If you’re thinking about selling your house, you’re likely hearing about the cooling housing market and wondering what that means for you. While it’s not the peak intensity we saw during the pandemic, we’re still in a sellers’ market. That means you haven’t missed your window.
According to a recent survey from the Wall Street Journal, the percentage of economists who believe we’ll see a recession in the next 12 months is growing. As more recession talk fills the air, one concern many people have is: should I delay my homeownership plans if there’s a recession?
Mortgage rates are much higher today than they were at the beginning of the year, and that’s had a clear impact on the housing market. As a result, the market is seeing a shift back toward the range of pre-pandemic levels for buyer demand and home sales…
The housing market is at a turning point, and if you’re thinking of buying or selling a home, that may leave you wondering: is it still a good time to buy a home? Should I make a move this year? To help answer those questions, let’s turn to the experts for projections on what the second half of the year holds for residential real estate…
According to a recent survey, more and more Americans are concerned about a possible recession. Those concerns were validated when the Federal Reserve met and confirmed they were strongly committed to bringing down inflation. And, in order to do so, they’d use their tools and influence to slow down the economy…
Homes for sale keep getting more expensive, but rising costs aren’t deterring enough buyers to slow things down — for now, at least.
New data from Zillow shows that despite soaring prices (up more than 20% over the past year) and surging mortgage rates (which have pushed the typical monthly mortgage payment 52% higher than last year), the U.S. housing market is as cutthroat as it’s ever been.
On the surface, you might expect high prices and rising rates to push some buyers out of the market and make home shopping easier for those remaining. But competition is actually heating up. The typical home for sale in April went into contract in just seven days, according to Zillow. (In April 2019, it took 24 days for an offer to be accepted on a typical home.) A recent report from Redfin suggested that the increasing pace of home sales is due to buyers “rushing to snag homes before they become even more expensive.”
And it’s not only that homes are selling faster than before. They’re also selling above their asking prices — a sign, Zillow says, that buyers are attempting to outbid the competition. Of the homes that sold in March, 48% went for more than the listing price. That's up from March 2019, when 37.5% of homes sold for over asking price.
Lawrence Yun, chief economist for the National Association of Realtors, called the current housing situation “quite unusual”.
Will the market ever cool off?
Though competition is stiff today, experts are seeing some signs that a cooldown is around the corner. More sellers are beginning to drop their asking prices, and inventory is rising, according to Zillow data. Existing home sales fell 2.4% between March and April, according to NAR. That’s the third straight month of declines.
Yun said he expects more declines in buyer activity in the months to come. Eventually, it’s likely that rising costs will deter enough buyers to bring prices back down to Earth.
“But,” Zillow’s Bachaud said, “we have not yet reached that point."
“Sales are coming down,” he said, “but listed homes are still selling swiftly, and home prices are much higher than a year ago.”
That's bad news for hopeful buyers, at least in the short term.
“With bidding wars continuing to drive up prices on limited inventory,” Zillow economist Nicole Bachaud said in a news release, “those in the market today likely won't feel much relief."
If you are like me at all then you have no problem eating dinner over lunch. Because dinner is basically just an enhanced version of lunch (food) with better conversation and a nicer ambiance. I love food. I love talking. And I love the ambiance. It’s hard to find a balance of all three though, but thankfully New York City has a few places that can serve up food, good conversation, and ambiance in one meal.
Una Pizza Napoletana
Location: Lower East Side
Cuisine: Pizza
Nonna Dora’s Pasta Bar
Location: Kips Bay
Cuisine: Italian
Kyu
Location: Noho
Cuisine: Japanese
Laser Wolf
Location: Williamsburg
Cuisine: Israeli
Nudibranch
East Village
Cuisine: Experimental
Matsunori
Lower East Side
Cuisine: Sushi
Skirt Steak
Location: Chelsea
Cuisine: Steak
Dinner Party
Location: Fort Green
Cuisine: American
L’Abeille
Location: Tribeca
Cuisine: French
Bonnie’s
Location: Williamsburg
Cuisine: Cantonese
Dept. Of Culture
Location: Bedford-Stuyvesant
Cuisine: Nigerian
Hawksmoor NYC
Location: Flatiron
Cuisine: Steak
Don’t you think May is an awesome time to visit New York City? The weather is fantastic, days are longer, and the city comes to life with all the small and big events that take place in spring. Here are just a few of the great things great that happen around May:
You're here to read the rest of this, aren't you? You're in luck! Here's where to find the best places to barhop in NYC and enjoy the view. Maybe you've heard of some of these places but are looking for some new spots. Either way, check out these great bars with top-shelf views.
Panorama Room
Overstory
Daintree
Westlight
The Crown
Dear Irving on Hudson
Ophelia
LLohi
Magic Hour Rooftop
The Ready Rooftop
Harriets Rooftop and Lounge
The Rockaway Hotel
Mr.Purple
Azul at Hotel Hugo
Jimmy
It’s getting more expensive by the moment to buy a home in America. Mortgage interest rates, historically low during most of the pandemic, are rising faster than they have in decades.
It’s been years since home prices have surged like this, and mortgage interest rates are rising even faster. And it may only get worse as more Americans try to buy homes before interest rates rise further.
Rising mortgage rates are supposed to cool down overheated housing markets. But it’s possible for now that both measures will keep charging ahead together, making it increasingly expensive to buy a home.
That would be especially true if you need a big loan with a 20% down payment or more to buy your first home. Or if you make less than $100,000 a year — because most first-time buyers do — and need an FHA loan to get into one of these pricier homes.
In February, according to the Mortgage Bankers Association, the median monthly payment on a new mortgage application in America jumped more than 8 percent in just one month. That spike points to an entirely new and unpredictable phase in what has been a jaw-dropping housing market.
Rates and home prices could well continue rising together for a number of reasons tied to high inflation today. Rents are soaring now, too. That means the alternative to buying isn’t particularly appealing, either. And in a time of high inflation, buying a home — and locking in today’s monthly payment for the next 30 years — is a good way to shield yourself from rising rents. In a context of 8 percent annual inflation, a 4.5 percent mortgage interest rate is actually a decent deal.
For would-be home buyers, “the alternative is both the rental option, as well as the option of where do you put your money?” said Arpit Gupta, a professor at N.Y.U.’s Stern School of Business. During past periods of high inflation, real estate has tended to be a better asset than other kinds of investments like stocks (and better than leaving money in a checking or savings account).
Mr. Gupta warns that rising rates can also make rental inflation even worse, because it pushes more people out of the buyer market and into the rental market, driving demand there. In a kind of feedback loop, those ever-rising rents will also continue to put pressure on people who can afford to buy instead, even at higher interest rates.
So far, as mortgage rates have risen half a point in the last four weeks, there’s little evidence the market is calming. In the past month, the share of for-sale homes accepting an offer within just one week reached a record, and list prices in the past week are still setting new highs.
You've found a home you love—now you just have to make it yours. If you don't have a hefty deposit or a sparkling credit score, a conventional mortgage might not be an option but there are alternative routes to homeownership.
Here we look at some of the financing methods available to first-time buyers and get expert advice on their pros and cons—plus the state of the property market—from real estate agents.
The real estate market has seen record price rises over the past two years, especially in cities such as Phoenix, Austin, Raleigh, Charlotte and Boise, according to Nicholas Athanail, a real estate broker at the Corcoran Group in New York City.
He told Newsweek: "NYC did see a COVID slump in 2020, but has bounced back with a vengeance. The average price of a Manhattan apartment jumped 19 percent over the previous year's and sales hit a record $7.3 billion in the first quarter of 2022.
Economists expect this growth to slow, he added, but are still forecasting a 5 percent increase in house prices by February 2023.
Athanail said about 70 percent of buyers finance the purchase of their homes, with the rest paying in cash. "The all-cash buyers are usually investors or home flippers—and they have been a major driver of the housing pricing growth."
Scott Durkin, CEO of Douglas Elliman Real Estate, said price rises were also being driven by a shortage of newly built and resale houses going on the market. "The prices are going up, mortgage rates are going up, but inventory is down," he told Newsweek.
Athanail said one industry study had found the U.S. was more than 3 million homes short of the demand from would-be homebuyers. Supply chain problems linked to the coronavirus pandemic have not helped.
The median price for a 2,500-square-foot family house in the U.S. is about $374,900, according to Athanail. There is, of course, huge variation within and between markets. In New York City, the average apartment measures 1,124 square feet, he said. New developments cost an average of $2,755,000; the median price for resales, which make up most of the city's market, is $1,182,500.How Much Do You Need to Earn to Buy a House?
The national qualifying income needed to buy a home is $66,978 with a 10 percent down payment, or $59,536 if you have a 20 percent deposit, according to the latest figures from the National Association of Realtors.
Again, this varies greatly from state to state. In New York City, Athanail said, lenders might expect a 30 percent deposit and the buyer's annual income would have to be at least $240,000.
The deposit expected is often higher in luxury markets, according to Durkin, while government-backed lending programs ask for less upfront. "It just depends on what market you're in and what loan you're looking to get," he said.
If you don't have that 20 percent down payment sitting in the bank, here are four alternative options.
If you've found the home you want, this option allows you to rent that property for a set period and then gives you the option to buy it.
After signing a rent-to-own agreement, you can move into your home right away. For the first few years, you will pay rent to your landlord and, in most cases, a portion of this rent will go towards the deposit for your house. After a predetermined amount of time, you can get a loan and finish the homebuying process.
Durkin said: "It can help you get a good credit score, and it can help a mortgage company give you a loan for the rest of the cost of the home."
You might have to pay a higher interest rate, however, he added.
Some Americans are eligible for government-backed mortgages. The money will come from a lender, but the loan is insured by the federal government so the terms are more favorable. These mortgages usually require little or no down payment, but applicants have to meet various criteria and pass a credit check.
A Federal Housing Administration loan is an attractive option for many first-time buyers. If you have a FICO credit score of 580, you can get a mortgage from an FHA-approved lender with a deposit of just 3.5 percent. You can also get a loan if your credit score is between 500 and 579, but you'll need to put down 10 percent of the purchase price.
The FHA, part of the Department of Housing and Urban Development, also supports loans on mobile homes and factory-built housing—plus a "reverse mortgage" for older homeowners who want to convert some of their property equity into cash.
Other HUD programs include Good Neighbor Next Door, which offers discounts to law enforcement officers, teachers, firefighters and emergency medical technicians to buy homes in "revitalization areas."
These loans are for active-duty service members and their families, as well as army veterans, and can be used to buy, build or improve homes. Once the service member or veteran has obtained a certificate of eligibility from the Department of Veterans Affairs, they can apply to a VA-approved lender. According to the department's website, the benefits include low interest rates, limited closing costs and no requirements for down payments or private mortgage insurance.
The Department of Agriculture offers various programs to help people buy and improve homes (and businesses) in rural areas. Its loan for single-family housing does not require a down payment—the government provides a 90 percent loan note guarantee to reduce the risk for lenders. Home loans are available to people who earn less than 115 percent of median household income.
This program is for American Indian and Alaska Native families, Alaska villages, tribes or tribally designated housing entities. The HUD website states: "With Section 184 financing borrowers can get into a home with a low down payment and flexible underwriting." The loans are available "for new construction, rehabilitation, purchase of an existing home, or refinance" and can be used on and off native lands.
Athanail warned, however, that it can be tricky to buy a home with no deposit in a hot sellers' market. When there are multiple bids on a property, a potential buyer who has no down payment might find themselves at a disadvantage if the other bidders are putting down 20 percent or are all-cash buyers.
Seller financing is when the home's seller essentially acts as a bank, lending the purchase money to the buyer, Athanail explained. In this scenario, buyer and seller agree to the financing terms as part of the purchase. It is particularly helpful if the buyer can't get a conventional mortgage and the process is usually quicker too.
The only downside for the buyer, according to Durkin, is that if your situation changes and you can no longer afford the repayments, the house goes back to the seller, no matter how much you've paid already. This should not affect your credit score, though, as you're not dealing with a financial institution.
Co-ownership or shared ownership is when two or more people agree to buy a property together for whatever purpose, usually with no down payment.
According to Durkin, it can work well for unmarried couples, siblings or close friends—as long as the relationship is strong.
"You can often buy a second or third or vacation home with shared ownership, or you can buy a two-family house and have shared ownership. I think it's wonderful. You just have to find a bank that will lend you the mortgage for that kind of ownership. If it's all cash, then it's much easier," he said.
Durkin warned, however, that if you get into an argument with your co-owners and the relationships ends, you may end up in court suing one another over the property.
Whichever financing option you choose, Athanail said, you need to "be ready for a lot of negotiations, paperwork, and discussion" when you buy your first home. It will be worth it, though: "The process may seem like a lot, but ultimately homeownership is the best thing you can do for your long-term financial success."
Ellie Kemper is officially breaking up with her NYC apartment! Actress from Unbreakable Kimmy Schmidt has listed her Upper West SIde apartment for $3.5M. This three-bedroom, three- bathroom residence was purchased in 2016 for $2.8M. Starting from the spacious entrance gallery, the floor plan flows to a great room with side-by-side living and dining areas. The prewar construction includes crown moldings, a fireplace, and a pale palette of wall colors. Take a look inside!
1. Central Park
2. Prospect Park
3. Brooklyn Botanic Garden
4. New York Botanical Garden
5. Roosevelt Island
6. Sakura Park
7. Washington Square Park
8. Greenwood Cemetery
9. Riverside Park
10. Union Square Park
Cherry Blossoms are blooming, rooftops are opening, and outdoor eating is back, which only means one thing. It's Spring! Along with the enjoyable outdoor activities, it's the season for home buying. With heightened demand and fewer listings available on the market, it's set to be a competitive one for prospective buyers. The good news is that inventory is coming back onto the market, which should ease some of the pressure homebuyers are feeling.
In February, 4,078 sellers listed their homes on the market across New York City. That was the highest number of new listings to come onto the market in any February on StreetEasy record – a sign that the market is still rebounding amid the pandemic recovery. The previous high was in February 2018, when 3,538 homes were added to the market.
After three months of for-sale inventory falling, StreetEasy data shows there was an increase in available homes between January and February. There were 16,622 NYC homes for sale in February, 549 more than there were in January. Still, inventory was 12.2% lower than it was in February last year, so there remains room for inventory to recover fully.
However, as the weather gets nicer, many sellers find spring an opportunistic time to showcase their properties. When there is an increase in listings, it brings an increase in buyers.
In New York City, the median time on the market for a home was 88 days in February- 28 days faster than last year. Buyers will likely notice homes moving quickly, if not quicker, heading into the peak shopping season.
Since the Pandemic began, it has been two years of unpredictability in the Real Estate market. However, data shows that the seasonality of the sales market is returning. Spring will be competitive for homebuyers, but an increase in inventory is promising. The recent rise in home prices should motivate sellers to list their homes, making it easier for potential buyers to find and win a home they love.
The financial markets have had a wild ride so far in 2022. Between dramatic swings in both stocks and cryptocurrency values, the specter of inflation casting a pall over the broader U.S. economy, and now Russia's invasion of Ukraine leading to acute geopolitical tension as well as some short-term plunges within the stock market. Investors have always leaned on residential property- Particularly in NYC- as a stable cornerstone in any well-balanced portfolio. This volatile moment may be creating a particular incentive for buyers to move more of their holdings into real property.
Financiers flocking to property in chaotic times are hardly a brand new phenomenon.
"Real estate has been acting as a substitute for bonds for a long time," said Marci Rossell, chief economist of Luxury Portfolio International. "The world is now a place that's not nearly as safe as we thought it was. So when people perceive the world is getting riskier, they save more, not less, and real estate continues to be the asset of choice to preserve principal and provide appreciation."
Many buyers are concerned about global financial risk or fundamental portfolio diversification. However, real estate is something you can live in; something to touch, sleep in and rent out if you’re an investor. In simpler terms, it’s brick and mortar. Still, this calculus becomes more complicated when buyers enter the market after close to two years of rabid demand and rapid price increases.
"Certainly, given the backdrop of concerns around sustained elevated inflation levels, the natural go-to is real estate or real assets," said Amanda Agati, a chief investment officer of PNC Asset Management Group. "[But] you have to be very careful and look at it on a market-by-market or city-by-city basis, because it's definitely not a buyer's market, it's more of a seller's market."
Part of the reason well-off buyers are eyeing property as a place to park some of their assets: After the last two years, those assets have grown to previously unseen heights. At the same time, the pandemic created a greater sense of importance around homes as a combination haven, school, gym, recreation center, and office, a phenomenon that hasn't gone away even as offices and businesses reopen.
"Especially after Covid, buyers are certainly still looking to buy homes for themselves and recognize it as more of a needed asset. They want larger spaces because people are working from home more, and they're putting a good amount of equity into that," said Peter Zaitzeff, an agent with Corcoran in New York City.
"Because of the wealth creation over the last two years, which has been exponential, they have the liquidity to invest in homes, which they see as an excellent investment, especially this year," Mr. Zaitzeff added. Buyers who have seen sudden spikes in the value of their stock holdings may also want to consider properties as a means of rebalancing their overall portfolios.
Now that we’ve been talking about inflation and real estate as an excellent hedge versus having it in the bank buyers in the last couple of years have become much more heavily invested in stocks and investment assets than real estate, but now there is much more urgency on the purchase.
Beyond the realm of traditional wealth accumulation, buyers suddenly flush with enormous cryptocurrency gains are making their presence known in property markets as well, and view real estate as an avenue for transferring their newfound wealth from a highly volatile asset into a highly stable one.
Agents have been seeing a massive push from crypto people to invest in real assets. Unsure of it is due to an overall cycle that has gone up in the last couple of years and now investors are seeing real money and thinking maybe this is not going to happen this way forever.
While investment-minded buyers are snapping up properties across the country (and Ms. Agati noted that recent growth trends in areas like Florida, Texas, and the broader Sun Belt region are expected to continue), New York City continues to have an evergreen appeal as both a desirable market and a reliable growth asset.
Coming out of the depths of the pandemic, the city also has a particular and time-sensitive advantage: Real estate prices haven't skyrocketed to the same degree seen in most other cities across the country, making one of the world's most expensive cities a comparative bargain for buyers with wealth to spread around.
Prices in New York have not gone up to the peak level that they once were in 2015 whereas, in other areas of the country, they’re unexpectedly high. Even though NYC had a historic year in 2021 we just came back to normalcy in terms of pricing. This dynamic can present a particularly appealing option for sellers looking to trade up after netting record-breaking bids in other parts of the country.
Many people are coming from other places because the real estate market is so strong that they potentially got a high sales number on their homes. Some have sold their houses for 25%abaove what they initially expected and are now saying they have an opportunity to move back to New York and compete.
With a citywide inventory crunch, the window of opportunity for luxury buyers hoping to bargain hunt in the city may be closing quickly.
Most high-end buyers also understand New York real estate to be a stable long-term investment play. Based on historical performance real estate markets like Manhattan offer stability and asset diversity is one way to hedge risks.
Mr. Zaitzeff added, "High-equity wealthy people have done this for a long time. You can leverage real estate in a way that you can't leverage equities, and at 2% interest, it's free money for these guys."
Over 150,000 Ukrainians call New York City home, and many live in the East Village's Little Ukraine. New York's Ukrainian Village, the blocks on Sixth and Seventh Street and Second Avenue in Manhattan are home to Ukrainian cultural institutions, restaurants, ex-pats, and more. Here's how the neighborhood is showing solidarity with Ukraine and how New Yorkers can help show support.
The famous Ukrainian diner's blue and yellow cookies represent a sweet show of solidarity from a classic New York treat. Eager diners have also been waiting outside in the cold to support the East Village institution.
Along with sharing the crafts and folk art of Ukraine in their longstanding collection, the Ukrainian Museum is also boosting news of protests, rallies, and demonstrations to take to the streets and support Ukraine. Follow @ukrainianmuseum on Instagram for news of upcoming gatherings and your daily dose of Ukrainian culture.
St. George Ukrainian Catholic Church
This active place of worship on East 7th Street has set up a shrine on its steps. Flowers, candles, and notes of inspiration or remembrance are there for all passersby to stop, reflect or add their own tributes.
Ukrainian East Village Restaurant
Known as the locals' alternative to an often busy Veselka, this East Village mainstay offers top-notch Ukrainian fare and hospitality. They're helping boost a fundraiser to send humanitarian aid to Ukraine via Facebook and are now serving Ukrainian borscht in honor of the heroes in Ukraine.
This Soviet-themed bar and literary hotspot near Little Ukraine is showing its own solidarity on the menu, by replacing Russian beer with Ukrainian beer.
The NYC art scene has never let us down before, and some pretty incredible exhibitions are to come for 2022. No doubt, these will be some of the best exhibits and must-see attractions in NYC in the next year that you'll want to check out! Here are a few we are most excited for:
One of New York’s biggest art events, the Whitney Biennial, generally takes place every two years but, after being postponed a year due to Covid, the massive cultural festival hasn’t taken place in the city since 2019. Now, America’s premier survey of contemporary art is coming back in a big way and will be held in the city’s Meatpacking District from April to August. The event also marks the 80th edition of the Biennial.
This year's Pantone Color of the Year is Very Peri, which is blue with red undertones. The soft, almost purple-y color will show up next year across ad campaigns and in fashion, Pantone predicts. In fact, it'll be the subject of a new digital art show at Chelsea's ARTECHOUSE in the new year. The show will evoke the emotion and feel of the color and offer a customized cocktail menu from the gallery's newly opened XR Bar. We're excited to be awash in this calming color and see a new trippy art show to start our 2022 off right.
After more than a two-year absence, the Met Gala returns in 2021 to celebrate the opening of the brand-new Costume Institute exhibition, “In America: A Lexicon of Fashion.” Once again, one of the best museums in NYC will be dedicating a new exhibition to delving into the larger social and aesthetic context of a singular fashion theme. This time around that theme is American fashion. However, there are a number of things about the exhibition that are quite different from past Costume Institute shows.
New York City's Housing market began its incredible comeback from the pandemic. While the pandemic started, there were significant dips in rent and home prices. But as we ring in the new year, there is both good and bad news for 2022. New Yorkers can expect to continue moving towards a full recovery- which is good news for the market. However, the housing market is predicted to continue with increases in rent and home prices which will also mean the housing market will be expensive. We've put together five significant vital aspects to consider as we embark on 2022.
In the summer and fall of 2021, NYC saw rents recover to a pre-pandemic level driven by high renter demand and concessions that did not end up renewing as a lease ended. A concession is measured by the share of homes on the market that offers one or more months of free rent. In 2021, Q1 had the highest percentage of concessions in the city's record, with a whole 42.8% of rentals. Even more units than in Q3 of 2020. however, many of these units returned to their gross rents within a year. The rate at which these pandemic concessions will turn over will peak again in Q1 of 2022 when nearly the same number of units come back onto the market-- this time without any discounts. With renters facing higher gross rents, many will no longer be able to afford their apartments, which will add to a flood of both demand and inventory in Q1 and beyond.
The rate at which people move to the city during the winter months typically declines. Therefore, there will be fewer renters on the market in Q1 2022 than compared to q3 2021, but with much more inventory. More inventory than demands could mean that rents may stagnate or fall in Q1. However, if this were to occur, it would likely be brief. Rents are sure to rise again as many more people make their way back to the city in the summer and new deals from spring 2021 expire.
The Q1 housing prediction of the sales market in 2022 will continue to be a tale of two cities. Luxury prices are now rising after a three-year slowdown. But on the other hand, home prices in the bottom price tier will remain flat.
We've seen that the luxury housing market is having a moment. The top two most expensive tiers for homes in Manhattan and the most costly tier in Brooklyn are rising fast, according to the Streeteasy Price Index.
We can expect to see an influx of more international investments in residential real estate and increased luxury demand after the pandemic pause and pent-up demand. Due to the wealthy accumulating more wealth from a surge in tech stocks and the fully vaccinated, international visitors can resume traveling to the U.S.
While homes in the bottom tier of prices are seeing a pause in growth, many New Yorkers were affected by economic repercussions during the pandemic, which was exacerbated by job losses. The bottom tier of home in Brooklyn and Queens fell more than any other tier in Q3 in 2021.
While being good news for prospective buyers, it is bad news for current homeowners. The lack of demand for the lowest-priced homes is further lowering prices, causing homeowners to lose equity in their investments and sellers to lose profits. Decreased demand for these more affordable homes will likely lead to flat or even falling home prices within that tier.
The following 2022 housing prediction has been brought into focus after the recent tragedies of Hurricane Ida. The devastating impacts on the city have added another layer to buyers' shifting priorities: flooding. Years ago, Sandy raised the issue of coastal flooding for all New Yorkers, but after Ida, New Yorkers located inland now have pluvial flooding to worry about. Therefore, climate change will be an essential consideration for many.
The flood maps for NYC are outdated and do not show which areas are most vulnerable to pluvial flooding. FEMA had proposed an updated map, which found that twice as many buildings than ever before were at risk.
Homeowner's wallets are already impacted as the higher the flood risk, the higher the insurance premiums in flood-prone areas rise. According to FEMA data, prices will go up for at least 62% of flood insurance policies in New York City. For 27,200 properties, the rise will be modest, not more than $120 a year. But about 10% or 5,400 properties will see their yearly costs leap by more than $120.
In the past 3-4 years, a sales market slowdown was created by "irrational" market behavior. Due to speculative purchases paired with expensive new construction, prices rose by over 10% year-over-year between 2013 and 2015. This led to a surplus of luxury inventory relative to demand, thus falling prices from 2018 to 2020. However, the pandemic sparked an overall rise in NYC home prices for the first time in three years.
At the beginning of the pandemic, low mortgage rates triggered a surge in demand, creating an outside force due to prices having fallen enough.
Home sales resumed and then reached record highs, allowing prices to recover. Thus, the market is much more rational now than a few years ago. It's functioning according to supply and demand market mechanisms, rather than artificially induced pricing from overly optimistic developers and sellers or bubble-like behavior.
Our 2022 NYC housing prediction is that this course correction will continue in the coming year. There likely won't be another recession that will lead to another massive drop in rates. Thus, there won't be a sudden, externally motivated spike in demand. Ultimately, it's up to the supply side — the new construction, the developers, the sellers — to price their listings correctly to avoid another sales market slowdown.
But what about the demand side? With sustained demand from home shoppers, buyers can expect fewer price cuts and more bidding wars in 2022. Currently, no neighborhood in the city has a sale-to-list price ratio above 100%. In other words, on average, homes closed at or below their asking price in all neighborhoods in the city. That may change in 2022.
Now that shopping, restaurants, and nightlife have reopened, living close to neighborhood amenities is essential again to New Yorkers who can afford to do so.
As seen on Streeteasy's 2022 Neighborhoods to watch, the hottest neighborhood in Manhattan is also among the most expensive. Soho tops the list, along with the West Village and Flatiron. However, the fun is not limited to Manhattan. Brooklyn hotspots also made the list, including Dumbo, Fort Greene, Bushwick, Gowanus, and Red Hook, which provide a similarly diverse range of restaurants and nightlife that make them attractive places to live.
According to Data from Streeteasy, subway ridership is up, more restaurants reservations are being made, rents are recovering, and more homes are selling than ever before. Meaning NYC's recovery is near.
