By: MELISSA PUPPO
Real estate pros weigh in on how New York and California are navigating the changing real estate markets.
The country’s real estate markets have encountered their fair share of challenges in recent years that led to a series of disruptions affecting everything from buyer preferences to
imbalances in supply and demand. Now the U.S. housing markets are battling shifting trends, high mortgage rates, and more, setting the stage for an intriguing landscape. Amid all the uncertainty, real estate experts are optimistic about the future across the coasts, particularly in two of the U.S.’ hottest markets: New York and California.
Steven James, President & CEO of Berkshire Hathaway Home Services New York Properties, believes the real estate market will continue to improve in the coming years as the world returns to a sense of post-pandemic normalcy, particularly in New York City. “It will take time, but we’ll get there,” says James, highlighting the return of foreign buyers to market.
While many regions across the country face softer prices, less inventory, and a smaller pool of buyers, the Northeast is an outlier, especially New York City. Sixty percent of New Yorkers rent, and 40 percent are homeowners, ensuring a consistent supply of buyers despite the economic climate.
With interest rates on everyone’s minds, you might wonder if purchasing a home right now is the smartest move. Martha Mosier believes the answer is yes. The president of Berkshire Hathaway HomeServices California Properties describes the market as “scorching,” anticipating how once mortgage rates drop to 5.5 percent, there will be an increase in the number of participating homeowners. “As rates drop, demand will increase from where it is today,” she says. “More buyers will enter the housing arena as affordability improves.”
Southern California is already experiencing a bustling market, with multiple offers, home prices above their asking prices, and the return of appreciation. “An even hotter market would mean that home values would appreciate at a stronger pace,” she says. Preferences are also shaping where people buy properties. Mosier points out that coastal San Diego and Ventura have emerged as new hot spots for luxury, offering great value for those seeking their dollars to stretch further than in Orange County, which was traditionally considered the go-to luxury location.
For those with their eyes on New York City, it’s also an ideal time for buyers to purchase as prices are slightly more reasonable than in the past. “Cash buyers are at a great advantage as that buyer can negotiate a much better price than a buyer subject to financing,” says James.
While it’s easy to get discouraged in today’s fast-paced market where many buyers are writing offer after offer with no success, Mosier says to continue the pursuit of a home regardless of current market frustrations. She adds, “of course, leverage the expertise of one of our Berkshire Hathaway HomeServices professionals.”
For sellers, James says pricing is key. “If it’s not within the right range, it doesn’t get bids, and it certainly doesn’t get sold,” he says. Lingering on the market for an extended period can deter buyers from pursuing a sale.
One thing to remember: Finding the perfect moment to buy or sell can lead to disappointment, as there is no such thing as the “perfect time.” Mosier stresses the potential loss that fence-sitters face when they miss out on years of substantial appreciation. Instead, she advises families ready to purchase to create a family budget and consult with a mortgage professional to find their ideal home.
