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ew York City's real estate landscape is a tale of two markets: one thriving, the other struggling. Amidst economic headwinds and shifting federal policies, Manhattan and Brooklyn's residential market has proven surprisingly resilient. Luxury properties, particularly those above $4 million, have seen steady contract activity, with an average of 30 deals per week.
The condominium sector is driving this trend, as buyers seek move-in-ready homes amidst rising renovation costs. Neighborhood preferences remain a defining feature of New York real estate, with small, modern condos thriving in areas like the Lower East Side and spacious three-bedroom apartments commanding stronger demand in Tribeca and the Upper West Side.
However, Harlem's once-thriving market for young buyers and historic brownstone enthusiasts has experienced sales declines for two consecutive years. Contract activity in Harlem dropped significantly from its peak in 2021, falling by nearly 40% as of February 2025.
Tight inventory remains a challenge, especially for turnkey properties. Older condominiums and co-ops that require renovations still present value opportunities, but the increasing cost and complexity of remodeling have deterred many potential buyers. Renovation costs have surged, with mid-range projects now exceeding $700 per square foot, making well-maintained homes command premium prices.
The rental market's influence on buyer behavior is undeniable. With high rental prices and units disappearing quickly, many renters are opting to purchase properties instead. However, competitive bidding wars remain more common in the rental sector than in home sales, where price stabilization has been the prevailing trend. Median rental prices have reached record highs, with Manhattan's median rent exceeding $4,500 per month.
Despite national economic uncertainty, New York City's real estate market appears to be maintaining a stable trajectory. Experts suggest that careful buyers can still invest in homes that will retain their value over time, making this a prime opportunity for those willing to navigate the current climate.
