New York Real Estate Market Report For 2020
Let’s take a look at the statewide data of the New York real estate market and the impact of the Covid-19 pandemic. The statewide market data includes single-family properties, townhomes, and condominiums. In May 2020, low inventory and increasing buyer activity kept the prices stable in the New York housing market. The median sold price remained flat at $270,000 in May as compared to last year.
The month’s supply of inventory dropped by 11.5 percent in May, from 6.1 months to 5.4. On the other hand, sellers in New York are still holding back on listing new properties on the market. New listings are still on the decline as compared to last year. According to NYSAR, as COVID-19 restrictions continue to soften, the New York real estate activity is expected to continue to improve in the coming weeks.
Homes are selling below their asking prices as the median price of homes that have been sold out is $432,800. It shows sellers were willing to negotiate on prices as they were finding it more and more difficult to sell homes at asking prices. While the Empire State continued to re-open in June with New York Forward, real estate activity slowly began to strengthen, according to the housing report released by the New York State Association of REALTORS®.
Three Ways To Invest In New York City Real Estate
New York City real estate is renowned for investment opportunities. As one of the most famous cities in America and the world, New York City property presents unique investment opportunities. There is one problem, however. Real estate in New York is expensive. In fact, a report from Savills Research shows New York City as the most expensive city in the world to rent, and one of the most expensive residential real estate markets.
One might look at this and believe the high rates leave little opportunity for investment. That is not the case. There are ways to invest in New York City real estate even if you dont live there. Here are a few of the best ways to do so.
Advantages Of Working With A Real Estate Agent In New York
Before buying a home in New York, it’s prudent to speak with a real estate agent. A real estate agent is someone experienced in working with buyers who can help you find your home and handle many of the complex procedures involved with the purchase. Be sure the agent you choose has experience representing buyers, good references, and qualifications to meet your needs. For example, some agents have particular areas in which they specialize or work primarily on transactions of a certain monetary size.
Some of the benefits of using a real estate agent include the agent’s:
- knowledge of the community, median home prices, and market conditions
- ability to match homes and neighborhoods to your needs and budget
- help suggesting terms of the offer
- managing deadlines, and
- negotiating with the seller on price and other key terms.
Your real estate agent should also help you locate other professionals to assist you in the home-buying process, including mortgage brokers and home inspectors. Agents will often have longstanding relationships with these entities, saving you time and work.
The good news is that working with a real estate agent will not ordinarily cost you anything. It is common in the industry for the home seller to pay the entire real estate commission .
New York State law requires real estate agents to advise potential buyers with whom they work of the nature of their relationship and your respective rights and obligations. .
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Climate’s Impact On New York Housing
Likelihood of Flooding in New York Homes
- Floods in New York caused $206 on average in property damage this year.
- 3% of homes in New York are required to have flood insurance. Flood insurance
Likelihood of Storm, Drought, Heat, and Fire
- A day that reaches above 91ÂºF is considered hot for New York. Normally, New York experiences about 8 hot days per year.
- New Yorkâs forecast in 2050 is about 34 hot days per year.
- The percentage of available water supply used by humans determines water stress. An area is at especially high risk when water stress is above 40%. New Yorkâs water stress now is about 18%.
- New Yorkâs projected water stress in 2050 is about 19%.
- Normally, about 0% of land near New York burns in a year, or about 126 sq. miles within a 100-mile radius.
- New Yorkâs forecast in 2050 is up to about 279 sq. miles burned in a year .
- Fire risk in New York ranges from Very Low to Low
- Normally, New York experiences about 8 significant two-day storms per year, with about 2″ of precipitation per storm.
- New Yorkâs forecast in 2050 is about 24 storms, with about 3″ of precipitation per storm.
What Is A Real Estate Website
Real estate websites bring buyers and sellers on one platform. They provide convenience in finding the next home for the buyer while giving exposure to the seller.
Buyers can view thousands of property images, videos, and features before they agree on scheduling a live tour. Sellers who post their homes on these sites benefit for the same reason thousands of prospective buyers can view their homes online without a walk-through.
Real estate websites also serve as a marketing channel for the professional stakeholders that contribute to the transaction. Realtors, mortgage professionals, banks, and inspectors can advertise on these websites to generate leads.
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Best Places To Invest In Real Estate In New York For 2019
But investing in New York real estate is always a good idea.
I hear this time and time again from new investors, and then I try to talk them out of a particularly risky investment opportunity. As an investor, this myth is dangerous. Yes, your New York investment property may increase in value indefinitely, unless something catastrophic happens, but theres a big difference between buying a single retirement property and running a real estate investment business.
When it comes to investing as a business, every new investment always comes with an opportunity cost. You could have invested that money elsewhere into a different property that may have brought better returns or offered scalability for the future. That means, for investors at least, there is such a thing as a bad New York property investment. Knowing the best places to invest in real estate in New York and what to look for can be the difference between success and failure in 2019.
An Overview Of Nyc Rental Market
In the latest Douglas Elliman report, the high leasing volume continued to push prices up in September 2021. The increasing new lease contracts in New York City are helping to slow annual rental price declines. The rental prices are nearing their pre-pandemic level.
Manhattan’s discounts are attracting tons of renters. The surge of new lease signings in Manhattan slowed as landlord discounts dwindled. Net effective median rent increased year-on-year but fell short of 2019. For the 12th month in a row, new lease signings increased year over year, but at a slower pace. This is the lowest rate in nearly four years for new leases with landlord concessions.
Doorman median rent has risen considerably recently, whereas non-doorman median rent has fallen. While existing median rent stayed steady, new development median rent increased. New leases over $10,000 per month saw their highest market share ever. Luxury listing inventory fell by half in the year to its lowest level since 2015.
New lease signings in Brooklyn have continued to rise sharply. The increase in new lease signings year over year in Brooklyn was the highest for September since 2008. For two of the last three months, net effective median rent increased month over month. The market share of new lease signings for studios and one-bedroom apartments increased year over year, owing to the available discounts.
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Things To Do In West Chelsea
Walk or jog along The High Line, a 1.45-mile elevated park that used to be the home of the New York Central Railroad. Explore contemporary art galleries like David Zwirner, Jack Shainman Gallery, and Denise Bibro Fine Art. Check out the interactive theater performances, live concerts, and rooftop bar at The McKittrick Hotel. Dance the night away at beloved gay bars like The Eagle NYC or attend drag shows at REBAR. Or enjoy a seasonal brunch at Cookshop, where you can get everything from a Cookshop Burger to Pizza Bianca.
Hoping to learn more about the best places to live in NYC? Explore these guides to the 25 safest, most affordable neighborhoods and best boroughs in New York City!
Whether you plan to buy property in Brooklyn, The Bronx, Manhattan, or Queens, Extra Space Storage has convenient storage facilities throughout NYC that can help with your transition. Find a storage unit near you!
Neighborhood statistics from AreaVibes.
Whose Services Will A Foreign Buyer Need
Unlike other countries where you can use the services of one real estate agent, in America, a team of specialists helps you buy an apartment. Because theres such a high demand for housing, you need to consult with different brokers to find and buy a home. The more qualified specialists you work with, the better the result will be.
The first person to talk to is a broker wholl advise you about how to buy a home. They must be licensed, navigate the areas of the city, and be in touch 24/7. Theyll also coordinate the teams activities. The team has mortgage brokers, a lawyer, a property law specialist, a financial consultant, a housing inspector, an accountant, surveyors, appraisers, an architect, a designer, movers, and others.
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Midwood Bushwick And Bedford
Coronavirus has many New Yorkers rethinking their desire to live in the middle of everything, and further-flung neighborhoods that offer lower population density, less-crowded apartment buildings, and more square footage now have more appeal than ever. Long subway commutes are not a concern for New Yorkers who will be working from home in increasing numbers.
Looking deeper into Brooklyn, where housing prices havent shot up in the past decade with the same speed as they did in the neighborhoods nearer to Manhattan, may be a smart move.
There was a flight to value but I think the pendulum is in the middle now. Its not swinging in Brooklyns favor anymore unless you go deeper into Brooklyn like Midwood, Elika says. Midwood has diverse housing options: low-rise apartment buildings, townhouses, and multi-family units and is featured on our list of best Brooklyn neighborhoods for first-time buyers.
I’m still quite bullish on the single and small multi-family properties in Queens and Brooklyn, Levin says. Lower taxes and convenient proximity to the city is still a strong draw and offers advantageous investment potential. This has not changed. What has changed is that we are having numerous conversations with clients who are looking to trade larger buildings for smaller boutique buildings and those in the heart of the city are now thinking of neighborhoods on the outskirts.
New York City’s Expanding Luxury Development
New Yorks rent control laws dont apply to luxury units, and developers have chosen to build these instead of the affordable housing the city needs. However, this development isnt limited to the densest parts of New York City. For example, Staten Islands North Shore is seeing new luxury condo construction. Interest in the area is driven by both the improved transit via the new ferry service and luxury buyers seeking relative bargains. This is aside from the oversupply of luxury penthouse units in the NYC housing market.
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Real Estate Investment In Bay Ridge Brooklyn New York
Brooklyn is one of the more affordable areas in the New York City metro area. The average tipping point for Brooklyn is 4.17 years. And Bay Ridge is cheaper than average, though that will soon change. Wed recommend buying real estate in Bay Ridge before the inventory is snapped up by first time home buyers being advised to buy here.
Why invest in Bay Ridge? Bay Ridge has a suburban feel. Thats because the long commute to Manhattan prevented dense development. It is going to see a boom in valuation because it now has a direct ferry service to Wall Street. This is in sharp contrast to the temporary deals you might find in brownstone neighborhoods like Brooklyn Heights, Clinton Hill, and Fort Greene.
Property has become very cheap in these areas because of the uncertainty about the Brooklyn-Queens Expressway as well as the fact many dont want to live there during construction. We dont recommend buying apartments for as little as 100,000 dollars that may be hard to rent out and may not sell for much in the future. Brooklyn’s Bay Ridge is much more stable.
Latest Housing Trends in Bay Ridge
As we write this, there are 182 active rental listings on Realtor.com with a median rent of $1,800. Houses tend to sell for less and sit on the market for a longer period of time before receiving an offer. On average, homes in Bay Ridge sell after 169 days on the market. The trend for median days on market in Bay Ridge has gone up since last month, and slightly up since last year.
Preparing For The Closing
- After signing the contract, one still has time in order to obtain the necessary funds and to do appraisals, surveys, a title search, and check for violations and lieus on the property, in addition to reviewing documentation.
- During this time, assuming a buyer has applied to get a mortgage, the bank will check his assets and documentation, along with a buildings financial information.
- Once the bank is satisfied with everything, the complete loan will be wired to the buyers attorneys escrow account, along with the closing costs and down payment.
- It is wise for a buyer to visit the property the day before the closing, just to confirm that the property looks as the buyer expects it to, before closing.
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Where Can You Buy A House In New York Detached Single
You may think of New York as a place where you can only buy apartments or condos. This is not the case though, although detached single-family houses are quite rare in e.g. Manhattan. You will not have much difficulty finding a house in e.g. the southern parts of Brooklyn as well as Queens . Of course the legendary Hamptons are also prime real estate.
Should I Rent Instead Of Buying
Most people who move to New York prefer to rent due to the exorbitant cost of purchasing a home . But if you plan to live here long term, it may prove more beneficial to buy rather than rent, especially considering the high cost of renting in NYC.
There are also several neighborhoods in the citythe East Village, West Harlem, and Kew Gardens are just some exampleswhere it may make more sense to buy, since youll break even on the cost of your investment in fewer years. But theres no one-size-fits-all answer ultimately, your financial situation and personal preference will dictate whether you rent or buy.
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Sign The Sales Contract
If the seller accepts the terms of the transaction, then a contract for the purchase of the object is concluded. This document must contain all the terms of the transaction, such as:
- The period of the assessment
- The purchase price
- The deposit amount
- And the terms of the transaction.
The buyer must pay a deposit . This deposit is a guarantee of the buyers serious intentions, as well as a reservation for the intended object.
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Best Places To Invest In The New York Real Estate Market 2019
Year after year, New York has consistently been one of the best states to invest in real estate. The New York housing market forecast is extremely bright for many of its cities. New York City-Brooklyn, for example, is projected by a PwC report to be among the best cities for investing in New York real estate and US real estate overall.
However, thereâs more to the New York real estate market than NYC. The Empire State is surprisingly an excellent spot for lucrative and even affordable real estate. Today, weâll talk to you about the 7 best cities for investing in New York real estate.
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When In Doubt Start Small
Some renters purchase a duplex or a multi-unit property and live in one of the units.
This can be a good way to get started in the real estate investment circuit, and its certainly better than throwing your money in a black hole, aka, paying rent.
There are thousands of beautiful multi-family houses that can make a convenient first go at investing.
Hopefully you select quiet, respectful tenants to fill the other units!
Apartments with one or two bedrooms are generally easier to rent, as tenants looking for smaller units make up a large percentage of the prospective population.
Bigger units command a higher price but their vacancy period can be longer as there are fewer tenants shopping for bigger units.
That said, the tenant mix for larger units can be less transient, as it encompasses the population with families who want to settle for a longer period.
Studios also tend to be a good bet for a first investment as theyre generally high demand, and its easy to fill one with a professional.
Studios do come with more competition for these same reasons. You might want to consider buying a couple studios to balance your portfolio.
Remember: rent in NYC is determined by number of bedrooms, not the size of bedrooms!
Also, important to remember are building policies for subletting or renting out apartments.