5 Predictions for 2025 NYC Real Estate Market

Happy New Year everyone!  

The New York City real estate market closed out 2024 on a high note, particularly in the luxury and new construction sectors, where demand is rising and supply is shrinking.  However, this dynamic hasn’t yet been strong enough to significantly drive up prices.

In this first letter of the year, I  want to share some insights and predictions for the year ahead, drawing from Zillow data and the experiences of brokers who are deeply engaged in the market daily.

Suburban buyers returning to NYC 

Our team is working with two buyers who initially sought homes in New Jersey but faced countless bidding wars. Frustrated, they’ve shifted their focus back to the city. Additionally, corporate return-to-office policies are playing a role. For instance, JPMorgan will require a five-day in-office schedule starting next month. This suburban competition, paired with increased office mandates, is driving many buyers back to NYC.

Brooklyn and Queens rising as rental hot spots

Manhattan’s rental vacancy rate hit a 60-year low of just 1.4% in 2023, pushing rents to unprecedented levels. In response, renters are seeking more affordable options in modern buildings across Brooklyn and Queens, making these boroughs increasingly popular.

The Luxury Market Gains Momentum

The luxury segment, with properties priced at $4 million and above, experienced the sharpest price declines in recent years. But with bonuses rebounding and prices stabilizing, luxury buyers are returning to the market.  The recent runup in stock prices also adds to market confidence.

Foreign Investment Flows Back to NYC

NYC has always been a destination for foreign investors, thanks  to its vibrant culture and economic opportunities.  Fellow brokers are noticing more and more foreign investors coming back to put money to work in NYC.

Smart Homes and Green Features on the Rise

Technological advancements, such as remote and voice-controlled lighting, temperature, and shades, have evolved from niche ideas to mainstream expectations. Buyers and renters continue to pay up for outdoor space, gyms and other wellness-focused features.  Environmental considerations are taking a bigger share in the decision-making process for buyers.

Looking Ahead

I’m very much looking forward to the new year!  As I told my team, this is my 11th year in the business.  Every year the market and the consumers change.  Every year I learn something new and make the business better for our clients and our team.  I can’t wait to go on another year of adventure with all of you!

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New Development Spotlight

Colette Greenwich - A boutique, full-service condo building designed by Paris Forino, is coming to Greenwich Village.  Between Union Square Park and Washington Square Park, this new project is within walking distance to NYU, Parsons and other favorite destinations for New Yorkers.