New York City, the city that never sleeps, was one of the first put to rest when the coronavirus pandemic hit. With its world-famous museums, 24.7 nightlife, and restaurants mostly shut down, buyers and renters took themselves to more suburban areas where they could get out of the house while remaining safe. This left a ton of city real estate vacant and available at cheaper rates. However, now that the world is now being restored and people are craving that non-stop city life again, we couldn’t help but wonder what the market is becoming.
Compass Real Estate Agent, Bryce Kristall, spoke to CELEB about the New York City Market- how it’s changed, what is currently happening and advice for both buyers and sellers. Considered to be a “rising star in the industry” Bryce has experienced the rollercoaster ride that real estate market takes you on, let alone the ride that the pandemic has created.
A Shift In Values
Living through a quarantine a lot of us have learned how unlivable our homes truly are. Whether it be not having enough outdoor space, no secluded work area, and so on, we’ve been using our homes as a place to eat, sleep and wind down but not necessarily to go about our everyday routine. And let’s be real, why would we when we live in a world with endless activities and places to discover? Anyways, being tied down to the house for such a long period of time has shifted what people value when searching for a new place to live. Kristall shared “Quarantine changed our perspectives about our homes. Our homes have become everything to us and the meaning of home is important now more than ever. There has been an increased interest in homes with multiple bedrooms, washer dryer in unit, office space, and outdoor space. These homes have warranted a premium and buyers have been willing to pay the price.” She also emphasized on townhouses and their dominance in the luxury market of Brooklyn. “Townhouses are the culmination of all of the lavish amenities consumers are looking for – thousands of sq ft, separate living, eating, sleeping, working spaces, complete privacy, and outdoor space – balconies, rooftops, backyards, gardens.”
The need for these desires is typically synonymous with overspending/ spending money that buyers don’t necessarily have, but fortunately NYC makes it hard for that to happen due to strict lending requirements from banks. Kristall explains that sometimes sacrifice is necessary and it isn’t always possible to get everything on your list. She encourages her buyers to prioritize the top two to three aspects of a home that are most important and moving forward from there.
The Real Estate Market In A Pandemic World
Bryce gave us some insight on the market pre-pandemic saying, “the months leading up to the shutdown in NYC the market was starting to shift and stabilize out of a heavily sided buyer’s market. Prices were rising and December 2019 was the best December for signed contracts since 2016.”
And when the pandemic hit the market it became an oxymoron- “uncertain yet opportunistic” as Bryce described. She explained “the state of the market experienced the whole spectrum just like everything else in 2020. Fearless buyers jumped into the fire and got incredible value from sellers who thought the market was going to plummet. They got deals that will most likely not be seen again in this market cycle. A lot of sellers immediately took their homes off the market and the brave ones that remained on had to become very price conscious and incentivize buyers to purchase their home in such a challenging time. Discounts on resales were plentiful in the low teens and affording some buyers as much as $250,000 off the asking price.”
And for anyone who has doubted New York City’s liveliness, Kristell let CELEB know that it is very much alive now that the pandemic is calming down. “The last several months have been a continuous build up of demand, energy, and activity in the market. This is because of successful vaccine efforts, low interest rates, the promise of a new mayor…and there’s no place like New York City. It will always remain desirable and one of the most economically diverse meccas in the world,” Bryce said. She elaborated on the fact that spring is one of the busiest seasons for NYC real estate making right now one of the most competitive times for buyers, with bidding wars sparking up across the boroughs. She shared, “One of the most competitive markets I have seen is Park Slope, Brooklyn for 2+ bedrooms from $1M-$1.5M. Clients I worked with in this part of the market experienced multiple bid situations at almost every listing we saw – about 15 apartments and one went as high as ~$150k over the asking price!”
More and more people are migrating from the city to Brooklyn for the sole reason of being able to get more space within their budget while still having all of the perks that come with Manhattan such as parks, coffee shops, popular restaurants and bars, all within a walkable distance.
If NYC Is Your Next Move
Over the previous year and a half buyers have been incentivized to use financing when purchasing because rates were at one of the lowest that agents have ever seen, being approximately 2.5% and continuing to be under 3%. However, don’t forget about the cash buyers on the market for there are plenty. This intensifies the competition given that a cash purchase allows for a faster closing and lower risks for sellers. Bryce also revealed that there is a new layer of competition on the market and that’s Bitcoin. Yes. Some sellers are open to accepting Bitcoin as a form of purchase.
Bryce left us off with some advice for both buyers and sellers in the NYC area saying, “Be prepared before entering the market and work with an agent you like and trust to guide you through the complex process. Your agent is your biggest ally and will help your confidence in the market. Having that kind of expertise and support is crucial to a successful and smooth buying or selling experience.”