Adrienne Albert, CEO at the Marketing Directors
Rentals will stabilize if not continue to climb in value. New rentals are averaging over $80 per square foot and we believe that figure will be eclipsed in 2012. Because there are only six months of standing inventory in for-sale product, condominium prices will substantially escalate. Our for-sale market will continue to be fueled by the local New Yorker and supplemented by the foreign buyer throughout 2012. End loans will be more attainable also, helping to fuel the demand side of the market. We believe the average per square foot in Manhattan will exceed $1,800 [for new condos] in 2012.
Andrew Heiberger, founder and CEO at Town
On the Manhattan sales front, I believe that prices and price-per-foot in all parts of Tribeca, the far West Village, Noho and west of Park Avenue on the Upper East Side will rise the most due to a lack of supply. The same is true for townhouses and other single-family residences, where quality supply is also limited. Overall, I believe 2012 will see more sales transactions and slightly higher prices in Manhattan, with the market buoyed in part by interest rates remaining at historic lows during this upcoming election year. [In terms of the] new development sales market, I believe Gary Barnett’s One57 will be a grand slam and the success story of 2012. On the Manhattan rental front, the vacancy rate will remain low and rents are sure to rise starting around the second quarter. If I were renewing a lease right now I would try to extend for two years if given the choice, because once employment numbers pick up, rents will jump even further to record highs.
Barbara Corcoran, founder of the Corcoran Group
This will be the year buyers get tired of waiting. And that alone will turn this whole market around. Get ready to rock and roll!
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Donald Trump, president of the Trump Organization
Residential real estate will remain similar with a slight uptick, but the really good real estate will have excess value.
Mitchell Rutter, president of Essex Capital Partners
In 2012 we are very optimistic about the continued growth of the rental market in Brooklyn and Queens, not withstanding anticipated layoffs in the finance and banking sectors. In Manhattan, the price-per-foot being paid for new rental projects leads us to question whether the projected rents necessary to justify these projects can be met in the short term. But over the long term, beyond 2012, the growing rarity of development sites means these projects too will be sustained.
Elizabeth Stribling, president of Stribling & Associates
I am cautiously optimistic because demand is high, financing is easier and mortgage rates are low. High [rental prices may] prompt more people to buy, and foreigners [will] continue to favor the safe haven of the U.S. and the prime location of New York City.
Stuart Saft, chairman of Dewey & LeBoeuf’s global real estate department
Rents will continue to rise at a rate significantly greater than [the consumer price index], resulting in co-op and condo prices increasing by at least 10 percent. Interest rates on residential real estate, including multifamily, will continue at the present historically low rates through the end of the 2012 (i.e., after the presidential election) but will begin to rise after 2012, and the availability of mortgage financing will increase due to comfort with the New York City market for housing. Finally, the euro will continue to be in trouble, causing a flight to safety to the U.S. and particularly New York City, so New York City properties will trade at even lower cap rates.
Compiled by Lauren Elkies/ Real Deal