New York’s housing market is on track for robust growth after a record-breaking year. The Manhattan market in particular is heating up, with increasing volume and intense bidding wars expected in the first half of the year. On January 13, 2022, a panel by the Hudson Gateway Association of Realtors, Inc. (HGAR) and OneKey MLS discussed the reason behind this trend and what it means for residents.
The panel discussion "Getting the Deal Done – New Year, New York" featured Jonathan Miller, president and CEO of Miller Samuel Inc.; Richard Haggerty, CEO of HGAR and president and chief strategic growth officer of OneKey MLS; Marissa S. Tracey, global private banker for Citi Private Bank, NYC.
The boom in Manhattan is mainly due to the available inventory in the city versus the Hudson Valley suburbs. "The city has more to sell,” said Jonathan Miller, president and CEO of Miller Samuel Inc. “In the suburbs – and, arguably most of the country – inventory is not just low, it's insanely low. Even if inventory rises as interest rates rise, it's not going to be fully normalized.”
"We've all navigated another year of unprecedented events and are grappling with a pandemic that shows no signs of retreat. But, New York is resilient," said event host Richard Haggerty, CEO of HGAR and president and chief strategic growth officer of OneKey MLS, the regional multiple listing service for New York. "We rounded out last year with record-breaking numbers. The post-Covid recovery continued well into 2021 and we continue to ride that crest. Will we maintain the torrid pace we had in 2020, 2021? I don't think so, but we're still going to be in a very strong position in 2022."
The panel was also asked whether buyer demand will continue to outpace new inventory despite an increase in interest rates and whether or not prices will come down.
"We do think there's going to be an increase in interest rates, but we don't see residential mortgage rates going to 6, 7, 8 percent in the next two years," said Marissa S. Tracey, global private banker for Citi Private Bank, NYC. “When you're looking to make a purchase, look at your overall cost of owning that home. What is your monthly or annual mortgage payment going to be if you take out a mortgage now and lock in rates at historically low levels, and what does that enable you to have as far as purchasing power? That's something brokers should be talking to clients about, not just the cost of a home and the increase in pricing.”
The panel also considered the impact on the housing market as more employees return to the workplace, especially in New York City. “We all overstate the joy of working from home," said Joe Rand, chief creative officer of Howard Hanna-Rand Realty, and executive director of Broker Public Portal. “Working from home is not great – I have to get in my car to go to lunch. Working in the city, I had 500 amazing restaurants I could walk to. But, in terms of the impact on the residential market? If someone is living in the suburbs and now going back into the Manhattan office, they're not going to want to commute three or four days a week. They may want to get a second place in the city.”
