New York is NEVER Over!

Dear Friends and Family,

I’ve been in the New York City real estate market for over 40 years and I can’t even count the number of times I’ve heard someone say “the NYC market is dead” or “New York is OH-VAH!” But guess what? It’s NEVER been true before and it’s not true now.

When I started in real estate in 1983, New York City was recovering from the deepest recession and job losses since the Great Depression. Interest rates were over 13% and the average closing price in New York City was $75,000. People claimed the city was done—too many problems and not enough money. It was a difficult environment to start out in, but it taught be two important lessons: be optimistic about my chosen profession and always take the long view. In the long run, NYC always wins. ;)

The 80s

In 1987, the steep stock market decline—Black Monday—sent shockwaves across the city. Recession hit and by 1989, the city had lost over 250,000 jobs. The cries of the critics were loud, saying New York was in decline, that the city was falling into neglect and it would never regain its crown, but the numbers prove otherwise: Even in a dire financial climate and with interest rates hovering around 10% (well above the historical average), home prices climbed 40% over this short period, to $104,500!

Party like it's 1999

The 1990s continued to be a period of rapid growth and development across the city. Suddenly, the big news was how NYC was coming back from decades of decline; from the subway to Times Square, everything started to look better. The real estate market bore this out: from 1990 to 2000, the average home price in New York City increased by 101.6% to $221,800. Interest rates had fallen to 6.24% and continued their downward trajectory. The city was resilient and the critics praised the turnaround of New York heading into the new millennium.

The Aughts

The next decade proved to be extremely challenging for the city, bookended by the tragedy of September 11th in 2001 and the Great Recession in 2008-2009. The media was dominated by predictions that the Financial District would never be inhabited again and that businesses would leave the city and never return. Instead, Lower Manhattan made a rapid recovery. Residential construction and conversion turned the 9-5 business district into a vibrant 24-hour neighborhood. By 2010, the average home price had increased by another 74.5%, to $386,900, helped along by an historic low interest rate of 4.33%.

'Teens to Today

The early 2010s was a period of slow and steady growth and NYC grew substantially in population and wealth over this period, with prices reaching a peak in 2016-2017.

The city was deeply wounded by Covid, at times feeling like a ghost town, and once again the critics said that it would never recover—too many people were abandoning the city and WFH meant they were not coming back. But they were wrong! By March 2021, the volume of sales was back up, and the average prices began to climb again. Despite the pandemic crisis, home prices increased 90% from 2010 to 2023 to an average of $736,300.

40 Years of Growth

Over my 40 years, that average Manhattan sales price of $75,000 has increased by 981%, and continues to rise. The current challenge for NYC real estate is higher interest rates, but this is no more than a temporary slowdown. We've seen sales progressing in fits and starts as rates change and buyers acclimate. While rates are significantly higher than a few years ago, they are barely higher than the historical average. Again, seeing it for what it is means taking the long view.

There are few investments as stable and primed for continued growth as New York City real estate. New York has never looked better and continues to be as resilient, cosmopolitan, and creative as it always has been.

Having seen this market, and this city, go through so much over 40 years, I’ve never lost faith in either of them. Whether you're looking to enter, move, or leave the market, I’m always here to help.

 

All the best,

 
 

Toni Haber

Licensed Associate Real Estate Broker
Founder, Toni Haber Team | Private Client Advisors
TONI@compass.com | 917.543.1999

Previous
Previous

New Chapters

Next
Next

Q3 2023