agree that it might be possible that people would rather put their money in properties than in banks.
Would the increase in so many properties for sale would have something to do with the fact that expats invested in retirement homes in DR and for one reason or another they want out?