The New York Real in 2020 will remain fairly flat, with a few highlights. Though the New York City area will continue to grow, prices are forecast to increase only 2.6% through February, a much lower number than in previous years. This puts New York City in the bottom 25% of growth for the major real estate markets in the country.
In looking at the numbers more closely, sales of standalone homes will fare better in the year ahead than condos or townhomes. The latter category is forecast to appreciate only 1.5%, and in Manhattan in particular prices are expected to actually drop between 1-2%. With the current median prices of a Manhattan home sitting at $671,400, according to Zillow, this may be an opportunity for buyers who have been waiting for a dip.
Not all boroughs will be affected equally by the soft market. Prices in Staten Island, which is the least expensive of the five boroughs, and also has a large inventory of single family homes, should appreciate a healthy 5.6%. Queens real estate is also expected to appreciate in price by 3.1%. Across the river in New Jersey, prices are overall similarly flat, with single family homes overall forecast to perform better than condos. One exception is in nearby Essex, where condos priced in the lowest 25% of the market should increase by 5%, though more expensive properties won’t reflect that stronger growth.
In New York State as a whole, the outlook is a little bit brighter. The median sales price of a property in the state increased 7.1 year to year, and is expected to keep growing into 2020. Zillow has the current median sales price in New York State at $304,500, with an expected 4.4% increase going into next year. Unfortunately, with higher prices comes lower affordability, as salaries are not keeping up. The housing affordability index, calculated by the National Association of Realtors and meant to measure whether an average family can qualify for a loan, dropped in 2019 down to 121. New York inventory is tightening, another indication of a seller’s market, but slowly. 2019 had a 2.6% drop in inventory, and 2018 2.4%, a smaller decrease than in previous years.
For those looking to invest, there is still quite a bit of room to do so in the New York market. According to Mashvisor, the best cities in New York for someone looking to buy an investment property in 2020 may be Windham, Greene County or Hunter, Greene County. Outside of investment, for first time homebuyers looking to get their foot in the door, 2020 may be their chance in the New York City area, where flat prices could mean a good deal for a buyer.