Summer Recap and Four Predictions for Fall
August 28, 2025
Hello,
This summer, New York real estate showed two clear narratives: strength at the top and strain in the middle. Here's my breakdown of the past couple of months:
1. Luxury Leads
Cash was king—69% of Q2 sales closed without financing, with that share jumping to over 80% for properties above $5M. Trophy assets continue to attract global wealth, proving that New York's ultra-luxury tier remains a safe haven.
2. Mid-Market Lags
The $1M–$3M range tells a different story. Elevated rates have made financing costly, cooling activity, and widening the gap between high-end momentum and middle-market hesitation.
3. Rents Surge
In the rental market, prices continue to surge due to new legislation and tight inventory. In our recent podcast, we looked at New Rochelle as a great case study for resolving similar challenges with logical, long-term planning. Can NYC get there?
4. Commercial Pulse
Leasing is rebounding, with 3.01M SF leased in July—11% above the 10-year average. Numerous conversions to residential use and "back to office" mandates are tightening availability to its lowest point since early 2021.
Predictions:
As we head into the fall, we're keeping a close eye on how these trends will shape the market. Here's what we're predicting for the season ahead:
Luxury: Demand will stay firm, but buyers may grow more selective as trophy inventory thins.
Mid-Market: For this rate-sensitive market, expect more price cuts and negotiability as affordability challenges persist.
Rentals: Prices should stabilize, but don't expect meaningful relief until new supply enters the market.
Commercial: Leasing momentum will continue. More conversions will chip away at vacancy, subtly reshaping Midtown and FiDi.
We're looking forward to a full city this fall— The Armory Show and NY fashion week are just around the corner—as Manhattan completes a beautiful rebound.
Wishing you a restful Labor Day weekend.
Ariel and the Team
