Manhattan’s real estate market has been booming as if it wasn’t part of the U.S. We found several factors that keep the market growing, and a better understanding of Trump’s warning about the market’s fleeting characteristic.
First and foremost, there’s the bonus-money trend, where lucky workers of successful markets, as Wall Street, have been awarded bonus increases, that have allowed a stronger buying power.
“Obviously, the market was helped first by the rumor and the reality of bonus money,” said Frederick W. Peters, president of Warburg Realty.
Secondly, there a demographic flux, bringing more and more people in the city: “But I also think we’re just in one of those demographic upswing periods,” Mr. Peters added. “More people are moving into the city, fewer people are moving out, and the rental market got much tighter over the course of 2006, which once again made buying a more attractive option. You put all those things together, and the market sort of entered the narrow part of the hourglass.” Explains Peters.
Another factor is the Euro’s strong value that has increased Europeans’s purchasing power, and when comparing the costs between NYC an London, NYC is like a no-brainer:
Other buyers constitute of parents getting apartments for their children, and baby-booming who choose to retire in the dynamic city instead of the typical and too-calm Florida.
Nevertheless, no matter how the market may be flourishing, there’s an apparent threat to the market in the availability of credit
“For the first time in over a year, there is some negative talk – about the credit markets and whether or not this will permeate the New York City real estate market,”
(As Trump predicted) said Pamela Liebman, president of Corcoran. “As of right now, it hasn’t. There has been no slowdown.” She said the biggest concern among her agents is finding enough inventory to satisfy demand.
Via New York Times
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August 20, 2007Hogan Does Know Best
