Higher Wall Street bonuses, a strong regional economy, and pent-up demand from people who previously feared a real estate crash is driving up sales and prices in New York City.

During January, both prices and the number of signed contracts rose in double-digit percentages compared with the year earlier period, real estate practitioners say. Pamela Liebman, the president of the Corcoran Group, reported the company’s contracts for January totaled $1.3 billion, an increase of 53 percent from January 2006.

There is “cautious exuberance,” says Steven L. James, director of Manhattan sales for Prudential Douglas Elliman.

Meanwhile, on the West Coast, luxury home values in Los Angeles, San Diego, and San Francisco fell slightly during the fourth quarter of 2006, according to the First Republic Prestige Home Index.

The index, which has tracked luxury homes since 1985, found Los Angeles values slipped 0.8 percent from the third quarter of 2006 to the fourth quarter, but were up 2.9 percent from a year ago. The average luxury home in Los Angeles is now $2.35 million.

San Diego values declined 1.3 percent from the third quarter of 2006 to the fourth quarter, but gained 3.3 percent from the previous year. The average luxury home in San Diego is now $2.15 million.

San Francisco Bay Area values fell 1.5 percent from the third quarter of 2006 to the fourth quarter and gained 1.5 percent from a year earlier. The average luxury home in San Francisco is now $2.92 million.

Source: The New York Times, Tracie Rozhon, (02/19/07) and REALTOR® Magazine Online