Tomorrow Never Knows — NYC 2019 Real Estate Forecast
What’s Next For NYC Real Estate?
The holidays were over in a flash, and here we are now in 2019. You are either hitting the ground running, or slowly rejoining the scrum. Either way, most of us are grappling with that return to work mode. Hopefully you got some much needed rest, spent some time with people you care dearly for, and did at least a few things for your soul. And I hope that you watched that bizarre Bill Murray “A Very Murray Christmas” Netflix special. Have you seen that thing? I have no idea if it is good, I just know it’s spectacular.
We stayed in New York, spent time with our kids and friends, took a trip up to Hudson, and generally took it easy. It was wonderful too.
It strikes me that every new year is traditionally filled with reviews, resolutions, and predictions. I’ll spare you my Top Albums/Songs list, and resolutions aren’t my thing. But predictions on the other hand, those can be quite interesting. When it comes to New York City real estate, one point of caution — the truth is no one really knows what will happen next.
That said, here’s what I predicted for 2018 last January. With Williamsburg softening, Amazon arriving, and interest rates shifting as predicted, most of my 2018 calls look prescient in retrospect.
Here’s what may be ahead of us in 2019:
• This “Buyers Market” will continue, but deal cadence will quicken as sellers get more realistic about pricing.
• The rental market will be flat.
• Interest rates will end the year higher than today’s 4.375% for a 30-year fixed loan. Come December 31st 2019, rates will still be historically on the low side.
• Smart buyers will increasingly turn to adjustable rate mortgage loans.
• There will be at least one more big tech company that ups its NYC presence a la Google and Amazon.
• The Amazon effect will be marginal outside of Long Island City. Queens will not become the Brooklyn of 2019. Besides, Hudson NY has a lock on that.
• Full shutdown or partial shutdown…people who buy anywhere along the L-train line will get great value.
• Clinton Hill, Ft. Greene, Hamilton Heights, Prospect Heights, Sunset Park, Mott Haven, Flatbush and Long Island City will outperform the market.
• Tribeca, Hudson Yards, Soho, The Upper East Side, Midtown and suburban Westchester, New Jersey and Long Island will struggle relative to the market.
• Kristaps Porzingis and Led Zeppelin will not play this season.
Again, there are no iron clad guarantees. You never know what tomorrow will bring. Yesterday, we were sure the L Train shutdown was a done deal. Today, we got word that Governnor Cuomo will change this to a partial shutdown.
The real estate market, like most markets, is influenced by news cycles, elections, legislation and emotions. But, if you believe in New York, it’s almost inevitable that if you have a long horizon, being a buyer will produce rewards.
I hope you had a great holiday break and am wishing you every happiness for 2019. I consider myself lucky to have you in my orbit…thanks for reading, interacting, and being part of my life.
Happy New Year y’all,
- Jack
