The New York City residential building market shifted gears this year. With mortgage rates elevated and inventory still below pre-pandemic levels, buyers competed for limited supplies.
In the multifamily sector, free market buildings in good locations continued to appeal to buyers. They accounted for 89% of NYC’s multifamily dollar volume in the third quarter.
Condos
New York City’s condo market has stalled after years of growth. The gap between housing costs and wages has widened as developers have struggled to balance the supply of luxury units with the demand for affordable apartments. This trend has exacerbated the city’s affordability crisis and led some residents to crowd into smaller spaces. The average asking price for a one-bedroom Manhattan condo has remained steady this year.
In 2021, the city recorded 192,700 new condos completed, down from 207,400 in the previous year. The decline was primarily caused by the coronavirus pandemic and temporary construction halts, but the city also saw a drop in new housing permits.
The NYC Department of Finance published tentative assessments in mid-January, and the deadline to protest excessive increases is March 1st. Cooperatives and condominiums are encouraged to review the process for submitting a protest online.
This month the average asking price for a one-bedroom apartment in New York City rose, while two-bedrooms stayed the same and three-bedrooms declined. The Bronx’s prices have stayed fairly consistent, while Manhattan and Brooklyn are more expensive.
A looming concern for many co-ops and condos is the requirement to pay prevailing wage to all building service employees, beginning in 2023. This law affects buildings whose assessed value, as determined by the NYC Department of Finance, averages $60,000 or more per unit, including most in Manhattan and a few in Brooklyn. Many buildings already pay prevailing wage, which is the package of wages and benefits in the residential contract of Local 32BJ, but some may be forced to raise carrying charges or increase staff in order to keep their abatement.
CNYC has been following this issue closely. On February 12th, the City Council will consider a bill (Introduced by Council Member Levin) that would create a Commercial Rent Guidelines Board and restrict the ability of cooperatives and condos to set retail/office space rents. CNYC is strongly opposed to this bill.
Join the conversation on CNYC’s Facebook Group and Twitter feed. You can also follow the discussion in person by attending our monthly meetings and our virtual conferences. Each month CNYC offers 42 classes to its members, and a virtual version of the Conference is available in the 11 AM timeframe.
Co-ops
Co-ops are a unique type of real estate ownership in NYC. Unlike condos and single-family homes, which are owned by individuals, co-ops are owned by a corporation that includes all the apartment residents. When you purchase a co-op, you’re purchasing shares in the corporation and becoming a tenant with a proprietary lease. The more shares you buy, the greater your stake in the building. Co-ops are often governed by democratically elected boards of directors. These boards are responsible for managing the co-op and ensuring that shareholders follow building rules.
One of the benefits of owning a co-op is that they are often cheaper than comparable condos. This is especially true for HDFC co-ops, which are some of the most affordable in the city. You’ll also save on closing costs because you don’t have to pay mortgage recording tax or title insurance.
Another advantage of co-ops is that they tend to be less transient than condos. This makes them a great choice for people who value stability and want to plant roots in a community. However, buying a co-op can be tricky because you’ll be subject to more scrutiny from the board than if you were buying a condo.
The co-op market in New York has cooled down a bit this year, but it is still an excellent option for people who want to live in a vibrant neighborhood. The market is particularly strong in Manhattan, where prices are at a record high and demand remains high. The market has slowed down slightly in the outer boroughs, but that’s partly due to a lack of supply and higher interest rates.
The average price per square foot for a new construction condo in NYC is $428, while co-ops are priced at a more reasonable $328. This difference is largely the result of the fact that condos are more expensive, but it’s also because many investors are moving away from co-ops in favor of condos. Nonetheless, co-ops remain an excellent investment opportunity for those who are willing to work with a knowledgeable broker.
Rowhouses
Row houses make up much of the city’s historic residential building stock and can sell for millions. Many people have a strong affection for these structures and can often identify the architectural styles when they see one, but not everyone knows that not all rows of homes are created equal. A quick guide to the different types of NYC rowhouses will help home shoppers distinguish between the varying varieties that populate neighborhoods throughout the boroughs.
Generally speaking, a row house is defined as two to three story brick or brownstone dwellings built shoulder-to-shoulder in uniform rows on streets in the midst of higher-density urban areas. The term can also be used to refer to any number of similar buildings lined up side-by-side in a block, including apartment complexes and other multi-family housing.
The history of the row house in New York City can be traced to the settlement pattern that emerged in Manhattan and waterfront Brooklyn in the 17th century. These early houses were wood-framed and load-bearing; later designs favored a frontage of brick or stone. Row houses became popular as builders sought ways to maximize development on crowded lots.
In the 19th century, Federal-style row houses dominated. After periods of Greek Revival and Gothic Revival architecture, Italianate style held sway from the late 1840s through the mid-1870s. Queen Anne, Neo-Grec and other architectural styles soon appeared as well.
A common feature of New York row houses is the prominent stoop, or entrance staircase, which runs flush with one side of the building. The stoop is usually enclosed by a wide front porch. In the early days of the row house, it was not uncommon for owners to live in the rear dwelling while renting out the front.
While the row house was once ubiquitous in older parts of the city, its popularity declined with the growth of the boroughs. By 1900, the city had surpassed two million residents and technological advances rendered traditional brick row houses obsolete in many of the urban districts. However, the design continued to be a popular option in the boroughs outside of Manhattan as builders adapted it to different tastes and income levels.
Detached Homes
Whether you’re looking to buy or rent in the NYC real estate market, it’s important to have all the facts before you make a decision. New York City offers many different apartment types, including townhouses and detached homes. Choosing the right one for your needs depends on several factors, such as budget and lifestyle.
A fully detached home is a free-standing residential building that has no other dwellings attached to it. These houses are usually larger than townhouses and often come with more outdoor space. They’re popular with families, who need room for kids and pets to play. Detached homes are also more expensive than townhouses. However, they have a lower maintenance cost because homeowners are responsible for only their own house.
Detached homes are harder to find in Manhattan (unless you’re interested in a landmark such as the Frick), but they can be found in outer-borough neighborhoods. These houses are often wider and more spacious than townhouses, and they can offer the flexibility of making major renovations. Townhouses, on the other hand, are often governed by homeowner’s associations, which means that owners share in the cost of maintenance.
If you’re thinking about buying a new home, you should know that New York City has a high rate of foreclosures. This is because the housing market here has been impacted by rising mortgage interest rates, which have made it more difficult for people to purchase properties. If you’re considering purchasing a home, it’s a good idea to speak with a real estate lawyer before you finalize your purchase.
While it might seem like the housing market is in a slump, experts say that it’s still attracting buyers from around the country. StreetEasy search data shows that there’s strong demand for NYC rentals from people who want to move to the city from other metros. This trend could continue into the future, even if interest rates do rise again.
As the housing market continues to recover, it’s a good idea to stay updated on local trends and developments. You can do this by checking out New York City’s detailed residential market reports. These reports include sales stats and trends for individual neighborhoods and boroughs. The reports also provide a year-over-year evolution of home prices. This information can help you predict future trends and decide when to buy or sell.
