NYC home prices rise 10% in early 2025
66 comments
·April 30, 2025janalsncm
This is YoY Q1 for NYC. I’d be curious whether this holds for the first half of the year. Likely no. Bay Area prices are also expected to fall due to market volatility.
I think the reason for this is pretty intuitive: more expensive (NYC/Bay Area) homes are purchased by high income people. And higher incomes are more affected by the stock market because high comps are composed of higher % stock. Someone making 200k might have 20% stock. Someone making 600k might have 50% stock. So a 10% drop in stock market costs the first person 2% of their comp and the second person 5% of their comp.
hx8
1. Stock is mostly a tech thing, which is a smaller percentage of NYC home buyers.
2. Real estate is a safe haven asset to put capital into. In uncertain markets some buyers will choose real estate over stock or other more risky investments. NYC real estate is a highly valued asset globally.
3. Real estate prices in prime global locations (London, Dubai, NYC) are determined more by global liquidity than by local wages.
4. Recessions often impact real estate prices less than stock prices. 2007 was an outlier because of how many defaults occurred in real estate. In general the mortgages today are much stronger than before.
5. If mortgage rates decrease then that would have upwards pressure on housing valuations.
EDIT: Prices might come down, but I wouldn't expect fantastic bargains in NYC.
master_crab
I live and own in NYC. Stock is very much also a part of comp in finance as well (I’m not in it, but my wife is).
I think you are spot on that prices will come down slightly (bonus pools will drop and that matters) but NYC real estate is rarely a bargain (or at least hasn’t been since 1998).
ardit33
2009 - 2013 there were some good bargains in LIC and other areas. It will take a major recession to see some prices come down again to some reasonable level.
Also, I wonder what the volume of transactions is. Because I see little inventory (I was looking into Brooklyn), and perhaps only new construction is selling, which means it skews prices higher (new construction is always more expensive).
koolba
This is not surprising at all. Gold is up 23% year to date priced in dollars. The euro is up about 10% year to date.
A commensurate rise in real estate prices for arguably the most international city in the USA seems logical.
HPsquared
It's like how UK stock prices are inversely correlated with shifts in GBP.
JCM9
NYC area real estate certainly isn’t cheap, but compared to the insanity on the west coast there’s a lot to like. NYC has really bounced back after COVID and is a real hub of activity again. Folks want to be a part of that.
Also the second home market for NYC is strong. Having a place in the city is a status symbol for many. Nobody cares if you have an apartment in the Bay Area or other cities with expensive property but lots of folks want a “small place” to spend weekends in NYC.
That all also keeps prices rising. Not saying it’s good, but betting against NYC real estate is not advisable.
affinepplan
unsustainable. and should be unconscionable. almost every pressing social problem can be traced back to the lack of housing supply (of course, some traces are looser than others)
jimbokun
NYC housing price increases have been unsustainable for several decades now.
readthenotes1
If we are going for a reductivism, I'm going to take it all the way to pride, greed, and envy for the housing supply problem.
(I could throw in lust, but that's last century's problem since various forms of birth control have negated its influence on housing demand)
digbybk
Changing human pride, greed and envy is hard. We know how to build housing. Or we used to.
tshaddox
> I'm going to take it all the way to pride, greed, and envy for the housing supply problem.
Eh, I mean greed in other economic environments would cause people to build ever taller condos and apartment buildings to get more and more revenue.
redwood
Surely it's not so simple when New York City is building more housing supply that essentially any other American city (and has the best public transit system in the nation)
fvrghl
Source? NYC chronically under builds. It's ranked #35 in new housing construction: https://constructioncoverage.com/research/cities-investing-m...
filoleg
That link you shared is counting the number of units build per 1k existing units.
Given how dense and populated NYC is (aka how many existing units there are), this metric isn't as meaningful. I believe the grandparent comment was talking about the raw number of units.
Actually, go to the bottom of the page you shared and look at the section titled "Full results", then sort by "Total new housing units authorized". Sadly, you will need to do some quick manual work to parse the results, because it sorts numbers as strings rather than as actual numbers. But you can clearly see from there that NYC is #1 in terms of raw numbers of new housing units. And that's data from 2021, and afaik NYC only increased those numbers significantly in the past 4 years.
ChrisLTD
You'd think NYC would reach a point where the market wouldn't bear any more price increases, but we're not there yet.
bobthepanda
NYC is unlike most housing markets in that for a lot of people, an international pied-a-terre in NYC is a sign of luxury and wealth, whereas no one really gives a crap if you have a second home in Seattle or Chicago or Boston.
In the US the only other markets that operate like that are probably LA, Miami, maybe Honolulu.
esseph
"is a sign of luxury and wealth"
I wish they'd just go to therapy instead
psunavy03
. . . or they're rich enough to buy it, but they legitimately enjoy having it?
mmooss
For a lot of people, many more I would guess, there is no substitute for access to the city, culture, highly skilled dynamic people and organizations, etc.
bombcar
LA is a huge sprawling pile of homes of various prices. Portions of LA have some cachet but a "second home" in LA could be this wonderful box:
https://www.zillow.com/homedetails/10955-S-Spring-St-Los-Ang...
bobthepanda
Nearly all metropolitan housing markets have bad areas; you can find a home for <200k in the South Bronx in NYC, for example.
quickthrowman
That’s not even really a listing for a house, if I was interested in purchasing it I would take the land value and subtract the cost to demolish the building to get a fair value.
brailsafe
Some bits of Colorado maybe?
bobthepanda
ski towns and places like Jackson Hole or Bozeman are unique in their own right but my understanding is that the demand there is mostly domestic-driven, amplified by a by-definition small housing market size.
this doesn't affect big cities near nature nearly as much, like SLC or Denver.
euroderf
Does New Jersey get no love ?
bobthepanda
Well no, because the entire point of using an NY address for clout is that it's in NY. NJ is definitively not NY for that purpose.
ramesh31
>You'd think NYC would reach a point where the market wouldn't bear any more price increases, but we're not there yet.
You'd be thinking this since 1873
FredPret
According to the Credit Suisse Global Wealth Report, the USA alone has ~26m millionaires, and ~85m in the whole world.
A lot of them want to live in NYC, and many times more than that want to visit.
subpixel
I thought that 20 years ago.
null
tehlike
and may never be.
flerchin
I see home prices in Dallas are down by about 10% from peak.
symlinkk
Austin is down 20%. Doesn’t make sense to me. I keep hearing “they overbuilt” - so what, none of the builders saw this coming either?
lotsofpulp
> so what, none of the builders saw this coming either?
This falls under the trivial fact that no one can see the future.
margorczynski
The question is whenever it is more than inflation or less, averaged out since the last few years.
Of course the other major effect seen worldwide is that people naturally concentrate in bigger cities and the countryside is dying out.
glaucon
Going back to December it was widely believe that Trump's administration would usher in a bonanza of merge and acquisition activity, an area that has run quite cool during Biden's term. For many people M&A activity is also spelt b-o-n-u-s-e-s so I guess some of this is people spending a bonus they don't yet have and, as things have turned out, won't be getting, at least in the foreseeable.
ramesh31
Mark my words, the lower Hudson valley is the number one place on earth I would be buying real estate right now if possible. Best public transit in the entire country; you can be at Grand Central in an hour flat, trains run every 30 minutes all day. And homes are still attainable by normal human beings (~$500k gets you something nice in a decent area). Completely slept on region atm.
Loughla
500k for a house makes me realize how low my pay is in a rural area compared to metropolitan areas and how low property is here comparatively as well.
mupuff1234
I wonder how NYC would look like if it were managed by Singapore.
nxm
Fining people for spitting in public would not fly with social justice warriors in NYC.
2OEH8eoCRo0
Fining? Don't they publicly cane?
It seems to work! It's one of the cleanest places I've ever been to.
glaucon
Strange how pervasive this idea is.
Corporal punishment in Singpaore is not delivered in public, certain classes of offender are exempt, and those offenses it is imposed for are completely unrelated to public levels of cleanliness.
From Wikipedia [1] ...
Singaporean law allows caning to be ordered for over 35 offences, including hostage-taking/kidnapping, robbery, gang robbery with murder, rioting, causing grievous hurt, drug abuse, vandalism, extortion, voyeurism, sexual abuse, molestation (outrage of modesty),[16] and unlawful possession of weapons. Caning is also a mandatory punishment for certain offences such as rape, drug trafficking, illegal moneylending,[17] and for foreigners who overstay by more than 90 days – a measure designed to deter illegal immigrants
Real estate is local. Hard to conclude much from a single (desirable) area.
Scroll down to the two tables at the bottom in this link to compare metro areas:
https://www.realtor.com/research/march-2025-data/
Sure, NYC metro is up 10%, but the median price ($780k) is still far from LA/Orange County (an eye-watering $1.2 M median) and San Jose/Sunnyvale at $1.4 M.
Cleveland and Buffalo are at ~$250k median though...and they are technically "coastal" cities :)