The opening of the massive, multi-use Hudson Yards development in March was one of the biggest NYC real estate stories of 2019. (Getty Images)
It’s as true with real estate as it is with everything else in New York: There’s always something big happening. So before 2020 hits, let’s look back at the biggest NYC real estate stories of 2019.
1. L Train Shutdown? Never Mind!
For NYC real estate, early 2019 was about big things that looked certain to happen, then didn’t. Three days into the new year, Gov. Andrew Cuomo canceled the long-dreaded shutdown of the L subway line between North Brooklyn and Manhattan, opting to handle necessary repairs with a service “slowdown” instead. That immediately changed the housing landscape in Williamsburg, a neighborhood dense with new rental and condo buildings. Rents had been sinking in anticipation of a far worse commute during the shutdown — but they soon rebounded.
Yet StreetEasy Senior Economist Grant Long estimated that the pre-shutdown price drops saved North Brooklyn tenants at least $26.5 million before the plan changed. And in the second half of the year, apartment fever returned to Williamsburg, driving rents back up, and putting the trendy waterfront enclave at the top of our list of neighborhoods to watch in 2020.
Manhattan 1-2BRs Under $1M Article continues below
2. Amazon Coming to NYC … Or Not
A second real-estate curveball hit NYC a little over a month later, when Amazon abruptly canceled its plan to build a huge second headquarters in Long Island City, Queens. The much-hyped announcement had sent prospective buyers into a tizzy, spiking home prices in LIC (and user searches on StreetEasy). And of course, its sudden cancelation prompted a good bit of chin-scratching and crystal-ball-gazing in the media. But even without Amazon’s new HQ2, the StreetEasy Price Index continued its year-over-year rise in Northwest Queens, and Amazon still added new jobs in NYC, though so far considerably fewer than the 25,000 it had promised. Will LIC still become the tech hub for which some see potential? That remains to be seen.
3. Hello, Hudson Yards!
Hudson Yards was a big deal that mostly turned out as expected. The $25 billion mixed-use real estate project, one of the largest in U.S. history, opened in March, with phase two yet to come. The covered rail yard now holds condos and rentals (which StreetEasy shoppers found quite interesting), plus office space, retail, and of course, that shiny, upside-down Christmas tree you can walk up, otherwise known as the Vessel.
Big-name companies like Facebook and Wells Fargo booked the office space, while the Hudson Yards shopping mall opened places for their employees to spend bonus checks on luxury watches and handbags. Equinox built a hotel. The food at Mercado Little Spain got great reviews. Whole Foods is on its way, of course. So with Hudson Yards, the gilding of Manhattan’s far west side took a great leap forward.
Brooklyn 1-3BRs Under $1M Article continues below
4. Slow Sales and the Great Condo Hangover
Speaking of new condos, a quick trip through parts of Manhattan, Brooklyn, and Queens will show that there’s quite a lot of them in NYC. And new research from StreetEasy this year found that many units constructed in the recent building rush have not sold — ever. Of 16,242 condo units to arrive on the market since the start of 2013, more than 25% haven’t found buyers, forming what StreetEasy’s Grant Long calls a “condo hangover.” And it’s only gotten worse as the larger NYC sales market has slowed over the past 24 months.
Pricey condo purchases did hit a record around June, just before a hike in the mansion tax. But the $1.1 million median price of the city’s new-development units is well above what most NYC buyers can afford. Those who are buying are often investors, many of whom plan to rent out the homes in the hope that they appreciate over time.
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Meanwhile, the lack of buyers has not meant a lack of new construction, as thousands of new condo units are still going skyward. All of which is why Long expects 2020 to a year of condo clearance sales, with recorded sale prices on new units running perhaps 15 to 20% below ask.
5. New Law Changes the Rental Landscape
All through 2019, the NYC rental market soared, as many city residents resisted the high prices in the sales market and availed themselves of the city’s large and varied rental selection. In June, New York lawmakers approved a historic package of laws designed to protect tenants. The law limited application fees to $20; set security deposits to a maximum of one month’s rent; and required their return within 14 days of the tenant moving out. It also increased penalties for wrongful evictions and put in place a host of new rules governing the city’s 1 million rent-regulated apartments, with the aim of keeping more tenants in place.
Critics said the law would reduce the incentives for property owners to maintain their buildings. Meanwhile, tenants and brokers struggled to sort out what the new laws actually meant, and some tried to find ways around them. (Here’s a StreetEasy guide to the rent laws and the official city guide, if you’re wondering how they apply to you.) It’s a complicated law, but the underlying message was unmissable: 2019 saw a shift in the balance of power between landlords and tenants in NYC.
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