New York’s real estate industry was hit hard in 2020, as the pandemic disrupted every aspect of the market. After a rocky year, though, New York is once again on the rise, rebounding strongly from its pandemic downturn.
As one of the hottest markets in real estate right now, investors, agents, and brokers are flocking to the region to take advantage of deflated real estate prices before the area once again experiences a meteoric rise.
Let’s take a look at the New York market trends worth noting, as well as how you can capitalize on these before anyone else.
Falling House Prices
While some U.S. cities are currently facing a housing price boom, New York is experiencing some of the lowest sale prices in several years. In Midtown East, for example, vendors had to take an average of 14% below asking price in the first quarter of 2021. Manhattan as a whole is no different, with 97% of condos being sold at or below asking price, according to a report from appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.
Although falling house prices might be a bad sign for sellers, it’s music to the ears of keen investors looking to snap up prime real estate in New York. After the last economic downturn, the New York City real estate market rebounded stronger than other U.S. major markets, according to Real Capital Analytics. With median house prices in New York City on the steady rise again, there's little reason to doubt the region will return to its former glory — and fast.
Renting in Demand Again
When the pandemic hit, an increase in job losses saw droves of renters leave New York City in search of cheaper rent elsewhere. Manhattan was hit particularly hard, resulting in the highest vacancy rate in nearly 14 years.
As workplaces and schools have opened up again, however, renters are slowly returning to the city. The number of new lease signings continues to rise each month, with renters looking to take advantage of the best deals they can find within New York City.
Although last year's low rental prices have continued throughout 2021, they won't be permanent. The median asking rent in Manhattan, for example, rose to $3,000 in July 2021. This is the highest it’s been since July 2020 and is an increase from the pandemic low of $2,750 in January 2021.
Savvy investment buyers should tap into what renters in the region want, including outdoor space and enough room for a home office, while sale prices are yet to reach their peak and interest rates are still low.
When it comes to which areas to consider, real estate professionals are recommending neighborhoods like Midtown East, Tribeca, Soho, the West Village, and the Upper East Side.
A Boom in Smaller, Surrounding Areas
Although major cities such as Manhattan have faced a dramatic dip in sale prices and an increase in vacant properties, the region's boroughs are benefiting.
Take Brooklyn, for example, where home buyers inked deals for around 600 contracts in August 2021. This is a 142% increase from the same month two years ago, before the pandemic had even hit.
Surprisingly, Queens has also reported significant growth since the pandemic, both in pending sales and prices. Additionally, Westchester (which is located 30 miles north of New York City) reported an increase of 44% in the sales of family homes in the first quarter of 2021, compared with the same period last year.
The reason for this lies in the shifting lifestyle experienced after the onset of the pandemic. People now have less concern for commute time, coupled with an increasing desire for more space — both indoors and outdoors — at lower prices.
If investors are looking to benefit from this shift to the surrounding and more affordable boroughs and neighborhoods, however, they will need to act fast. The desire for more space at lower prices continues unabated, even as the pandemic ebbs.
How To Find the Best New York Market Data
To capitalize on these pandemic-influenced market changes, you need to assess the latest real estate data. This allows you to determine which avenue is a win-win for you, rather than taking a risk or simply relying on a hunch.
PropStream gives you access to the most comprehensive and accurate database available of over 153 million properties, helping you to not only understand market trends but also stay ahead of the game in an unpredictable, ever-changing market.
With an array of features such as heat maps, overlays, and reporting tools, PropStream lets you visually see what the current market looks like, helping you quickly identify the next hot spots within New York, or anywhere else across the country. Once you’ve identified your target areas, you can then find the right properties that meet your investment objectives using PropStream’s filters, drawing tools, and reports.
When you’re ready to explore the hottest real estate markets, like New York, PropStream has the tools to help you make the best-informed decisions. Start your free trial today.