Which homes are selling fast - and which are sitting on the market?
New York City’s real estate market experienced a steady recovery in the first quarter of 2025, with demand for high-end condominiums driving sales despite broader economic uncertainty, according to Coldwell Banker Warburg’s latest market report.
The report highlights that while economic headwinds - including shifting federal policies and volatile stock markets - have affected various industries, the residential real estate market in Manhattan and Brooklyn has remained resilient. Luxury properties, particularly those priced above $4 million, have continued to see steady contract activity, averaging about 30 deals per week. The majority of these transactions have been in the condominium sector, a trend driven by buyers seeking move-in-ready homes amid rising renovation costs.
Buyer preferences
Market segmentation remains a defining feature of New York real estate. Neighborhood preferences continue to influence sales, with small, modern condominiums thriving in areas like the Lower East Side, while spacious three-bedroom apartments see stronger demand in Tribeca and the Upper West Side. Meanwhile, Harlem - a once-thriving market for young buyers and historic brownstone enthusiasts - has experienced sales declines for the second consecutive year. Contract activity in Harlem dropped significantly from its peak in 2021, falling by nearly 40% as of February 2025.
Tight inventory remains a challenge for buyers, especially for properties in turnkey condition. Older condominiums and co-ops that require renovations still present value opportunities, but the increasing cost and complexity of remodeling have deterred many potential buyers. Renovation costs have surged, with mid-range projects that once cost $250 to $300 per square foot now exceeding $700 per square foot, according to the report. This divide has led to a market where well-maintained, move-in-ready homes command premium prices, sometimes rivaling figures from a decade ago, while properties in need of significant work linger on the market.
Rental market influencing buyers
The rental market continues to exert significant influence on buyer behavior. With rental prices remaining high and units often disappearing within 24 to 48 hours of listing, many renters are opting to purchase properties instead. However, competitive bidding wars remain more common in the rental sector than in home sales, where price stabilization has been the prevailing trend. Median rental prices in key neighborhoods have reached record highs, with Manhattan’s median rent exceeding $4,500 per month.
Overall market condition
Despite uncertainty stemming from national economic policies, the New York real estate market appears to be maintaining a stable trajectory. While large year-over-year gains seem unlikely in the near future, experts suggest that the current climate presents opportunities for careful buyers to invest in homes that will retain their value over time.
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