NYC Home Sales to Slow on Supply Gap, Brown Harris Stevens CEO Says

(Bloomberg) -- New York City’s torrid housing market faces a slight slowing in sales in 2022 because of higher interest rates and a lack of supply, Brown Harris Stevens Inc. Chief Executive Officer Bess Freedman said.

“The Fed announced that rates will go up maybe two to three times next year, so we may see a little bit of a slowdown,” Freedman said in an interview on Bloomberg TV’s Surveillance on Tuesday. “Also, supply has diminished because demand is so heightened.”

Housing stock in many city neighborhoods is tight and prices have jumped. Manhattan’s luxury-home market is ending a record year, with 1,877 contracts signed at $4 million and above, the most in data going back to 2006, brokerage Olshan Realty Inc. said in a report Wednesday. That was almost three times the number of deals in 2020 and twice as many as in 2019.

“Remember, 2021 has been a phenomenal year in housing and much of that is attributable to the fact that the vaccine came out a year ago,” Freedman said. “People are feeling very comfortable, they’re returning to cities.”

Home buyers are more diverse than in the recent past. “We’re now even seeing millenials buy, which in the past, they were considered kind of the unburdened group that wanted experiences versus commitment,” Freedman said. “The fastest-growing segment of our market is the Hispanic community, which is fantastic. I think we’re going to continue to see spending but it may slow down simply because supply is shrinking a bit.”

Brown Harris Stevens, a New York-based real estate firm founded in 1873, is owned by Terra Holdings LLC, one of the largest closely held real estate service companies in the U.S.

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