As the Arab nations are shaping up for a historic World Cup, New York's real estate market continues to struggle like their opponents! We have entered what many call a 'deep freeze,' where both buyers and sellers are sidelined. In addition to this logjam, we’ve had a handful of events this month which lean in favor of buyers. Here is a list and their implications on New York real estate.

Midterm elections are (thankfully) behind us!

As expected, Republicans won control of the House and we can now eliminate at least one variable when examining the real estate market both here in New York and nationally. Irrespective of which side of the political aisle you sit on, the recent trend clearly shows that lead ups to pivotal elections create stagnation in real estate markets.

Are tech layoffs the canary in the coal mine?

Some of the U.S.’s largest and best-known tech companies have recently announced massive layoffs, including Amazon, Meta, and Twitter. Many of these firms were big “pandemic winners,” yet now look to cost-cutting measures amid inflation and declining revenue. What makes it more interesting is the speculation that layoffs will likely keep coming in light of a recession.

FTX was the nail in the coffin for crypto heads.

One of the key drivers that we witnessed during the post pandemic real estate buying bonanza was triggered by 'new crypto millionaires.' With the recent collapse in crypto across the board, expect to see some additional ‘desperate’ supply coming from that investor class who might need some liquidity in the near term.

We have good news on inflation, or is it a head fake?

Inflation appears to be subsiding as CPI showed inflation slowed to 7.7% from 8.2% year-over-year for consumer goods. That said, the fight isn’t over just yet. The Fed is expected to keep rates relatively high until we see several months of tamped-down inflation.

To offset high mortgage rates, sponsors are now getting creative. Many top developers, including Extell Development, are offering a “Rate Rewind” program, where the sponsor buys down mortgage rates by 2% each year for the first three of the mortgage. Keep in mind, opportunistic buyers who sign up for higher mortgage rates will have an opportunity to refinance down the road once rates reverse course.

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