Posted on August 15, 2016
NYC Real Estate Market is Ripe & Ready for Investment
The NYC real estate market is ripe and ready for investment agenda and opportunity; that’s the case whether discussing commercial or residential properties. A vested interest in real estate worthy venture for those thirsty to meet the ceaseless business and residential needs of New York City’s transplants and native New Yorkers.
With the city’s vast and growing population, what’s evident is a need for an abundant range of housing options. The undying needs of the populace can be met with renovated, flipped and updated spaces throughout the boroughs and the surrounding tri-state areas. A diverse feature of housing types, including converted spaces, tend to be available in ample supply. Even the Wall Street Journal has reported in July of this year, on NYC’s amassing market-rate rental inventory.
In the years to come, NYC is expected to witness a surge in new rental apartments, though it’s still a debate whether this growth will be presented as a ripple or a wave. In Brooklyn and Queens predominantly, the past three years has seen that 38,000 market-rate rental units were introduced. Also, 14,686 has been added this year and 17,044 new apartments will be completed and put on the market in the upcoming year, which marks a new high.
Executives and analysts alike are anticipating rent decreases and flattening, leading to a decrease in property values. Certainly, this a positive for renters, but property managers don’t feel quite the same. Nonetheless, buildings with rent-stabilized apartments continue to offer investors steady increases, due to deregulated apartments, even if market-rate rents continue to remain flat.
Meanwhile, low vacancy rates and rising rents have made the rental building market. The online real-estate company Ten-X has reported that market-rate vacancies of more than 10 percent by 2017. Also, market-rate apartments in 2019 could offer zero percent growth. As the number of new rental become available, prices, particularly higher-end apartments, will be increasingly influenced by proximity to transportation and amenities, such as dryers and washers.
Of course, there are differing opinions regarding the new apartment surge and how it will impact the market. According to Ten-X, annual increases represent a fraction of the area’s housing units. However, others said the there’s an undersupply of units, particularly as New York universities and research centers to beckon faculty and students to New York City.
Jeffrey Levine, chairman of Douglaston Development LLC, believes the development of new apartment rentals has come in waves, particularly after the Great Recession and the expiration of the 421-a, the property-tax-exemption programs. Buildings with a market-rate and rent-stabilized apartments will continue to attract investors.