Real estate in New York City is some of the most coveted in the world, making for a pretty consistently hot sellers market that can seem impervious to national real estate trends. In recent years the city has experienced its astronomical rental prices soar to record heights, especially in Manhattan and Brooklyn. The high end super luxury properties, on the other had, saw a slower growth in price than previous years. However, competition for Manhattan homes remains ever on the rise, making it forever the sellers market on an island with little space to expand. Here are some ideas of what to expect to happen to the New York City housing market in the near future.
Luxury Market is Cooling Slightly
While saying any housing market in New York City is cooling is speaking only in the most relative of terms, prices for luxury properties in Manhattan dipped two percent last year. It’s a great time to buy for people like developer Louis Ceruzzi, who focuses on high rise residential and retail projects. Supply for high luxury properties has risen slightly above the demand, producing a marginally cooler market. These properties are amongst some of the most expensive and extravagant in the country, and if luxury properties are in your wheelhouse, now is the time to buy.
Manhattan Will Keep Getting More Expensive
Real estate forecast websites such as StreetEasy have predicted a ten percent rise in Upper Manhattan, which is a whopping four times the growth rate predicted for the rest of the city. Across the island, fierce competition for housing in almost every neighborhood will drive up the prices. Neighborhoods like Inwood, Hudson Heights and Central Harlem are undergoing a rapid price appreciation, which drives high prices up even further. Upper Manhattan, which saw a growth in median sale price by almost sixteen percent last year, will likely continue to gain momentum. This is one of the most competitive markets in the city.
No Respite for Brooklyn Renters
Brooklynites can now look forward to shelling out upwards of sixty-five percent of their income to rent alone, which is almost ten percent more than last year. This staggering number does not include utilities or any other cost of living. Brooklyn has had a reputation for the ridiculous in terms of rental prices and condition for several years now. An unreliable rent control system has enabled many landlord to raise the prices on their pads up to forty percent in just a few months’ time. Growth in rent continues to far outpace the city’s income growth, driving the price of Brooklyn’s rental properties ever higher.
New York City’s overall rent to income ratio predicted for 2016 is 65.4 percent. Brooklyn tops the list at 65.7 percent, as the cost of living there seems to be on an unstoppable rise. The Bronx now has the second highest ratio, though it still trails Brooklyn by a solid eight percent. Expect about 60 percent of your income to go towards rent in the Bronx. The Queens rental market is still relatively manageable at almost 52 percent, which is still far higher than the rest of the country.
Hottest Neighborhoods in the Upcoming Year
So where is everyone going, now that no one can afford Williamsburg and Greenpoint anymore? StreetEasy has compiled its annual list of hot places to live, and it seems that the rental market is pushing up into Queens. Jamaica is at the forefront of new rental trends. The prices in Jamaica are still comparatively low, and residents have easy access to the rest of New York City via the subway. Five out of the top ten hot new neighborhoods lie within the borders of Queens, making it a relatively affordable place that probably won’t stay that way for long.
Queens, and especially Jamaica, enjoys the aforementioned easy access to New York City and is also on a direct line to Long Island City, making it a perfect place for commuters to either place. With its exciting ethnic diversity and plethora of unique neighborhoods, Queens is becoming more and more attractive for people moving to the city, or for New Yorkers who have been priced out of the neighborhoods they used to call home. Queens is also a great place to find affordable prices for larger apartments that can accommodate an entire family.
New York City has always been at the top of the market, especially in Manhattan. While the outlying neighborhoods may have experienced a dramatic slump in the 1970s and 1980s due primarily to safety concerns, the city has more than recovered from any economic strife and is once again one of the most expensive places in the country to live. While seeking out a rental property in Brooklyn will inevitably prove to be a frustrating task, taking a gamble on the outlying neighborhoods will enable you to live close enough to the city to commute while enjoying a unique New York community. If you can afford it, now is the time to snatch up a coveted Manhattan luxury apartment or penthouse. Any way you slice it, the Big Apple is only going to get more expensive as time marches on.