Expert NYC Real Estate Agents Talk the State of the Market, Election Effects, and More
It’s time to take the temperature of the NYC real estate market once again. When COVID-19 first unfolded and lockdowns began, we checked in with Diane Ramirez about how it was affecting the industry. Months later, Chris Halstead and Sharon Fahy of Brown Harris Stevens are giving their insight on where the market stands now and what they see for the future. Find out everything from how elections affect real estate to intriguing neighborhood trends from these seasoned agents.
What is the state of the New York City real estate market currently and how has it changed throughout this year?
Sharon: Currently, the market is moving in a positive direction, although it still has a long way to go. A lot of buyers are interested at various price points, and we are seeing them making appointments. People are proceeding with their lives, and since the election, we are seeing a very positive spirit in the City.
What’s the most surprising trend you are seeing and how are trends varying in different neighborhoods and boroughs?
Sharon: Activity Downtown, specifically in Tribeca, has continued at a nice clip. Other neighborhoods, such as the Upper West Side, have been taking a little bit longer to get back into the game with new inventory. There are a number of very good deals available on the Upper East Side at different price points. Activity has increased in the last three weeks, but before that, closing transactions on the Upper East Side had been slower.
Chris: Since March, we have seen the most consistency in the smaller apartment market, especially those priced under $1,000,000. Properties priced north of that took a lot longer to get moving. Since Labor Day, however, we have seen activity in larger apartments priced in the $4,000,000 range start to pick back up again. Those numbers have dramatically jumped in the last eight weeks. The bigger investments and spends which were relatively absent from the market for a good number of months have now also come back online.
How would you say buyers and sellers in the city are feeling right now?
Chris: Overwhelmingly, people have made the decision to proceed with their lives. At the beginning of the year, the market was very hot and then came to a halt due to the pandemic. Now, people are focused on what makes the most sense for them. For example, are they staying in the city? What specific amenities do they need in a home?
Since so much has changed in the past months, how are you currently conducting business? What restrictions are still in place for the real estate industry?
Sharon: We remain very cautious. For four months we were not allowed to conduct business in person. As the market reopened, buildings have set restrictions and established policies with safety and well-being in mind, among them are limits on showings and COVID disclosure forms. This has become the new norm, and it is running much more smoothly. We recognize we need to continue to do this for a while.
Chris: I have been happy to see how everyone has been so cooperative with these policies and jumped on board. From a closing perspective, it was at first very challenging – but as things moved online, and procedures were established for those that wanted to proceed in-person, it became more efficient. Various components of the transaction obviously take more time now, but it has become an efficient process in an inefficient world.
What is at the top of buyers’ wish lists at the moment?
Sharon: Lower prices, number one. Initially, buyers knew they could get away with making low offers with what we call “COVID discounts.” Now, the prices are tightening to the seller’s advantage and I think there has been a bit of reset.
Chris: The space within the apartment has become more important than the building’s amenities and offerings. Whether it is an additional space to accommodate a work from home set-up or an additional bedroom for kids to each have their own space. Certainly, the extra square footage is what most people are looking for right now. We don’t see many people looking to downsize at the moment.
How has pricing listings in Manhattan changed during the global pandemic?
Sharon: You have to take into consideration that you start with the property itself, look at the comps, and factor in where it was pre-COVID. Then you have to ask, will the seller acknowledge that the reset has really taken place?
You need to be careful with the comps you use against it because there are a lot of variables. Before COVID, many buyers didn’t want to do much work, and more so today. They feel as though any kind of renovation may be difficult or encumbered by COVID policies. The interest in everything being done has greatly increased.
Over the summer, an essay was published stating that New York City is ‘dead forever,’ how do you respond to that sentiment in terms of real estate and otherwise?
Sharon: We really suffered through a great deal of negative and exaggerated publicity. A very challenging time for the City but you can’t count us out. Once we adjusted to the new normal, New Yorkers were like “we are here and we’re not going anywhere.” New Yorkers are true blue.
In just a couple of months, we will have a new president, vice president, and administration. How have you seen elections affect the market before and how do you think the 2020 election will?
Sharon: Talking to a client, she shared “I’m so glad I was in New York when the election announcement was made. I felt so energized and positive about the City.” That feeling was echoed by so many. We might have a very difficult road ahead of us and it may be very challenging for President Elect Biden going forward, but it is peace and positive action that people are waiting for. I think everyone is ready to come together in the center.
Chris: Regardless of which election it is, there is always a bit of hesitancy going into it because there is the unknown on the backend. This year obviously it was supercharged so we really had people who took a pause. Now that we are in this direction, we have people who see a positive future who are opting into the market.
If you could look into your crystal ball for 2021, what do you predict for NYC real estate?
Chris: I think it will be interesting. Obviously, we have our challenges ahead of us. A lot of people put their home on pause so there is pent-up demand and people who are looking to exit. I think there is a market where we have both sides looking to transact, but the pricing structure is still to be determined. Last year we were building the foundation of a recovering market and we never had the chance to get there, so there are people who have been sitting on the sidelines for some time. New York is poised for a transitioning market where people are coming and going and trading within. We are looking at a potential year with some great volume.
Realistically, 2022 might be the year that it happens but hopefully, we can stabilize the real estate market sooner. We are looking at a market that will push forward, but I am hoping it comes sooner. It will come down to how well people will deal with this winter and the colder months and if we can work together as a community to be safe and practice health.
Sharon: Overall, I do think it’s going to be a challenging year in that, from a pricing standpoint, we may be resetting as we have done in cycle after cycle in years before. Ahead of us we have challenges with COVID, next quarter is going to be difficult. By midyear to 2021 we will be entering into a more positive market. People will be buying and selling no matter what. By mid-year, we will see an upswing, but I think the real change is 2022.