New York Condos for Christmas

The streets of Manhattan, New York are packed with European tourists and foreign travelers shopping for gifts and valuables of all kinds.  The dollar is the weaker currency so foreign consumers are buying up products right and left and getting amazing deals.  Holiday gifts are not all they are buying.  New York condos are at the top of their wish lists as well!

While the rest of us are worried about market conditions, year end bonuses, and interest rates, foreign investors are keeping New York real estate agents busy and are buying up mid level to high end luxury condos. 

For what has been a very slow month for real estate, even in New York which has been the strongest housing and condo market in the country, agents are now increasingly busy and waking up early to talk to European buyers oversees.  Everyone is taking advantage of the exchange rate and purchasing multi-million dollar New York condos for investment purchases. 

In the last two years, the number of foreign condo buyers has doubled and they have purchased up to one third of the inventory during that time.  In other words, while other markets in the country have suffered, foreign investors are keeping the New York real estate market alive and well.  With all the new development continuing to permeate the market, the absorption rates would be way down if it were not for our friends from overseas.

Foreign buyers have been keeping the condo market afloat in Manhattan and love the amenities and flexibility in buying.  Co-ops are not a great investment for foreign buyers as it would be difficult to even qualify.  Rules for renting the unit are much more strict in co-ops as well.  Many of these buyers use this as an investment vehicle so renting flexibility is key.

During 2007, foreign buyers have made up 20% of sales for major real estate sales and marketing firms whereas a few years ago there were none.  This is mainly because all the new inventory is new condos rather than co-op apartments that don’t allow foreign buyers/investors.  This phenomenon is not expected to slow down and real estate agents are happy about that!

These foreign buyers are not necessarily sophisticate investors, but at the moment they really don’t have to be.  They plan to keep these assets for a long time and generally make their purchase decisions very quickly. 

As far as New York agents are concerned…they say, “keep them coming!!”