Real Estate Sales Execs Still Bullish On New York’s Housing Market in 2023
Real Estate In-Depth | February 16, 2023
WHITE PLAINS—Sales executives from Related Cos., Compass and Sotheby’s believe that now that mortgage rates have stabilized, investor interest, including demand from foreign buyers, has returned to the New York metro area housing market.
The Hudson Gateway Association of Realtors, Inc. and OneKey MLS recently hosted a virtual panel featuring real estate experts who discussed trends and predictions for New York’s housing market. The “New Year, New York: An In-Depth Look at NY’s Real Estate Market for 2023” featured Kevin Brown, senior global real estate advisor at Sotheby’s International Realty; Elizabeth Stribling-Kivlan, senior managing director at Compass; Sherry Tobak, senior vice president of Related Cos., who oversees sales at Hudson Yards and Richard Haggerty, CEO of OneKey MLS, the regional multiple listing service that covers nearly a dozen counties in the greater New York City area from Manhattan, to Suffolk, Westchester and Sullivan. The event was sponsored and moderated by Brian D. Tormey, NTP, president of TitleVest, a New York City-based provider of title insurance and related real estate services.
The panel weighed in on 2022 statistics, economic factors, interest rates, inflation, and the shift from a buyer’s to seller’s market, plus they offered predictions on property values and the return of foreign investors.
“If you look solely at the numbers and compare 2022 to 2021, it looks grim, but you have to give it context,” said Haggerty. “While the numbers are down about 30%, we have to focus on two things: We lost all seasonality to the market during the 2020/2021 years, when we had a rush of activity. That wasn’t sustainable.”
He added, “Also, buyers were taking a pause at the end of 2022 as interest rates were going up. It’s what we expected. Now, we’re seeing interest rates come down, more normalcy and a return to seasonality.”
“This is a temporary moment – markets ebb and flow, that’s what they’re supposed to do,” said Stribling-Kivlan of Compass. “With interest rates going up, everyone was so concerned about where the world was going … it’s very easy to look at Instagram or a headline and not delve into the fact that prices have almost never been higher, rents are still very expensive, there’s so much less inventory … Now, activity is already picking up.”
The panel agreed the New York City market is seeing an increasing flow of foreign buyers, particularly from Asia, but also from Canada, South America and Central America.
“Foreign investors are coming back,” said Related’s Tobak. “I’m really excited about China opening up again—as luxury buyers, they are very savvy, very smart, they follow market trends and aren’t afraid of jumping into new situations, i.e., Hudson Yards. We’re also seeing Europeans, certainly Brits, and I met a couple from Australia who was buying here. This is New York, everyone wants to be here, everyone wants a piece of the action. I’m very bullish on the market for 2023.”
The panel also discussed whether the market is shifting to favor buyers and if sellers are willing to make concessions.
“Sellers are more realistic than brokers,” Brown of Sotheby’s said. “When I’m taking buyers out, I always tell them, ‘There are no bargains in New York City.’ My job is to find good value. You read about the ‘aspirational priced’ sales, but that’s exactly what they are. The great majority of sales are selling 4% to 6% off the last asking price. In the next two quarters, we’re going to be adjusting.”
Haggerty asked the panel about “hidden gems” or neighborhoods they’re particularly bullish on in terms of value for 2023.
“Queens is such an overlooked borough. It’s closer to Manhattan, and there’s some really great housing stock. Queens is a launching pad for so many incredible people, ideas and cultures and we don’t give it enough credit,” said Stribling-Kivlan.
Brown agreed on Queens, for its neighborhoods. “We’ve lost so many of our neighborhoods in New York,” he said, and added, “Manhattan is always reinventing itself. Right now, the Upper East Side is where the values are.”
The panel also shared predictions for New York’s housing market in 2023.
“I’m looking to 2023 as a very important year for all of us,” said Tobak. “Yes, interest rates are high and prices are lower than they had been in the year or two prior, but they’re going to catch up to each other. So, consider if you’re able to buy something now that you know is underpriced but is going to go up in value.”
“Overall, 2023 is going to be a very nice year … we’re going to be going up, up, up,” Brown said, but also cautioned real estate professionals to be prepared for 2024: “That’s going to be a national election year and people in New York City get very distracted, which just throws off our market. So, to all the brokers in NYC, enjoy 2023!”
The webinar was part of the “Be Your Best” series created by HGAR and OneKey MLS, to help Realtors and agents navigate a changing landscape amid the pandemic.