Recent Trends Shaping NYC Residential Real Estate in 2024
The COVID-19 pandemic was rough on the New York City residential real estate market, but four years on from the global pandemic, things are largely back to normal. After a gradual recovery throughout 2021 and 2022, the New York market as a whole shifted from a buyer’s to a seller’s market, due to increased interest in the area and a relative lack of supply. Prices held steady throughout 2023, and in 2024, the median price for a home in New York City hit $850,000, representing a 5.4 percent year-over-year increase.
Stout home prices, a lack of supply, and the highest interest rates in decades has made the past two years a difficult time for homebuyers in New York City, but there are indications that this trend will begin to reverse over the back half of 2024. The first of a series of interest rate cuts is expected in September, which will begin the process of making mortgages more affordable. At the same time, there were 2,709 new listings in July 2024, which was a 3.1 percent increase over last year, indicating that supply pressures are starting to ease. While it will likely remain a seller’s market for the time being, homes should become more attainable, which is good news for prospective buyers.
At the same time, a number of trends are shaping the market in 2024. From an increase in condo listings to the starter home market in Queens becoming more competitive, these are the trends that can be expected to continue over the next six to 12 months.
Sources of Relocators
A large majority of home purchases in New York City are the result of people moving to the area, and it is important to understand where they are coming from to have a better grasp on the market.
This summer, the top five cities from which people were relocating to New York City were Sheboygan, Wisconsin; Pittsburg, Kansas; Visalia, California; Gainesville, Florida; and Quincy, Illinois; according to Redfin data from June – August 2024. Laredo, Texas, also made the top 10 at number eight, indicating the city’s broad appeal across the eastern half of the country.
Destinations for Departing New Yorkers
Home sellers are just as important when studying the real estate market as those who are buying, and a large percentage of those who sell do so because they are moving away from New York City. The number one destination for departing residents of New York City is Miami, Florida, with Orlando and Tampa also both making the top 10 at numbers five and eight, respectively. In addition to Florida, departing residents are also heading to other major city centers along the East Coast, including Philadelphia (number two), Boston (number three), Washington, DC (number four), and Albany (number seven). Atlanta made the top 10 at number six, while Los Angeles is the only Western city to make the list at number nine.
Queens Starter Home Market Heats Up
Inventory in Queens is well behind that of Manhattan and Brooklyn, with only 534 new listings in July 2024. This is a nearly 9 percent decrease in listings over the past year, largely caused by a decrease in co-ops in the area. Co-ops have historically been a steady source of starter home purchases, and their recent decrease has made Queens more difficult for entry-level homebuyers. However, some neighborhoods remain relatively accessible. For instance, there were nearly 200 new listings in the Forest Hills neighborhood between May and July, with a median asking price of just over $400,000.
Condo Listings Increase While Co-ops Decrease
As mentioned above, co-op listings have declined over the past year, falling nearly 5 percent this July to hit the lowest level since 2016. At the same time, condo listings have skyrocketed, with the condo market outpacing the co-op market for the first time since 2019. There were 3,694 new condo listings in New York City from May through July, representing a 5.5 percent increase from last year. July 2024 alone saw over a thousand new condo listings, indicating that this growing trend is unlikely to slow down anytime soon.
Condos have relatively flexible financing terms and are simple to apply for, making them somewhat more appealing in what has been a difficult market for buyers over the past few years. Co-ops, on the other hand, tend to require a minimum 20 percent down payment, and often have boards that can turn away buyers for a wide range of reasons.
Manhattan Has the Most New Listings in the City
In line with historic trends, Manhattan’s real estate market remains hot, with the largest number of listings in the city at 1,124 in July—a 3.2 percent increase over the same month in 2023. In addition, more than half of the New York City neighborhoods with the most new listings in May–July 2024 were in Manhattan.
