Regardless of the macro economic turmoil in the world, including our own difficulties here, segments of the NYC real estate market continue to be strong. There also seems to be an appetite for new construction. I have participated in deals at 148 E. 24th street, 37 Bridge Street (DUMBO) and both buildings have sold very well and without offering any concessions; in fact they both saw price increases along the way. (Also take a look at 130 West 12th Street, $2000+ a square foot and most are spoken for!) Both buildings, by the way, offered early buyers some very good deals. I have also seen relative strength in 2-3 bedrooms in most prime downtown neighborhoods, especially Tribeca and the Village. Many of my buyers in areas like Midtown (east & west), Gramercy and Murray Hill are telling me there are very few quality apartments available. Many of them were hoping for a nice pop of new listings after labor day and it never happened.
This has been a particularly strong December for me with two signed contracts and 3 accepted offers currently winding through the due diligence process.
Although the inventory is very thin, good deals remain for those looking on the edges of established neighborhoods and especially regarding apartments that need updating.
What's driving NYC real estate? There is no doubt that many of my clients are thrilled by the seriously low interest rates available. Next I would say the stubbornly high rents. Paying $80,000 to $120,000 dollars a year in rent gets tiring after a while. But most importantly (or at least a large part of the equation) is that people want to own their home. They want a space that they can mark as their own, they want the quality experience that can come with buying and not having to move out it in a year or two. And unless you are very actively managing your money, they like the idea of parking a part of their savings in NYC real estate rather than trying to invest the difference between owning and renting into an instrument that will dollar for dollar perform better than their apartment. In my own very un-scientific study of people who own versus rent; owners seem to be better off in the long term. This assumes you did not buy at the upper reaches of a bubble and plan on holding your home for at least 7 to 10 years. Now all you buy/rent quants, please don't attack me!
Of course buying is not always better and I would not recommend stretching yourself just for the sake of owning your home. Make sure you can comfortably afford ALL the monthly payments and you have at least a 6 month personal reserve fund in the bank. But all things being more or less equal, I would rather be paying off my loan than mailing out rent checks.
Peace and Joy to all this Holiday Season (and all of the years to come!)
P.S. The early 2009 sales are still holding up as the bottom for most NYC real estate as we go into 2012.