Insider’s Guide: Jonathan Miller on the outlook for New York’s luxury property market
Jonathan Miller, the President and CEO of Miller Samuel Inc. and compiler of Douglas Elliman’s keenly followed market reports since 1993 gives us his perspective on the outlook for the market
2 minutes to read
What effect will lower interest rates have on New York’s luxury residential market?
After the Fed pivot in December, which conveyed that they will be cutting rates by 75 basis points sometime in 2024, there was an uptick in new signed contracts of residential sales by more than 14% year-on-year.
How will the market perform in the run up to the US presidential election in November?
In our research going back to 1990, a federal election year sees no impact to price trends, but it does slow sales more than usual from the July 4th holiday through to the November election, but quickly overcompensates over the following several months. There is no apparent impact from the party or candidate that wins.
How much do you expect rents to decline in 2024?
I reckon between 5% and 7%.
If you had to pick one New York neighbourhood that will outperform in the next 1-2 years, which one will it be and why?
Lenox Hill: Located in the northern end of the Upper East Side, known for large family-sized apartments and some of the best private schools in the city, the neighbourhood saw some of the largest price gains and has the potential for more growth in 2024.
Has the strong dollar led to weaker overseas’ demand for New York’s luxury homes?
The strong dollar has essentially removed investors’ “currency play” for the past five years. What impact do you think AI will have on the luxury residential sector?
On the margin, it will enable a very small segment of the market to acquire more super luxury properties, similar to the trends we saw during the crypto bubble.
If you had to choose one risk and one opportunity for New York real estate, what would they be?
The commercial office market remains a significant risk due to the ‘workfrom-home’ phenomenon but that is unlikely to have a significant adverse impact on the overall economy. New development product, given the lack of inventory, has more potential upside than it had over the past decade.
What one tip would you give an overseas purchaser considering acquiring a foothold in the New York market?
Look at the market from a long-term perspective. New York has a rich and powerful history of resilience during times of economic uncertainty.
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