We caught up with Julia Hoagland, real estate broker in NYC, to discuss the emerging trends in the market.
What are some of the neighborhoods you’ve noticed experiencing more buyer demand and what do you think are the forces creating that?
Julia Hoagland: The West Village remains an area with high demand particularly in the pied-a-terre friendly sector of this market. This is one of the most sought after neighborhoods in all of NYC and as a result remains somewhat insulated from overall market shifts. Portions of Harlem and Brooklyn remain very ‘hot’ as well due to opportunity provided by lower cost and resulting higher yield.
What are key trends happening now that you expect to persist over the next 10 years and have a large impact on Manhattan specifically?
JH: Mortgage rates driving carrying costs up are causing properties with above-average monthlies to come under additional scrutiny. Buyers know monthlies tend to only go up, and are thus placing even greater value on properties with low maintenance. I have always been a fan of paying a higher price for a property with lower maintenance than vice versa.
What are the most surprising trends in the luxury market over recent years that you wouldn’t have originally anticipated?
JH: Probably the most surprising, from someone who’s lived in Manhattan for 25 years is the fact 57th Street (the main thoroughfare cutting across Midtown) became Billionaires Row.
What effect, if any, do you predict the Millennial generation might have on the Manhattan real estate market and why?
JH: Millennials tend to be more focused on quality of life issues than grandiosity for the sake of grandiosity. I would expect a focus on neighborhood over size, on environmentally friendly over extreme, over-the-top comfort, on requirements for pet friendly buildings and neighborhoods, and desire for efficient amenities. Millennials are also accustomed to transparency, and the NYC real estate market has been shifting to a more transparent marketplace. In this way what millennials expect is what this marketplace already delivers.
Are you seeing any noticeable reactions to the new tax reform laws that might be pushing buyers to purchase real estate in other U.S. markets?
JH: Despite some of the rhetoric surrounding the tax reform, we do not believe it will produce a significant extended negative effect on the Manhattan market. Taxes have been high in NYC for decades, yet still did not widely cloud buyers’ perception of investment value; also, an improving economy such as that we are in is generally positive for markets. However, there is the possibility the continued increasing trend toward telecommuting will produce softness in heavily taxed states like NY over the longer term. There are also pockets of the market being harder hit than others by recent changes. This is a short-term effect in part due to a higher percentage of pied-a-terre owners and more owners choosing to sell, plus less demand at present.
Whether it be due to listing price or unique circumstances, what is your most significant sale as of late?
JH: We closed yesterday on the sale of 310 East 53rd Street, 6C. This was a $5.9M listing that had been on the market previously without selling. We have a niche specialty of successfully repositioning listings that did not have success in their initial marketing term. We felt the issue for this property was not one of pricing, in this case it was one of marketing and/or exposure as buyers seeing the property had not been forming an emotional connection. We reflected on the potential lifestyle(s) the property could provide and identified those target markets. We then staged the space, including the over 1,350 square foot wrap around terrace, to appeal to those target markets. Ultimately we closed within 1% of the asking price.
How have you overcome the typical challenges associated with scaling your services so quickly?
JH: I have grown my team very organically, responding to the needs of my client network with a proactive outlook rather than with any specific aspirations for growth in size or otherwise. I started with a single assistant 12 years ago and now have a seven agent operation.
Your name continuously stands at the forefront of NY real estate, what has been the key to that success?
JH: We take a very analytical approach to the valuation of real estate, while balancing this science with the art of marketing and sales. Our comparative market analysis is multi-faceted and interprets a broad spectrum of data that can then be leveraged on our client’s behalf. This approach has served our clients well and led to a broad and repeat referral network.