Gotham’s Property Bothers

New York City’s real estate market strong despite fluctuations

New York City’s luxury residential real estate market has everything: the country’s most expensive listing, stunning penthouses, condos rich with amenities, vintage brownstones, contemporary townhomes and chicly updated pieds-a-terre. What it doesn’t have now is certainty. Sales cooled off in the summer (as they always do seasonally) and real estate pros are anticipating an uncertain fall due to rising interest rates and inflation, coupled with recession fears.

Despite prevailing macro-economic conditions, prime Manhattan and Brooklyn real estate remains a portfolio must-have for industry talent and power players, while up-and-comers and belowthe-line buyers venture further out to red-hot Brooklyn neighborhoods such as Bushwick and Bay Ridge, and outer Queens, though not Staten Island just yet.

Predicting where the market will go next is difficult. Caution abounds. “It’s safe to say, whichever way the market heads, it won’t be nearly as dramatic as it has been or as dramatic as other markets,” says Sotheby’s Intl. Realty’s Jeremy Stein of the Stein Group. He sees the market as being in neutral territory, and unlike 2021 and early 2022, neither buyers nor sellers are favored. This comes after a 16-month run that ended in May, when “the volume of sales was historic and epic,” Stein says.

Blue-chip upscale properties still draw interest: His firm is representing a penthouse in Soho’s iconic Romanesque-revival style Puck Building listed for $35 million.

“2021 was the greatest year in history of New York City real estate,” says Pamela Liebman, president and CEO of Corcoran, and not a year to benchmark for comparison, she contends (Liebman is a featured Realtor in Netflix’s reality series “Buy My House”). She points out that the city is still above 2019 sales numbers, even though climbing mortgage rates are already impacting sales. Liebman has seen an increase in interest-only loans while the luxury segment historically favors all-cash buys.

“Entertainment executive-types are attracted to top-of-the-line, midtown condos,” she says.

Corcoran reps a triplex penthouse on three floors overlooking Central Park at 111 W. 57th. The residence is listed for $66 million in a boutique-sized, 60-unit building that checks all the boxes: full service, plenty of amenities, privacy, views and security.

“I think it would be an understatement to say that New York City is back: luxury renters and buyers are returning home,” says Compass’ Carl Gambino. His experience: there may not be as many bidders on properties, but there is still a ton of activity. Year-to-date, 841 homes priced at $5 million-plus have sold in Manhattan through August, per Compass stats. Sales of homes $5 million-plus increased 35.6% in the first eight months of the year, compared to the same period last year and the first eight months of pre-pandemic 2019, notes Gambino.

Penthouses and townhomes are always in demand, he says. He’s representing a 1919-built West Village townhouse for $25 million.

“Pre-war townhouses are always in favor,” says Abdul Muid, founder and principal of Ivey North, which specializes in Brooklyn real estate. “They are not building any more of them so there’s a limited supply,” he notes of the brownstones, which are loaded with architectural details and often on treelined, landmarked blocks.

Inventory is still relatively low. Those looking for value propositions consider the outer edges of Brooklyn with a lot of activity in Flatbush, East Flatbush and Canarsie.

Ultimately, “Buyers want to see more certainty,” he says.

As Corcoran’s Liebman notes, the market is solid: “New York is one of the world’s capitals. People still want to have a piece of real estate here.”