NYC Real Estate Market: Q4 2024 Report
The final quarter of 2024 brought a whirlwind of changes to New York City's real estate market. A highly contested election, fluctuating interest rates, and limited housing options created a complex and often contradictory sales environment.
A Tale of Two Markets
While the rental market, which boomed in the previous quarters, showed signs of slowing down, the sales market experienced significant volatility. The Olshan Luxury Market Report, tracking Manhattan properties priced at $4 million and above, revealed weekly sales fluctuating between 19 and 39 contracts. Interestingly, two of the year's strongest weeks fell within Q4, potentially influenced by the Republican election victory, which seemed to ease investor concerns about increased regulation and taxation for the wealthy.
Condo vs. Co-op: A Clear Winner
In the luxury market ($4 million and above), condos significantly outsold co-ops, at a ratio of at least 3:1. This disparity is attributed to several factors: condos offer modern amenities (gyms, pools, etc.), updated layouts, and immediate occupancy. Even previously less desirable locations are seeing record prices.
<img src="https://specials-images.forbesimg.com/imageserve/6772acdb9ce19a438134ed7c/Co-ops-vs--Condos/960x0.jpg?fit=scale" alt="Co-ops vs. Condos">Conversely, co-ops, often requiring renovations, face challenges due to supply chain issues and rising costs. This makes them less attractive to buyers despite potentially offering great value in terms of construction quality and price.
Shifting Preferences
Interestingly, younger generations (Gen X and Y) are showing less interest in traditional status symbols like Park and Fifth Avenues, with Tribeca emerging as the most expensive zip code. The trend of younger people moving from Manhattan to Brooklyn continues.
Rental Market Slowdown
The previously relentless rental market in Manhattan and Brooklyn also experienced a slight slowdown in Q4, leading to some price moderation.
Looking Ahead to 2025
The market is expected to see a potential modest increase in the latter part of 2025. Price stabilization and more realistic listing prices suggest a positive outlook. While sales remain inconsistent, they have shown improvement in the second half of the year.
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