July 20, 2024

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‘New York is back’ — broker says the city’s real estate market is heating up at all levels

2 min read

The revived New York City real estate market is seeing strong demand and attractive prices relative to recent history, a top broker told CNBC on Tuesday. 

“The story that I’m seeing across the board: All segments are transacting. New York is back, and people want to be here,” Christopher Kromer, a broker with Brown Harris Stevens, said on “Power Lunch.” 

“We’re coming off a record number of signed contracts in the second quarter, and what’s driving that is buyers are seeing value. They’re sensing opportunity, and there’s a real sense of hope for an economic boom in September when it opens up.”

Kromer said potential buyers can still find reasonable opportunities, after real estate prices in the city were depressed during the height of the Covid pandemic. “For the most part, if you’re buying today, it’s probably less expensive than it would have been three or four years ago,” he said.

However, a recent report from Douglas Elliman and Miller Samuel found the median resale price for Manhattan apartments reached an all-time high in the second quarter. Average sale prices rose 12% in the quarter and topped $1.9 million, and there was also a 150% gain in sales during the same time period compared with last year.

In the second quarter of 2020, Manhattan apartment sales saw their largest percentage decline in 30 years, as residents fled the city during the Covid pandemic and brokers were largely unable to show places to prospective buyers.

Kromer said he believes the recent record median sales price is likely impacted by dynamics in the luxury market. “I think it’s probably tilted with a lot of high-end closings. The luxury market has been booming lately with a lot of discounts.”

The recent activity in the luxury market has not wiped away the city’s high inventory levels created by the pandemic, Kromer said.

“What’s driving this are more realistic sellers and softer prices,” the broker said. “We still are at near-record levels of inventory. So, the sellers are going down to meet the buyers at their prices. The buyers have options.”

On the other hand, Kromer said that markets in the outer boroughs of New York, such as Brooklyn, were “much more resilient” through the pandemic than in Manhattan. 

“People were looking for value, for space and less dense areas, and you did not see the discounts that you saw in Manhattan in the outer boroughs,” Kromer said.

A few of Kromer’s own listings in Queens and Brooklyn recently sold above asking price after receiving multiple offers. One two-bedroom co-op in Brooklyn even sold at about 8% to 9% above the price it sold at three years ago, he said. 

A single-family home in Queens was “overwhelmed with interest,” Kromer said. “We had about 50 showings within the first week,” he said, with it selling for about 10% above the asking price.