Will Interest Rate Hike Lower New York Condo and Co-Op Values? Property Executives' Views Are DivideDecember 14, 2015
NEW YORK, NY--(Marketwired - December 14, 2015) -
The Federal Reserve is expected to raise short-term interest rates this week, and New York City real estate executives are divided as to what the impact would be on property values and real estate development here.
Forty-one percent of property professionals say condo and co-op values will decline if the Fed raises rates, while 34% say values will stay the same, and 18% say they will actually go up.
That's according to accounting firm Marks Paneth's latest Gotham Real Estate Monitor, a survey completed last week of over 130 New York property owners, brokers, engineers, accountants and lawyers.
Meanwhile, half (50%) of the property executives say an interest rate hike will slow the rate of new condo and co-op development in the city. Forty-one percent say a rate increase won't slow such development, and 8% aren't sure.
But the majority -- 62% -- of executives say a rate jump will not curtail foreign investment in New York condos and co-ops.
"Given how sensitive property values are nationwide to interest rates, New York property executives' divided view on the impact in the city of a rate hike suggests that they perceive the condo and co-op market to be pretty solid," says William H. Jennings, Partner-in-Charge of the Real Estate Group at Marks Paneth. "And it seems that professionals believe that foreign investors in New York apartments are hard to scare away."
To speak with a leader from Marks Paneth's Real Estate Group, please contact Katarina Wenk-Bodenmiller of Sommerfield Communications at (212) 255-8386 or Katarina@sommerfield.com.
The Gotham Commercial Real Estate Monitor from Marks Paneth represents the findings of a survey of 165 real estate professionals in New York City. The research employed self-administered questionnaires completed in person and online by respondents. The list of professionals surveyed was compiled by Marks Paneth LLP, the research sponsor. Michaels Opinion Research, Inc. drafted the survey questionnaire and tabulated the responses. Interviews were completed during the period of November 11th to December 8, 2015.
About Marks Paneth
Marks Paneth LLP is an accounting firm with more than 550 people, including over 70 partners and principals. The firm provides public and private businesses with a full range of auditing, accounting, tax, consulting, trade remediation and valuation services as well as litigation and financial advisory services to domestic and international clients. The firm also specializes in providing tax advisory and consulting for high-net-worth individuals and their families, as well as a wide range of services for international, real estate, hospitality, media, entertainment, nonprofit and government clients. The firm has a strong track record supporting emerging growth companies, entrepreneurs, business owners and investors as they navigate the business life cycle.
The firm's subsidiary, Tailored Technologies, LLC, provides information technology consulting services. In addition, the firm's membership in Morison International, a leading international association for independent business advisers, financial consulting and accounting firms, facilitates service delivery to clients throughout the United States and around the world. Marks Paneth, whose origins date back to 1907, is the 35th largest accounting firm in the nation and the 9th largest in the mid-Atlantic region. In addition, readers of the New York Law Journal rank Marks Paneth as one of the area's top three forensic accounting firms for the sixth year in a row.
Its headquarters are in New York City. Additional offices are in Washington, DC, New Jersey, Long Island and Westchester. For more information, please visit www.markspaneth.com.
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