New York City is going through something that no one expected to happen anytime in the near future. An exodus.
Residents of NYC are leaving the city at unexpected rates and moving to the suburbs.
Why? To escape the population density amid this ongoing pandemic.
What this means for real estate – rental and home prices are sharply declining in an attempt to pivot to cover these losses.
The forces behind this contraction are simple: migration and demand contraction. Active listings throughout all five boroughs are up 53.2% over last year. Not surprisingly, this is affecting multiple players in the real estate market. This trend is working its way up the ladder from renter to owner, to landlord and developer- eventually reaching the banks that hold the loans.
Though seemingly dismal, there are some bright points on the horizon. This is largely due to large tech investments. Google, Amazon, Facebook, and Microsoft have all recently bought large quantities of office space in the city. Even TikTok recently purchased an empty space on Times Square. These big players know the same secret we do.
When they sell, we buy.
Investments at this time will inject cash into the market, bring jobs and the professionals who come with them – who will need places to live – and will lay the groundwork for the next generation of NYC land- and property-owners.
We believe that with positive signs like these, real estate investment in New York City will rebound quickly.