NEW YORK, Dec. 6, 2017 /PRNewswire/ -- Transportation
shakeups will continue to alter the New
York City grid in 2018, including the looming closure of the
L train and the continued expansion of the East River ferry
service. These changes will play an integral role in the moving
decisions of buyers and renters, and will noticeably impact real
estate prices in surrounding neighborhoods next year, according to
StreetEasy's 2018 predictions.
Sales markets in Manhattan and
Brooklyn will most acutely
experience slower growth, while Queens will see strong demand as
first-time buyers flock to the borough's comparably less expensive
homes. The slump in the luxury market will continue through 2018,
putting increasing pressure on an expanding range of homes at
multimillion-dollar price points.
New York City rents will
continue to grow at an anemic pace, while landlord concessions
become the norm.
StreetEasy's 2018 Predictions
Transportation changes will
drive new demand in neighborhoods across the city.
Neighborhoods where new transit options are being added --
like those along the expanded East River ferry line -- and
neighborhoods where transit is temporarily halting -- like
Williamsburg's L train -- will receive a flurry of interest as
New Yorkers seek either a more convenient commute or a bargain.
These transportation changes have already impacted rents and prices
in 2017, but their effects will be even greater in 2018.
Luxury prices will hit new
lows, testing the nerves of high-end buyers. As luxury
developers continue to build, the swell of supply will far outsize
the number of eligible buyers. Luxury buyers with a home budget of
$10 million or more will be hesitant
to buy in a market with rapidly falling prices. The current luxury
housing market slump comes as the stock market is booming. Should
the global economy show signs of a slowdown, steep price cuts will
follow.
Homes under $1 million will see heightened competition,
prompting more buyers to turn to the outer boroughs.
The never-ending supply of luxury homes has done nothing to
staunch the city's affordability crisis. While the city's economy
booms, modestly priced homes will be in high demand. In 2018, homes
priced below $1 million will see more
competition than ever, and more buyers who previously hadn't
considered the outer boroughs will look to these areas to stay
within their budget.
Rents will fall and concessions
will rise. A pipeline of new buildings will limit increases in
rents and give a negotiating edge to prospective tenants. Rents
will likely fall to meet market demand, and even then, landlord
concessions won't go away. This combination may cause more renters
to consider moving, as they notice enticing deals being offered at
buildings comparable to where they currently live.
Renters won't be fazed by the
quirky amenity craze. Developers and property managers will go
to creative new lengths to make their buildings stand out. Cooking
classes, wine tastings, and co-working spaces will become the new
norm in high-end buildings. However, affordability will continue to
win the day in the minds of NYC renters, who will opt for less
expensive rent over the building with unique perks.
Statement from Grant
Long, StreetEasy Senior Economist:
"With next year's building boom promising to expand luxury
market woes at the very top of the market, 2018 will mark slow
price growth across multimillion-dollar price points and a
landscape in which high-end buyers enjoy the upper hand in
negotiations.
"For renters, 2018 is your year. The combination of ever-present
landlord concessions and rents growing at a snail's pace will cause
the market to sway more heavily in favor of the renter. Even
renters happy with their current home should do their research and
ask for a deal before renewing their lease — check comparable
listings for the pulse of the market in your neighborhood, and
don't shy away from asking landlords for a month free or
negotiating a lower rent.
The city's reliance on an aging transportation infrastructure
will face tough tests in 2018, but buying in a rapidly changing
neighborhood along a major commuting corridor will remain one of
the best bets in city real estate. Traditionally that has meant the
train, but with an expanded fleet of ferries on the East River, we
also expect more New Yorkers to take to the water on a daily
basis."
View StreetEasy's full 2018 predictions report here:
http://streeteasy.com/blog/2018-nyc-housing-predictions
About StreetEasy:
StreetEasy is New York City's leading local real
estate marketplace on mobile and the web, providing accurate and
comprehensive for-sale and for-rent listings from hundreds of real
estate brokerages throughout New York City and the
major NYC metropolitan area. StreetEasy adds layers of
proprietary data and useful search tools to help home shoppers and
real estate professionals navigate the complex real estate markets
within the five boroughs of New York City, as well
as Northern New Jersey and the Hamptons.
Launched in 2006, StreetEasy is based in the Flatiron
neighborhood of Manhattan. StreetEasy is owned and operated by
Zillow Group (NASDAQ: Z and ZG).
StreetEasy is a registered trademark of Zillow, Inc.
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SOURCE StreetEasy