Issue 112 - NYC Real Estate Recovery in a Post-Covid World

536 2nd Street GARDEN

155 West 68th Street 1203

641 Fifth Avenue 33F34EF

446 East 149th Street

450 East 52nd Street 11FLDP

53 West 53rd Street 24D

53 West 53rd Street #PH78

320 East 42nd St 2403

519 West 23rd Street 7

260 Park Avenue South 10I

1593 Deerfield Road

136 East 56th Street 8H

51 Crosby Street 3

445 Lafayette 110C

1001 Fifth Avenue 110C

53 West 53rd Street #38C

53 West 53rd Street #30B

53 West 53rd Street #66

53 West 53rd Street #72B

53 West 53rd Street #21A

53 West 53rd Street #53A

53 West 53rd Street #17B

53 W 53rd St #PH76

53 West 53rd Street #71

53 West 53rd Street #20B

53 West 53rd Street #16F

Issue 112 – NYC Real Estate Recovery in a Post-Covid World

August 1, 2025

It has been more than half a decade since we first heard of Covid-19. The ensuing pandemic quickly changed everything — including the real estate market. Thankfully, we have collectively shaken off our initial panic and confusion and are now armed with perspective. Oh, how far we have come, especially when it comes to housing.

According to many top-tier press predictions, big-city real estate — including in New York City —wouldn’t recover until well into 2025. Happily, several recent articles, particularly one by Matthews, a real estate investment firm, state that we are “far ahead of schedule, the city has seen jobs rebound, population recovery, and an increase in demand for quality assets.”

To see this progression, here’s a quick recap: Starting in the spring of 2020, pandemic restrictions instituted in NYC led to many rapid changes — namely, job loss, doing anything and everything we could remotely, and changing the way we ate, slept, worked, and played. They changed how we connected with people and, most of all, reframed our priorities. All these factors played into forcing many people out of large urban centers and into more rural areas.

Without the need to commute, many people longed for living spaces in less populated areas where they could enjoy fresh air and exercise, and more importantly, connect with family. As a mother of two under the age of 11, it was a very formative time for me in terms of human connection and cultivating familial intimacy. Having eye contact and being fully present with family members in close proximity was so valuable.

Those who stayed in NYC wanted homes set up for comfort and functionality, with larger spaces, in-unit offices, more functional kitchens — Who wasn’t learning how to bake sourdough bread? — and private outdoor access.

As an agent selling in such an unknown time, I initially had no surefire idea how to advise clients. I was receiving calls from owners of truly beautiful homes who were frightened and longing for safety, security, good air quality, a sense of community… They were relocating to places that offered those things: the Hamptons, Westchester, Connecticut, Telluride, and Florida. There was such a mass exodus that we initially saw NYC become somewhat of a ghost town.

We also saw an unprecedented boom in the secondary market, bringing those prices up exponentially. The vacancy rate was so tight, but people were willing to pay exorbitant amounts just to get out of cities and replant themselves next to trees, mountains, lakes, and oceans.

According to a recent article in Fast Company, “From summer 2020 to spring 2022, the number of active homes for sale in most housing markets plummeted as homebuyer demand quickly absorbed almost everything that came up for sale.”

However, NYC is ever resilient. We quickly adapted and made many changes to accommodate renters, buyers, and sellers in a state of flux. The industry pivoted. We became used to “the new normal.”

Enter: digitization. We all quickly became familiar with Zoom, using it when buying and selling apartments. In one particular instance, I sold a one-bedroom apartment on East 22nd Street for $2 million without the buyer ever setting foot in it! She had lived in the building before relocating to Europe and needed to return to Manhattan. The deal was literally finalized by just showing her each room via video — opening and closing all closets and drawers — because she couldn’t be there in person. It was the first time I’d ever seen someone buy something without actually walking through the property.

Who would have thought that this digitized trend would persist with such intensity into post-pandemic times? According to an article last month by luxury publication Haven, the digital revolution has become the industry standard. It has led to real estate’s rebound.

“The most visible transformation lies in the widespread digitization of real estate transactions and marketing. The Covid pandemic changed business culture in NYC permanently through a necessary integration of digital platforms to conduct commerce and make deals,” Haven notes.

“What once seemed like temporary measures have become the industry’s new foundation, with virtual tours, digital staging, and online closings now representing standard practice rather than innovative alternatives. This digital transformation extends far beyond convenience, fundamentally altering how properties are marketed and experienced,” the article continues.

I believe our desire to reconnect with nature has carried forward into the demand for a sustainable and environmentally supportive lifestyle choice.

Simultaneously, there’s been a shift in focus to properties with quality-of-life amenities, such as infrared saunas, cryotherapy, pool rooms, and relaxation rooms featuring meditation, yoga, cold plunges, and hammams. They have all become the rage. Alongside this is the more advanced technology of AI, which seamlessly integrates home automation for various functions, from temperature control and audio/video systems to adjusting lights and window shades.

Old-school key elements such as natural light, open views, indoor air quality, and well-appointed rooms are still in demand, and will always remain so.

All in all, City Journal captured the rebound perfectly: “New York is surviving — if not thriving — defying the worst pandemic-era predictions. Few today would call the city ‘completely dead,’ as James Altucher infamously did in 2020.”

The article explains that the city’s economy appears to have bounced back, something unimaginable in spring 2020: “In December 2019, New York had a record 4.160 million private-sector jobs. By December 2024 (the most recent data available), that number had grown to 4.246 million—a nearly 2.1 percent increase. Considering that one in five jobs had vanished by May 2020, this is no small feat. More economic activity is also visible on the transit system, though work-from-home habits persist: subway ridership hovers by just above three-quarters of pre-Covid levels.”

So, it is no surprise that real estate is also slowly rallying once again. The most prominent comeback is the co-op market, which was decimated in Covid’s wake.

A mid-2024 Partnership for New York City survey of white-collar firms found that in-office employment had recovered to slightly below three-quarters of pre-Covid levels. While most workers are back in the office, including those in financial institutions and other large corporations, many companies are working on a hybrid schedule that includes in-office/work-from-home arrangements.

I think Covid — such a wakeup call! — reminded us that nothing is certain. It has given us perspective on what is truly important: family, community, and connections. The work-life balance has become a priority. The pandemic forced many people to look inward, to embrace and reorganize their internal landscape to survive such a confronting and confining time.

This shift is clearly reflected in the current market — which, according to Haven, “reflects a lasting evolution, not a temporary shift.” Digitalization, lifestyle amenities, and the focus on community are now vital elements in New York City real estate, driving up premium prices across all segments of the market.

I concur with Haven’s endnote, which prophesizes: “Looking ahead, the market’s success will likely depend on its ability to continue evolving in response to changing lifestyle preferences and technological capabilities and demand.”

It seems that based on these demands, people have gravitated towards quality-of-life neighborhoods — those that provide a healthy live-work balance. These areas have garnered pricing and property sales well above the anticipated. The new lifestyle choices have already been reflected in myriad ways. For example, theaters have moved up their ‘curtain’ times from 8:05 p.m. to 7:30 p.m., and many restaurant kitchens are closing at 9 p.m. instead of midnight. It appears that a unified consensus about the desire to slow down has influenced a change in operational hours, as well as within living environments.

Here’s to continued hard work, while maintaining a bit more balance and recognizing that if NYC were ever going to fall, it would have been when it experienced a mass exodus. But in true New York City form, not only did it rally, but it also superseded every expectation, as it always does. Have a great summer!

Issue 123 – The NYC Pied-à-Terre Tax and its Implications on the Real Estate Market

July 1, 2026

Lately, we have been hearing the slogan “Tax the Rich” frequently. This is often espoused in reference to the newly implemented pied-à-terre tax in NYC.

It implies the rich aren’t paying taxes. The reality is quite different. Yes, there are some very wealthy people who pay far less in taxes than others earning the same or similar amounts. But New York City taxpayers pay the most local taxes in all of the U.S. The laws that need to be addressed are federal ones, not local. The loopholes touted are affecting just a select few, when in reality most high-net-worth folks are indeed paying a lot of taxes — especially New Yorkers, who pay $21 billion more to the state every year than the state spends on NYC.

The latest controversy stems from New York City’s enactment of a pied-à-terre tax—an annual surcharge on high-value homes that are not used as a primary residence. If you own a luxury second home in the city, you may now have a recurring tax exposure on top of other friction costs. The tax is also an annual recurring fee, not a one-time hit like the mansion or transfer tax, which makes it more pervasive.

According to a recent report by the NYC Comptroller, the legislation is expected to phase in from July 1, 2026, through June 30, 2028 (fiscal years 2026—2028), with the first phase focused on city “market value” thresholds. Early reporting indicates that the tax applies broadly to high-end second homes and provides different treatment for single-family homes versus co-ops and condos. For houses valued at roughly $5 million or more, the surcharge has been reported at 0.8%–1.3%. For co-ops and condos, the initial phase appears tied to Department of Finance values starting around $1 million, which can translate into a much higher market sale price.

I am seeing a lot of confusion about how this will be implemented. Essentially, people believe that any sales price over $5 million will be affected, when in fact Phase 1 will be based on land value, not the transactional equivalent sale price. For example, a property valued at $844,000 may not be captured by the pied-à-terre tax. It’s less than $1 million and nowhere near $5 million.

However, Phase 2 (for fiscal years 2028–2031, beginning July 1, 2028) becomes a much more speculative concern. Early indications suggest that the tax will be based on the more transactional side of things. It may even work on factoring a five-year average; we simply don’t know yet.

Some savvy buyers are trying to close before Phase 1 starts. Others are trying to keep their price below $5 million and then essentially work any credits as a side agreement to avoid the potential second-phase hit.

As Business Insider reported, “In its first two years, the tax will rely on Department of Finance ‘assessed values’ to determine which homes will face a new charge, while the city and state work out a new valuation system.”

Likewise, a recent CNBC segment details: “Billionaire and Citadel CEO Ken Griffin became the face of the tax after New York City Mayor Zohran Mamdani posted a video in front of Griffin’s penthouse apartment announcing the tax.”

I believe the pied-à-terre tax punishes people who use our services less than full-time residents. They also pay massive transfer and mansion taxes and typically don’t use our schools — a huge portion of real estate tax revenues.

My view is that this will not destroy the New York market, but it will absolutely change behavior at the margins. Buyers are already more sensitive to carrying costs, monthly common charges, assessments, the mansion tax, financing costs, and now an additional annual second-home tax. The psychological impact may be just as important as the financial one.

The highest end of the market will feel this first. For discretionary buyers, especially those comparing NYC to Palm Beach, Miami, Aspen, London, or other global luxury markets, this becomes another line item in the decision-making process. It may not stop a true New York buyer, but it may slow them down, sharpen their negotiations, or push them toward renting instead of buying.

As a result, I expect high-end rentals to benefit. A buyer who wants a New York City presence but does not want the tax complexity may choose to rent a trophy apartment instead. That could strengthen demand for luxury rentals, especially furnished, turnkey, white-glove inventory.

For co-ops, the impact may be more nuanced. Co-ops already have a smaller buyer pool because of board scrutiny, financing restrictions, and liquidity requirements. If the tax makes second-home buyers more cautious, certain high-end co-ops may feel additional pressure, especially those with significant monthly maintenance or less flexible sublet policies. That said, as I always point out, the very best buildings with scarcity, provenance, service, and location will still hold value.

I have not yet seen a wave of people selling solely because of this tax, but I have absolutely seen buyers pause, ask sharper questions, and reconsider the total cost of ownership. The conversation has shifted from “What is the purchase price?” to “What is my all-in annual exposure?”

Other markets have tried versions of second-home or vacancy-style taxes, with mixed results. In some places, they created revenue and pushed underused housing back into circulation. In others, they caused buyers to become more cautious or redirected capital elsewhere. New York is different because it remains New York — but the city cannot assume that capital is captive.

Again, citing Business Insider, “Hochul and Mamdani estimated the tax could raise $500 million.”

So, are there any benefits? Potentially. If the revenue is used responsibly, it could support city services and housing priorities. It may also create a clearer distinction between end-user demand and purely discretionary ownership. But from a market perspective, the risk is that it adds friction at a time when the luxury buyer is already highly selective.

My advice to second-home buyers is simple: do not overreact, but underwrite carefully. Understand whether the property will be classified as a primary residence or pied-à-terre. Review the building’s carrying costs, taxes, assessments, liquidity requirements, and resale profile. Buy quality, buy scarcity, and buy something you would be comfortable owning through a softer market.

It’s important to keep all in perspective: Mayors come and go, and when you start impacting the very hands that feed you in one of the most capitalistic cities that ripple through the nation, I think we stand the test of time on how we are going to navigate this.

The New York City buyer is not disappearing. But the casual, optional buyer now has one more reason to pause — and in this market, that matters.