NYC ultra-luxury market surges amid global unrest

A potent mix of global instability and financial anxiety is supercharging demand for New York City’s priciest homes — even as broader luxury segments grapple with stubborn inventory shortages.

HousingWire Data shows pending sales in the ultra-luxury single-family market — defined by a $4.3 million median price — surged 200% in the latest weekly period.

At the same time, price reductions among those high-end properties have fallen to 11.8% — well below the historical New York City average of 17.9%.

“The luxury market now is very undersupplied and extremely busy,” said Ian Slater, founder of Manhattan-based Trove Partners at Compass. “[I’ve been] busier than I have been in a long time. I think more people and more wealthy people are nervous about the stock market and volatility.

“I think they’re wanting to put their money into hard assets. So, real estate is obviously like a great hedge against that.”

Slater said he is seeing an increased number of families relocating from Dubai, which experienced an enormous post-COVID market surge as wealthy individuals fled London and New York.

He has shown listings recently to two families living in Dubai who now want to move to New York — and move quickly.

“Theoretically, you think that people are nervous and don’t want to make big decisions and don’t want to pull the trigger,” said Slater. “But real estate is a hard asset, and because of the general safety and stability of New York, a New York apartment or house seems like a pretty good option.”

On domestic political unrest, Slater said clients have grown somewhat numb.

“There’s less reactivity to things that he [the President] says than there used to be.”

Supply constraints impeding demand

While demand signals are positive in the highest price tier, the broader luxury market shows a more nuanced picture.

New listings in the multi-family luxury segment — condos and townhomes at a $2 million median — dropped 17% to 179 properties. The co-op market saw a 26% decline in new listings.

“We have a serious supply problem for things at the high end, up at the top of the market that are renovated, a very serious problem,” Slater said. “I have a lot of clients who want to move that don’t want to renovate. They want something bigger because they’ve got significantly wealthier in the past five years, and we don’t have a significant amount of people selling.”

Slater described an environment where ultra-wealthy owners are collecting real estate as opposed to selling one property and reintroducing another to the market.

“My entire inbox is frequently brokers looking for inventory, and people calling me and asking me if I have anything off market or coming up,” he said. “Buyers are looking at the market and not really finding anything that they like.”

Renovation-ready properties a hidden value

For buyers willing to look beyond turnkey offerings, Slater said opportunities exist in homes needing renovation — a segment many wealthy purchasers still avoid due to lingering fears about costs and timelines.

“I just left a client looking at townhouses,” he said. “I’m looking at things that I think are priced about 20% under where they should be, because they are in need of renovation. The length of time on the market has gotten very extensive for those things.”

The other overlooked opportunity, he said, lies outside Manhattan’s hottest enclaves — the Upper East Side, Upper West Side, West Village, Tribeca and Brownstone Brooklyn.

“If anyone is willing to look outside of these types of super-hot neighborhoods, you’re going to find better deals and a lot more optionality,” said Slater.

Local election drama fades

Concerns about New York City’s election of Mayor Zohran Mamdani drew concern from some wealthy buyers last fall — but those have largely receded, Slater said.

“I have personally only lost one deal because of fear of the mayor,” he said. “There was a lot of talk around him more in the summer. New York is this giant beast. It’s very hard to change it. So, even the wealthiest of the wealthy, who you think would be the most sensitive to anti-business rhetoric, they have to be here.

“Their [limited partnerships] are here. Their analysts are here. The talent is here. The schools are here. That’s not changing under the mayor. The reality of New York isn’t changing.”

All in all, the Big Apple’s biggest real estate clients seem to be doubling down, sometimes renovating where others won’t and showing that New York real estate remains a rain-or-shine powerhouse.