Real Estate
WHEN IT COMES TO HIGH-END HOUSING, IT’S HARD TO BEAT THE BIG APPLE. Tamsin Bradshaw EXPLORES THE REAL ESTATE OPPORTUNITIES IN MANHATTAN AND BEYOND
When it comes to high-end housing, it’s hard to beat the Big Apple
Frank sinatra, billy joel, Lou Reed, Snow Patrol, Jay-z and Alicia Keys are just some of the renowned musicians who have penned glowing odes to New York over the years. Now, more than ever, real estate buyers want to be a part of the city’s illustrious history. “New York is the epicentre of the US luxury market—and no other city in the US is seeing such strong demand in highend housing,” says Nikki Field, senior global real estate adviser at Sotheby’s International Realty. She adds, “Consumer confidence in both the US economy and the dollar has contributed to new record-setting prices in the luxury segment.”
Kirk Henckels, vice-chairman of Savills’ New York affiliate Stribling & Associates, agrees. “The world economic situation and currency positions made New York City a piggy bank for global buyers. Our market is relatively stable year in and year out.”
Adds Laura Desmoine, senior vicepresident of brokerage marketing at Engel & Völkers NYC, “New York’s real estate market is one of the safest to invest in, as the buying and selling process is transparent and the market is in a state of almost perpetual growth.” The global property agency recently opened its first office in New York, a clear sign of its faith in the market. “Engel & Völkers has always had its sights set on New York and was waiting until the timing was right, in terms of the global marketplace and interest from our clients, to launch the business here,” says Desmoine. “Never has there been more international demand for New York than there is right now.”
Relative to other global metropolises, New York is “still good value,” says Henckels. And, says Desmoine, “If you’re interested in investment property, New York is a great location, because you can achieve high rents and there is an abundant pool of tenants.”
For those seeking a New York property as a second—or third or fourth—home, there are also the elements of culture and entertainment. “New York is a tremendously fun, exciting and cutting-edge world capital with fantastic shopping, theatre, restaurant and nightlife offerings,” says Henckels.
Despite everything that makes it so appealing, New York is not the right market for buyers looking to make a quick buck. “I think there is a potential downside for speculators—people who want to buy on Monday, sell on Wednesday and turn a profit,” says Desmoine. “It’s very hard to time the market and jump into the right building at exactly the right moment. Real estate in New York City is an asset that makes a great hedge against inflation and historically increases over time. Rapid spikes in pricing are not common, and they’re not something we should see in a healthy marketplace.”
In addition, prospective owners should be careful what they buy—and who they
buy through. “The New York market is very complicated. It’s imperative to have a well-established broker who is known to be reputable, one who isn’t just out to make a sale,” says Henckels. “There is an enormous selection of property to choose from—from 90-storey condominiums with views forever and extravagant services to private and quaint historic townhouses, or old-world cooperatives with their grand architecture.”
According to Desmoine, foreign buyers should be wary of co-ops. “The buying process takes time, and requires a level of personal and financial disclosure that overseas buyers often find too intrusive. Co-op buildings also have house rules that can limit the owner’s ability to entertain, sublet, renovate or even sell a unit.”
More attractive to foreign buyers are condominiums, which make up the vast majority of new developments in New York, says Henckels. These are, however, roughly 20 per cent more expensive than buying into a co-operative. Townhouses don’t offer the services of a condominium, but they’re less expensive than condos or co-ops and deliver total privacy, he says. Clearly there’s something for everyone chasing the New York dream.