Well, the case remains the same in NYC real estate. It is all about ROI, but may I propose another angle to consider - people buy them to live in them, and as a long term investment. Historically, NYC real estate is better than putting money in the bank, or any investment out there.
"flipping" or "short sales" are hard to create in high end real estate because of financing restrictions. But let's examine a developer converting a warehouse. 15 years ago, the developer may have literally paid $1 (one dollar) for the land, or purchased it last year for several hundred a square foot. They assess this differently than a typical home purchase. Many times, they add several thousand sq feet to the project they originally bought. They can add floors, blow out walls, buy air rights. Let's just say that construction costs for a conversion are 3-$500 sq foot. Right now, studio lofts in Manhattan are going for $1,000 a square foot. That is what matters.
The other name of the game is just long term inflation. Sometimes just holding the property can net you the standard inflation + a few points, add the tax benefits, etc. It is a wise move. Plus the property is insured for loss/mortgage etc.
When you look at the big picture, including down payment numbers, tax shelters, etc, it may make more sense than you think. Plus, if your partner wants a view of central park, and they won't stop whining til they get it - it may be worth $1K a month to have them smile. lol.