The streets of New York have been filled with new energy in recent weeks. As more and more New Yorkers get vaccinated, restrictions are loosened, businesses reopen, and there is a distinct feeling that things will soon be back to “normalcy.” For a city hit hard by the pandemic, both in terms of COVID-19 itself and economically, this recent shift is welcome.
The city’s real estate market has been one of the hardest hit sectors, with an unprecedented number of New Yorkers leaving the city in search of more space and less densely populated areas. However, in recent months, reports have shown that many New Yorkers are returning, with one post office data study predicting that by mid-2021 more people will move to the city than will leave. The real estate market followed suit, and in the first quarter of 2021. most apartments bought in Manhattan not only since the beginning of the pandemic, but also over the past six years.
To get a better understanding of the NYC real estate market, we spoke to four of the leading brokers in Brown Harris Stevens, the largest privately owned real estate company in the northeast. Brokers Joshua Arcus, Sophie Rave, Ari Kharkiv, as well as Roberto Cabrera consistently ranked among the top brokers in the country. With years of experience in the competitive New York City real estate arena, they have visited many types of markets. They share their expert opinion on the latest news in New York real estate, as well as their advice for buyers and sellers.
What’s new in the NYC market based on what you’ve seen with clients and in the field?
Joshua Arcus: Home sales continue to grow across all price points, sizes and areas. Rentals have skyrocketed, especially in the Upper East Side and now in Midtown, where people who have lived (or want to live) close to work are moving.
In addition, the large-scale return of employees to offices, coupled with New York’s announcement that schools will be 100% in-person next year, will see the light at the end of the tunnel for commercial property owners, even if that doesn’t happen until 2022. on fire, especially for restaurants and eateries that work with crowds of workers from Monday to Friday. They are capturing historically low prices with the expectation that by the time offices are 75-100% utilized this fall, they will be ready to go.
Sophie Ravet: Sellers build trust and buyers don’t want to pass up an opportunity to lock in a good price. We are seeing wars between bidding and over-supply closing. Both sides believe they have hit rock bottom.
Ari Kharkiv: The New York market is incredibly active and liquid, meeting or exceeding record transaction volumes, and demand outstripping supply. Prices in most submarkets are slightly below or slightly above pre-COVID levels, and we have experienced a more or less complete rebound from COVID rebates in terms of cost.
Roberto Cabrera: Inventories in the market are growing weekly, sellers are more realistic, resulting in huge deal volume. Buyers are increasingly realizing the value of low interest rates and fair prices. In my 23-year career, I have not seen such a volume. Competitive bidding situations are fairly common. We are on the verge of seeing prices rise again.
How will the opening of New York affect the industry and the real estate market?
JOshua Arkus: Midtown will fill up very quickly as the offices are 100% full. Companies that support office workers (administrators, grocery workers, restaurant workers, etc.) will also return. There will be a mad dash for the last deal available. The rental market is stabilizing and the sales market will continue to improve (most likely in the past, where it was in early 2020) as people take advantage of mortgage rates, those who sold in the suburbs seek to relocate to the city, and foreign buyers return. …
Sophie Rave: New York City Discovery is supported by vaccinated New Yorkers. The fear of living in a densely populated city is gradually dissipating, so those who left a year ago are returning. The news has come out and I can even see a lot of West Coast shoppers buying pieds-à-terre in New York. All this affects the sales and rental markets.
Ari Kharkiv: Our market has always relied more on local buyers and tenants than has been reported in the media. With that said, our markets receive significant capital inflows from domestic and international buyers, and our leasing market relies on full-time employees who want to live in the city near their offices. Opening up New York can only help the real estate market.
Roberto Cabrera: It gives confidence and a sense of “normalcy”. More and more people will want to join the party.
Where is the market heading? What can we expect in six months and later?
Joshua Arcus: Prices will rise as stocks run out. The only thing that could change is the number of new listings hitting the market, and there is no immediate indication that this is happening.
Sophie Rave: Buying activity will be high and prices will rise slowly for the first time in several years.
Ari Kharkiv: As offices reopen, city amenities reopen, tourists and passengers return, vaccination rates rise, federal aid dollars flow to the city and the MTA, and more, the outlook is incredibly positive.
Roberto CabreraA: I believe that this measurable level of activity will continue until the summer. After that, I see that the activity remains steady, but a little more subdued. Buyers recognize that the best deals are now. They may have missed the bottom, but not recovery. In a few years, those who have bought now will feel a sense of success, and those who have not bought will desire it.
What advice do you have for those who are going to buy in New York now / in the near future? What is your advice to the seller?
Joshua Arcus: If you want to make a purchase, be open-minded and get sellers to meet you where you want to be at a reasonable cost. If you need a very specific apartment, it will be difficult because there is not much inventory there. I would advise sellers to make sure that your apartment is in the best possible condition – both in terms of price and physical condition. Ideally, the buyer should leave thinking about what their offer will be, rather than how much the renovation will cost. In all cases, price is a key factor. Anything that does not match the price of competitors will not be sold / rented.
Sophie Rave: Don’t make impulse purchases, but be prepared to pull the trigger because there is competition. My advice to sellers: remember that we are still in a price sensitive market. You will sell if the price is right, but you will miss out on good buyers if the price is higher than the market price.
Ari Kharkiv: In terms of purchases, the rates are incredibly low, the values are more or less at pre-COVID levels (which have already declined somewhat in 2018 / early 2020), and our market has not experienced the price spikes seen in many markets in the US and the US. the world over the past year. From this point of view, New York is still a discount.
Opening up New York will only help drive up sales and rental prices. If you have a healthy 5+ horizon, now is the perfect time to buy. If you are looking to leave your property, be it an exchange, relocation or whatever, now might be a good time to sell. Properties with the right price are sold quickly and in many cases with several offers.
Roberto Cabrera: Over the past two decades, there have been several times when almost all important metrics have been in the buyer’s favor: stocks are adequate (which means you have a choice), prices are moderate (which means cost), sellers are more realistic (which means marketability) and interest rates. rates are at an all-time low (which means you have huge purchasing power). Buyers must get pre-approved for a mortgage to understand what they can afford and get down to business right away.
Sellers have to get in and out, which means they have to set the price correctly and do it. They need to know that the most active and the best deals come first. After that, the intensity dissipates – your asset decreases. Sellers should interact with an experienced broker who understands what it takes to create and organize the right market for their home. That and their ability to negotiate is what you pay for.