13 foot ceilings and 4,200 Sq Ft.
Industrial feel
Completely renovated
Central air
Gorgeous surfaces throughout:
brick, walnut, marble, steel, glass
Beamed ceilings
Vented exhaust in kitchen
$6,950,000
Call 212.321.7111 for an Insider showing!
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LISTING COURTESY OF BROWN HARRIS STEVENS
Buyers and sellers of apartments and townhouses here can forget that New York City is a city of renters. 70 percent of our housing stock is rental apartments. As you can see from the chart below, this contrasts heavily with the rest of the country, which has the opposite ratio – about 30 percent of the housing stock is rental.
Sources: American Community Survey, NYU Furman Center
So when rental prices surge here in NYC, as they have been…
The effect spills over to the sales market in a far more profound way than it does elsewhere. In this case the high rental prices will continue to push people to buy apartments, at least in the sub $2M price range. Above that price, the transitive effect will be lesser (a person paying $10,000 a month in rent cannot for the same monthlies purchase an apartment over $2M taking into account interest rates at over 5% and the common charges and real estate taxes or maintenance).
This means that the lower end of the market will continue to be stronger than the high end. We have in fact seen the high end start to stumble a little. As this week’s Olshan Report says:
“Twelve contracts were signed last week in Manhattan at $4 million and above, 13 fewer than the previous week. It was the worst week in the luxury market since the week of December 28, 2020, when 10 contracts were signed. This anemic performance coincided with the S&P 500 Index dropping 5.8%, its worst week since March 2020. The S&P has fallen 11 of the last 12 weeks.”
Source: LUXURY MARKET REPORT 2022 Report on Contracts Signed Manhattan Residential Properties $4 Million and Above June 13-19, 2022
Further we are going to see supply constraints ongoing as people remain in their current homes because financing is so much more expensive. Wouldn’t you rather keep a 3 percent mortgage on your current home then pay high prices and lock in a 5.5 percent mortgage? That calculus is going to continue into the next year as homeowners focus on the real frictional cost of switching to another apartment.
All in all, we believe that the market will bifurcate with the under $2M segment continuing to be relatively strong, while the luxury market will come under pressure as the financial markets continue to show volatility to the downside.
