A question posed to me by several clients regarding the impact inflation may have on NYC real estate was recently addressed in a
Forbes article. As I mentioned in
last week’s email, demand has remained high all summer long and we don’t necessarily see things slowing down anytime soon. Yet in that same vein, the latest Consumer Price Index is reporting a 5.4% acceleration in consumer prices over the last 12 months, so naturally this is a valid concern among buyers and sellers alike.
Although price creep hasn’t been significant, we’ve still been seeing a gradual increase since the start of the year. Buyers are frustrated for missing out on deals that are now out of their budget because they waited too long. Sellers are cashing out at or above asking price and bidding wars are still imminent. And now with
foreign buyers back in the fold, we can expect international interest to boost market activity, driving prices up even further.
However when comparing the market to where it was a couple years ago, it isn’t as bad as one might think. Yes, the deep discounts we initially saw are now in the history books; but there are still good deals out there and sellers are keenly aware that they need to list at a fair market price and could very well find themselves negotiating or reducing prices, given the expected increase in inventory later this month.
If you’re serious about buying, it would be in your best interest to buckle down now, given the market trend we’ve been seeing all year long. In terms of inflation, people should pay attention to their spending habits and work at reducing their debt, as wisely pointed out in the Forbes article. The bottom line though is that inflation shouldn’t impact the NYC housing market, which continues to remain robust with no sign of slowing down.
If you would like to talk through this further, I’m happy to get on call. I understand that there is a lot to digest with the current market dynamics, so please don’t hesitate to reach out. Seeking advice doesn’t cost you anything.
