As the epicenter of COVID-19, New York City’s real estate landscape has experienced significant changes over the past few months as the result of growing concerns around the economy and global health crisis.

Home sales slowed in the city during the first half of the year. However, as the state continues to reopen, transactions seem to be picking up again. Read on to learn about the current state of New York City’s real estate market and what implications it may have on the buying experience:

In-Person Showings

As NYC enters phase 2 of reopening, buyers are now able to view properties in-person, providing greater opportunities for sellers to capitalize on pent-up demand. Even so, real estate agents are still urged to offer virtual tours, encourage the use of face masks, and schedule showings only by appointment.

For the time being, you should anticipate a nontraditional buying experience. Home tours may be limited to one prospective buyer at a time, and at least some aspects of the homebuying process will be conducted virtually to abide by the city’s social distancing requirements.

Record-Low Interest Rates

In efforts to stimulate the economy, the Federal Reserve dropped interest rates to a record low. This has bolstered both mortgage refinancing and buying activity as homeowners and prospective buyers seek ways to take advantage of more favorable borrowing terms.

Low rates might incentivize you to apply for a mortgage or buy as opposed to rent. If you’re looking to buy in the city, you could borrow against your current home through a low-interest equity loan, which would provide a source of cash to put toward a new house.

Home Prices

Despite experiencing an initial dip, reports show that home sales have remained relatively constant throughout the pandemic. This may be an indicator that prices could continue to stay stable or even increase once the competition returns to normal.

As home prices remain consistent, you should prepare for tighter competition and bidding wars. You’ll want to put down an attractive offer from the get-go, which may require you to apply for mortgage preapproval or front a higher down payment.

Recovery Timeline

While the real estate market is poised to recover to a semblance of normalcy, specific price points will likely experience faster regrowth than others. According to 6sqft, the luxury market may be slower to recover since many of these buyers left the city at the start of quarantine. However, the city’s allure will still attract investors to invest in residential development, bolstering growth across all price points.

Regardless of price point, you should expect buying activity to improve with time. While families and wealthier buyers may be slower to return to the city, blue and junior-white collar workers still need housing close to their offices as business continues to open. In addition, millennial buyers ready to pursue urban living may help fuel the sub-$2 million market.

Buyer Preferences

With many employees now working from home, buyers are beginning to seek properties with more amenities, outdoor spaces, and home offices. Some people, especially those with children, have even moved further out from the city center and flocked to the surrounding suburbs where it’s less crowded and where there’s more room to social distance.

If you’ve spent the past few months raising your children and/or working from home, you may have different priorities than you did when quarantine began. If you anticipate your current schedule staying the same for the foreseeable future, you might want to consider a home with more space and convenience, even if that means moving farther away from the city.

The city’s recovery will depend greatly on whether a second wave of the virus emerges and when schools will reopen. The state may also decide to raise taxes to make up for economic shortfalls during the pandemic, which could have an impact on the market. In the short-term, however, real estate activity is expected to continue gaining momentum.

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