Usually, the ideal time to be on the New York City market is to launch sometime in March or April, but we are seeing a different trend, at least in terms of new developments. Despite a slowdown in April due to various factors such as holidays, spring breaks, and the First Republic bank failure, New York City’s new development got a fresh wind in May.
Surprisingly, higher interest rates have boosted demand for new developments, as potential sellers in the resale market are hesitant to list and lose their lower rates. Developers have no such issue. Furthermore, the backlog of new buildings caused by pandemic-related lockdowns and labor and material shortages is finally being addressed, resulting in new projects entering the market.
The result is developers are gaining confidence in launching projects in prime areas of Brooklyn, the Upper West Side, and Upper Manhattan after the peak of the spring market. Contract signings for new developments in the first five months of the year increased by 26% compared to the same period between 2015 and 2019. While the increase in supply may not cool prices significantly, the overall lack of inventory is a promising sign for the fall market.
