Things to consider for New York first-time buyers when real estate prices grow
The pandemic has decreased real estate sales significantly but the market is recovering from this drop. Not only the number of deals has increased and the demand for luxury properties but also the prices. Both buyers and sellers can observe how real estate prices continue growing and the main reasons for that are the availability of new autumn inventory and a higher interest in luxury estates.
According to experts, people who plan to buy properties in the nearest future should hurry while mortgage rates are low. They explain that the chances of market collapse aren't big and the demand is higher than the supply, so there are more chances to find a decent home while the prices are more affordable.
They say that more listings added to the MSL platforms will attract more buyers who'll be more engaged with them. It will encourage the market to rise slowly.
What can first-time buyers get?
Naturally, it's one of the lowest mortgage rates in the history of real estate. However, it isn't the only benefit for them. Buyers can also enjoy stable prices and a wider choice of properties for sale. They can encourage buyers to be more active in the market and choose more favorable areas for living.
One of the most actively sold New York neighborhoods is Sheepshead Bay. First-time buyers can find over 330 apartments in this area and they're characterized by more affordable prices. The analysis of prices in the listings made it clear that such properties can be rented by people aged between 25 and 44 whose annual income is around $70,000. It's worth mentioning that the average age of first-time buyers in the US is 37 years.
Other neighborhoods that can be a good choice for first-time buyers are Prospect Lefferts, Flatbush, Ditmas Park, Harlem, Windsor Terrace, Redhook, Rockway Beach, and others. They can also pay attention to Manhattan, Inwood, Cypress Hills, Sunnyside, Flatland too.
Another thing to appeal to first-time buyers is a 20% lower down payment, lower cost of maintenance, charges, and taxes. According to one of the US real estate companies, the average asking price of the cheapest NY neighborhoods is around $350,000 which is quite affordable for employed people.
Prospect Park and its surrounding are gaining incredible popularity with buyers as well. People invest money in this area because they can get more spacious homes for the same value in this area. People would like to live close to the park and have more opportunities to leave the home being tired of being always inside caused by the pandemic. Furthermore, buying property in this area is considered to be a more financially sensible alternative to rent too.
People looking for access to the beach or vocation estate should pay attention to the Rockaways. This neighborhood can offer 2-family houses at a quite attractive price, so they can become a great investment for you. This neighborhood is a great solution for those who want to meet several goals by buying a new home. This trend has been caused by covid too since people wish to live farther from the rate race of the city and have more space to spend time with a family.
Buyers interested in central properties can also find less pricey examples for every taste. There's no need to have a very big budget if you look at the properties offered in the Upper East Side and Midtown East. They have received more inventory this year, so the competition resulted in a price decrease too. Moreover, these are the 2 largest NY neighborhoods, so the number of properties offered for sale there is over 3,500 units. The majority of homes located there were built many years ago, and there aren't many newly developed buildings there, so this area has been of great value for several years already.
It means that people who rent a dwelling in NY and plan to live there for 5-10 years can find properties that can be less expensive than renting. Probably, such buyers will help to recover the real estate market too.
The bargaining power of modern buyers
The recovery of the market and decreased income caused by the pandemic led to the situation when buyers have partially lost their power to purchase real estate. But the future doesn't look very promising for them too. Prices for real estate will continue growing as it was previously. Homes in Bed-Stuy were three times cheaper only 2 years ago, but the inflation, higher interest in these properties, city expansion, and many other factors have increased it significantly within a quite short period of time. Undoubtedly, the market is cyclical but there's no evidence of price drop in the closest future. Experts believe there will be an increase only.
According to real estate experts, the bargaining power of buyers was better at the beginning of the year. The range of homes for sale was much bigger and a smaller pace of luxury properties created more favorable conditions for buyers, but a lack of awareness about the way the market will behave prevented many of them from getting deals. However, this tendency has changed in two seasons already. Buyers returned to the market quite actively and it caused a growth in the estate prices as well. Naturally, the bargaining power has dropped too.
Increase in the number of people moving to New York
A necessity to leave the metropolis because of the pandemic was a tragedy for many employees. However, now they are coming back together with many others who move to New York from other cities. The last ones have faced a market fall in other regions and decided to become NY citizens. Many of them can boast quite big pockets, so they may be a driving power for price growth too.
Another factor to make real estate grow is in increased demand for luxury properties. Its median price has increased by 2% for a year or so. However, the biggest growth was in the cost of pricey rentals, so there is nothing surprising in the general increase of NY home prices.
Experts remind that NY has always been an expensive place to live and the possibility to buy anything on the budget offered nowadays should not be neglected. Otherwise, you may need to pay more for the same home in the closest future!