Industry Signs Point to a Competitive Residential Market in 2024

Industry Signs Point to a Competitive Residential Market in 2024

By Kristen Fortino

The wintry conditions here in the Northeast pretty well capture what’s happening in the Greater New York residential real estate market, which has fallen into a state of hibernation. Housing inventory is low, but that’s typical for this time of year. Unlike in 2023—which was a tough one for real estate—my team at OnePoint Real Estate Group is seeing some promising signs for buyers, sellers, and investors in the near term.

Lower Interest Rates (Eventually)

Naturally, one of the biggest questions for the year ahead concerns interest rates. The Federal Reserve Board seems primed to adjust interest rates, and they’ll likely start cutting them a bit. We don’t know by how much, but we do expect rates to decrease—though not all at once. Instead, we expect to see a gradual decrease over the course of the year.

As a result, we predict that people who have been sitting on the sidelines—both buyers and sellers—will be ready to act in the spring, around April. That’s when inventory typically hits the market, and we should start seeing the first rate decreases around that time.

New York Area Real Estate Trends

One of the challenges for real estate last year was lack of inventory. People simply weren’t selling. Between high interest rates and concerns about the economy, a lot of property owners in Manhattan decided to either take advantage of high rents and bring in tenants or to simply hold on to their property.

We’ve already started talking with prospective buyers, who generally fall into one of two categories: investors who want to purchase small multi-family buildings as owner-occupied rentals and young professionals who are expanding out of studio apartments into one- or two-bedroom units. OnePoint provides consulting expertise to clients who are looking to buy, sell, or invest, and we connect these individuals with vetted agents in our extensive network who can help them achieve their goals.

As temperatures climb and interest rates begin to drop, the real estate market should start to heat up. If the rates go down as anticipated, we’ll likely see some bidding wars and more inventory coming on the market.

We also expect to see plenty of buyer competition on the investor side. Even if an active market entices owners to sell some of their assets, more favorable rates will mean increased competition among savvy investors. Here at OnePoint Real Estate, we keep our pulse on the multi-family market, particularly in New Jersey and Pennsylvania, for our clients and as active investors. Thanks to our partnership with Metropolis Group and other industry connections, we can identify target properties with the greatest ROI potential to expand real estate portfolios.

Specifically, we look beyond cosmetic updates for value-add opportunities that yield long-term, strategic appreciation.

If you’d like to discuss your real estate goals for the year ahead, contact OnePoint Real Estate Group.