New York real estate agents offer buyers waived fees and free rides
THERE was a time, not too long ago, when New York apartments were snapped up before they were even built. All-cash offers, over the asking price, were the only guarantee of securing a property in Manhattan.
But after the coronavirus abruptly reversed a decade of astronomical growth in the property market, desperate developers are now digging deep to secure a sale or a new tenant.
Agree to tour one of Manhattan’s newly built skyscrapers today and agents will send a car to come get you.
Commit to buy a flat and they will cover thousands of dollars in fees.
Demand for rental property has also fallen in London over the pandemic. But the trend is dwarfed by New York, which has seen an exodus during a year of lockdowns and restrictions.
Manhattan has an estimated 8,400 unsold new development units, plus 20,000 vacant apartments for rent.
At one new condominium in the Tribeca area, developers are offering to pay three years of real estate taxes and charges, as well as a free storage unit, to the eventual buyer of a three-bedroom apartment on the 12th floor, priced at $3.75 million (£2.7 million). Michael Paget, a 33-year-old charity worker, said one estate agent had been so desperate to shift a one-bedroom apartment in Brooklyn overlooking the Manhattan Bridge that he offered him the first three months rent-free.
“They even told me I could have a free gym pass, but I already had one so it was a bit useless,” he said. “There was a definite desperation about it.”
In Manhattan, median rents dipped to a new low of $2,700 per month, marking the borough’s cheapest housing price recorded since 2010.
By comparison, in the weeks before New York’s Covid-19 outbreak in March 2020, the median asking rent was more than $700 higher at $3,417 per month. In leafier Brooklyn, median rents slipped 10 per cent year-on-year to $2,390 – the lowest since 2011.
Even with mass vaccination in sight, it could take years for rents to return to pre-pandemic levels, because of permanent job losses and a glut of luxury rental inventory, said Nancy Wu, an economist with StreetEasy.
On the flip side, deep discounts have given renters the chance to live in previously unaffordable neighbourhoods.
Tens of thousands of new listings across the five boroughs of New York City have become accessible to families that use federal housing vouchers.
In the Chelsea neighbourhood, for example, voucher-affordable inventory rose by more than 400 per cent in 2020.
But Ms Wu does not think the current slump will last forever. With the presidential election settled, easily available vaccinations and mortgage rates expected to remain near record lows, the coming months could be different.
“As long as sellers keep giving discounts and are willing to negotiate, we’re going to see perhaps one of the busiest sales seasons ever,” she said.