When 2020 started, New York's real estate market was still going strong. Then, of course, the pandemic changed everything. On March 7, 2020, Governor Cuomo declared a state of emergency. On March 12, Broadway shut down, and event venues postponed events with more than 500 attendees. Schools closed nationwide a few days later, and New York closed gyms, on-premises dining, movie theaters, and local governments reduced their workforces by 50%. At this point, unemployment was soaring.
The Pandemic Real Estate Market
According to the New York Times, the bottom dropped out of the real estate market, with rents decreasing from a median $3,059 a month in March to a median $2,776 a month in November. Compared with 2019, this 12.7% drop exceeded the largest drop in rent prices since the Great Recession. While the rental market bottomed out and sales dropped steeply overall, it was a different story for luxury real estate properties.
More affluent New Yorkers headed for the suburbs for virtual work and school, creating a surge in vacancies at the top of the market. This suburban exodus left the best discounts on more expensive properties as landlords struggled to fill empty rental properties. Landlords began offering concessions, months of free rent, and steeply discounted prices.
NYC's Luxury Real Estate Market
In the last quarter of 2020, the luxury real estate market in New York City was looking good. Bloomberg reports that during that quarter, sales of homes exceeding $4 million were a bit above the same period in 2019. But COVID bargains still abound and may be driving current real estate sales. Additionally, urban properties are a good bet. While suburban real estate sales will still increase, they aren't booming as they did even a few years ago. People want to live in the city, and right now seems to be a good time to find a good luxury real estate bargain in NYC.
If you're buying NYC real estate in 2021, the Law Offices of Melvin Monachan, PLLC is here to help. We can guide you through the closing process and help reduce the uncertainty of purchasing a new home. Call us at (516) 714-5763 to schedule a consultation or contact us online.