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Why 2019 Could Be An Amazing Year To Buy Nyc Real Estate

Why 2019 Could Be An Amazing Year To Buy Nyc Real Estate

New York real estate always rises. At least that has been the overwhelming trend since 1940. There’s no reason to think it will change. However, the combination of rising interest rates, the new tax law, wage stagnation, political uncertainty and over saturation of new condos means you might prefer to consult with your tea leaves rather than draw any firm conclusions about the NYC real estate market in 2019. Kidding aside, while difficult to predict market trends for the new year, here are a few strategies to keep in mind that will ensure you get as good a deal as you can.

Firstly, if you are thinking of buying a condo, the great news is that there are deals to be had. The glut of new construction means that developers will be open to offers and willing to negotiate. In Manhattan, according to The Real Deal, the inventory of new condos is expected to hit 7,900 units, double that of the last few years, according to appraisal firm Miller Samuel who predict a sales backlog of 4.5 years. A frenzy of permit filing occurred back in 2015, when there was a rush to get them in before the state’s 421-a tax abatement expired in January 2016. The effects are now being felt. The neighborhoods with the newest construction will be the Financial District, South Street Seaport, Lower East Side and East Village.

In Brooklyn, StreetEasy predicts the Downtown area will profit most from the L Train shutdown. Its abundance of luxury buildings, transportation and phenomenal rate of new construction (1000 new units came on the market in 2018) will make this comparable to Williamsburg and a great place to buy with developers again likely to cut deals. There are many Brooklyn areas seeing condos take to the skies with cranes dotting the once low-rise landscape. Crown Heights and Bed-Stuy are going through a phenomenal growth phase with new coffee shops and vegan eateries – harbingers of gentrification – on every thoroughfare.

Elsewhere, the Mott Haven section of the South Bronx is morphing at an alarming rate. Long Island City in Queens, buoyed since Amazon’s announcement to locate there, has seen condos selling at a phenomenal clip. Expect surrounding areas and those with an easy commute by subway to also be affected.

Amazon’s choice to pick NYC as one of its two new HQs highlights the city’s enduring allure and why it has continued to grow, despite fluctuating market conditions. It’s also why Google recently announced a major expansion in the city and why developments such as Hudson Yards and Essex Crossing continue to get funded. The Big Apple is the media and financial capital of the world and thus the jobs are here. Momentum breeds momentum.

CEOWORLD Magazine stated that all is not lost for sellers in 2019. Those that stand to gain the most will be owners who purchased their properties over five years ago, realizing a profit margin of 50 percent. They will have the equity to buffer any slowdowns and will be in a great position if they want to buy elsewhere. Taking this one step further, all cash buyers, as always, will stand to gain most from rising interest rates and the abundance of new construction. For investors, selling long held property by doing a 1031 Exchange (deferring tax payments) into new construction could be a savvy move, particularly when developers are so willing to negotiate.

So, don’t believe the hype — 2019 could be the best year ever to invest in New York City real estate.