November 2024

November Newsletter —

Thanksgiving and the winter holidays are approaching, and a chill is in the air. In this month's newsletter, we take a look at the state of the market, discuss the latest real estate trends, and more.

Sales Market Update

On November 7th, the Federal Reserve further reduced interest rates—this time by .25 percentage points. That brings interest rates to a range of 4.5% to 4.75%. Inflation levels are still just above the Fed's stated 2% goal as we head toward the end of the year. Mortgage rates are higher than they were in September 2024 following the first rate cut, but considerably lower than they were at the beginning of 2024. In theory, if the Fed continues to decrease rates, mortgage rates will eventually find a steady lower equilibrium. However, the new administration's economic policies will be influencing those numbers as well.

It's hard to say at this point what those policies will be or how they will impact New York City real estate specifically, as city and state governments are often more influential on a local level. For a more detailed look at what we might expect under the new administration, check out this article from Forbes.

This fall's home-shopping season is turning out to be the strongest since 2021, likely due to the impact on the Fed's September interest rate cuts on mortgage rates. Median asking prices throughout the city have held relatively steady since April 2024, hovering at or around $1.1M. For the remainder of Q4, we can expect the typical seasonal slowdown to begin after Thanksgiving, and the usual surge in sales activity as everyone looks to close by the end of the year.

In Manhattan, the market remains tight, as the Fed-influenced fall surge in contracts signed has quickly eclipsed the year-over-year increase in new inventory. Manhattan is leading the other boroughs in year-over-year increases in contract activity for yet another month, following 28.7% in September with 29.4% in October.

Competition continues to be fierce in Brooklyn, where inventory fell 7.1% year-over-year. With a year-over-year increase in contracts signed of 27.5%, the Brooklyn market doesn't appear to be cooling off any time soon. As of September, the borough's median asking price went up year-over-year by 5.4% to $1.1M.

The luxury market's slow growth after a year of stasis carried on into October, a change spurred at least partly by sellers in the luxury market becoming more negotiable and pragmatic in their asking prices.

Overall, experts are labeling this a Goldilocks market—not too hot, not too cold —with relatively equal power between buyers and sellers. The next few months of federal policy will have a lot to say about how long that lasts.

+0.0%

Quarter-Over-Quarter

+6.4%

Year-Over-Year

+39.2%

Quarter-Over-Quarter

+29.4%

Year-Over-Year

Average Days on Market

-13.0

Quarter-Over-Quarter

+7.8%

Year-Over-Year

Inventory

-1.1%

Quarter-Over-Quarter

+6.0%

Year-Over-Year

Source: Compass October 2024 Manhattan Market Report

+9.7%

Quarter-Over-Quarter

+11.6%

Year-Over-Year

Contracts Signed

+25.1%

Quarter-Over-Quarter

+27.5%

Year-Over-Year

Average Days on Market

+8.1%

Quarter-Over-Quarter

-0.7%

Year-Over-Year

Inventory

-2.1%

Quarter-Over-Quarter

-7.1%

Year-Over-Year

Source: Compass October 2024 Brooklyn Market Report

Rental Market Update

The big news today is the passage of the FARE Act by the City Council, with a veto-proof vote of 42-8. The bill is set to take effect 180 days after Mayor Adams signs it into law, though legal challenges may delay it further. Part of the ongoing debate about the bill, which says that whoever engages the services of a real estate agent or broker is responsible for paying the broker's fee, is whether or not it will negatively impact rents. We may not know how things will shake out until Q3 or Q4 2025.

For now, rents remain at all-time highs. Manhattan's average asking price (for studios through 3-bedroom units) is up 5% year-over-year ($5,596 in October 2024), despite a 21% increase in inventory across that same period. Given that Manhattan has been slowly cooling over the last several months, it's surprising to find that Brooklyn is now the rental market experiencing decreased rents. Brooklyn's average asking price for studios through 3-bedroom units is down 3% year-over-year in October 2024, to $4,119. When compared to the 71% year-over-year increase in inventory, however, it's not hard to determine why.

Read the Compass October 2024 Rental Report here.

In the News

New York City’s broker fee system, long a source of frustration for renters, is poised for significant change following the City Council’s approval on Wednesday of Proposed Int. No. 360-A, also known as the Fairness in Apartment Rentals Act (FARE Act). This legislation, sponsored by Council Member Chi Ossé and supported by 29 other council members along with the Public Advocate Mr. Williams and the Brooklyn and Queens Borough Presidents, aims to ensure that brokers hired exclusively by landlords are paid by the landlords themselves. 

The revised bill specifically prohibits listing brokers from passing their fees onto tenants when they exclusively represent the landlord’s interests​ (however, if tenants choose to work with their own brokers, they will remain responsible for paying those fees.). This includes brokers who publish listings with the landlord’s permission but without an exclusive listing agreement. Additionally, the amended version mandates that landlords or their agents disclose all fees tenants must pay upfront. Before signing a lease, tenants must receive an itemized list of all fees. Failure to comply with these requirements can result in civil penalties of up to $2,000.

Chi Ossé emphasized the need to end what he described as a "cruel and unfair system," highlighting the bill’s role in making housing more affordable. Ossé, the Council’s youngest member and only Gen Z representative, shared his personal struggles in finding an affordable apartment, which inspired him to champion this bill.

The real estate industry, led by the Real Estate Board of New York (REBNY), has strongly opposed the bill, arguing that landlords will simply increase rents to offset the cost of the brokerage fees they have to pay. This means that when tenants go to renew their leases for a second year, their rent increases are calculated from a higher base, which ultimately hurts renters more in the long run than paying an upfront brokerage fee.

Despite these objections, the bill passed with a 42-8 vote in the 51-member City Council, securing a veto-proof majority even if Mayor Eric Adams chooses to block it. Mayor Adams expressed concerns that the bill could lead to permanent rent increases and negatively impact small property owners, despite acknowledging its good intentions. He stated, “The bill has the right intention, but sometimes good intentions do not get the results you’re looking for.”

REBNY President James Whelan criticized the bill as prioritizing ideology over economic realities, asserting it would make housing less accessible. Brokers have voiced concerns that the bill would disrupt the housing market by making it harder for tenants to find listings and negotiate fees.

With New York’s rental vacancy rate near 1%, the lowest in over half a century, the debate over broker fees is especially critical. Data from StreetEasy indicates that in 2024, the average upfront cost for a rental with a broker fee was $12,951, including first month’s rent and a security deposit. This represents a 47.7% increase in upfront expenses compared to no-fee apartments. These high costs can deter renters from moving, even when necessary, further exacerbating housing challenges.

The FARE Act is not yet law and does not currently impact how rental broker fees are handled in NYC. It will take effect 180 days after becoming law, which will occur either when the mayor signs the legislation or automatically 29 days from Wednesday if the mayor takes no action. REBNY is preparing to take legal action to stop the implementation of the FARE Act, continuing its opposition despite the bill’s passage.

City Spotlight: Luna Luna

What do Jean-Michel Basquiat, Salvador Dalí, Sonia Delauna, Keith Haring and Roy Lichtenstein have in common? They all contributed works to an installation that was meant to tour the world, but was last scene in Hamburg in 1987... until it was discovered in storage in Texas and brought back to life in L.A. in 2023. What is it? According to one attendee, "The rides here are presented like they’re in a museum, though one with colorful lighting, whirling motors, jugglers, stilt walkers and musical compositions by Miles Davis and Philip Glass floating around."

You can experience this previously-forgotten art exhibit beginning November 20. Click here for more information.

Coming Soon

7 West 92nd Street, Unit 76

2 BD 1 BA 775 SF $899,000

This fully renovated two-bedroom home is ideally located just steps from Central Park. Bright and airy with three exposures and windows in every room, this home boasts charming details like exposed brick and a decorative fireplace, as well as the modern conveniences of an in-unit washer dryer and an open chef’s kitchen with high-end appliances.

For more information, please contact me.

Upper east side

Pre-War One-Bedroom

This charming prewar one-bedroom is quiet, with windows in every room and access to a range of building amenities, including a common courtyard, laundry facilities, bike storage, and a children’s playroom. Situated on 88th Street and Second Avenue, this residence offers convenient access to the 4/5/6 and Q trains, as well as the 86th Street crosstown bus.

Contact me for details.

NoMad

88 Lexington Avenue

2 BD 2.5 BA 1,541 SF $12,500/month

This luxurious east-facing split two-bedroom, two-and-a-half-bathroom home features oversized windows with open views, ceilings over 10 feet high, an in-unit washer/dryer, a separate office area, and central AC, all a building with more than 10,000 square feet of amenities.

Contact me for details.

In Contract

Upper East Side

1049 Park Avenue, Unit 6B

3 BD 2 BA 1,550 SF $1,250,000

This stunning 1,550 square foot home offers 9' 5" ceilings, original moldings, and tons of prewar charm, all in a prime Park Avenue location.

Upper West Side

150 West End Avenue, Unit 21H

1 BD 1 BA 900 SF $799,000

This spacious home is bright and offers stunning views of the building's garden. Set in an ideallocation on West 66th Street, this home is proximate to tons of dining options, transportation, and cultural institions.

Lenox Hill

400 East 70th Street #3003

2 BD 2 BA 1,150 SF $1,999,000

Perched on the 30th floor with breathtaking views from three different exposures, this expansive home has been fully renovated, and not a single detail has been overlooked. Enjoy 75 square feet of private outdoor space, an open chef’s kitchen with top-of-the-line appliances and a large island, and laundry just down the hall, all in a full-service condo.

Lenox Hill

174 East 74th Street, Unit 10G

2 BD 1 BA 850 SF $799,000

With approximately 850 square feet of living space, this inviting home boasts east-facing windows that bathe the interior in sunshine throughout the day, offers abundant closet space, the ability to install a washer/dryer, and an incredibly low-maintenance, all in a full-service coop ideally positioned west of Third Avenue.

Kips Bay

251 East 32nd Street, Unit 5J

1 BD 1 BA 775 SF $599,000

This recently renovated home is sunny, spacious, remarkably quiet, and boasts ample closet and storage space. Featuring wide-plank white oak floors and charming views of townhouse gardens through expansive windows, the apartment exudes a bright and cheerful atmosphere.

Just Sold

Upper East Side

440 East 79th Street, Unit 14G

1 BD 1 BA 750 SF $599,000

This well thought out apartment has been optimized with its thoughtful open kitchen and bar-stool countertop seating arrangement. The apartment begins with a pleasant entry foyer comprised of 3 closets in total including: coat, storage, and pantry (storage closet is a semi walk-in with organizers and shelving). The open kitchen features white cabinetry, sleek black quartz countertops, and full-size stainless steel appliances.

Just Listed

Astoria

21-21 31st Street,

Unit 5C

1 BD 1 BA 702 SF $3,900

Offered furnished or unfurnished.

This newly constructed southeast-facing one-bedroom features oversized windows that fill the home with natural light all day long. With high ceilings, an in-unit washer/dryer, and a private balcony, this residence offers modern comfort and style. Situated in the heart of Astoria, The Rowan is just steps from great restaurants and major transportation.

East Village

645 East 11th Street, Unit 1

Located in the East Village, this retail condo was formerly a dental office. There are three exam rooms and two street entrances.

Off-Market

Rental Buildings in Prime Locations

Four rental buildings available off-market, offered individually or as a package. Located on the Upper East Side, Upper West Side, and Gramercy, these properties feature a mix of rent-stabilized and free-market units, with all buildings fully occupied. Each building contains between 6 and 17 units. For more information, please contact me.

Lower East Side

265 East Houston Street, Unit 7

2 BD 2 BA 1,400 SF $9,995

Available short term (three months minimum) or long term, furnished, unfurnished, or partially furnished.

Ideally located in the heart of the Lower East Side, this expansive seventh-floor loft-style home offers unparalleled luxury living. Boasting exclusive elevator access and a private balcony, this residence features an array of modern amenities, including an in-unit washer/dryer.

Most Recent Mortgage Rates

Rates are from Citibank and are effective as of 11/14/2024. Rates are subject to change without notice.

Everyone’s mortgage needs are different. I have great relationships with mortgage brokers and loan officers from big banks and small banks who can help find the best loan for you. If you're looking for a lender you can trust, I'd love to help. Email me for more.

Rebecca's Resources

I'm an expert at successfully repositioning and selling homes that were previously listed without success. Click here for examples of how I have transformed listings to showcase a property's full potential, securing favorable deals where other agents could not.

Find out how Compass Concierge can help you prepare your home before coming to market by fronting the costs of upgrading, renovating, and staging at no interest.

I'm born and raised in New York City. If you've got a question, I've got you covered. For recommendations on anything, from the best ice skating rinks to ways to winterize your home, it's as simple as sending me an email.

Licensed Associate Real Estate Broker

M: 917.952.0414

rebecca.orbach@compass.com