Consumers have, for the most part, accepted price hikes, and have not pulled back on spending. Fed Chair Jerome Powell has said, “bottleneck effects have been larger and longer-lasting than anticipated… while these supply effects are prominent for now, they will abate. And as they do, inflation is expected to drop back toward our longer-run goal” thus indicating that the Fed was not surprised by the readings, despite having touted ‘transitory’ and ‘short term’ inflation in previous discussions. There is also no exact timeline indicated for a return to normalcy.
Thus, it is becoming even more important to make smart monetary decisions in all aspects of life, real estate included. This month, we want to discuss where the ‘smart money’ is buying in each of the hot markets so as to prevent buyer’s remorse in years to come.
New York City
The outer boroughs are feeling a lot more love these days, and we are seeing a flight to quality and futureproofed investment opportunities in buildings that will stand the test of time. COVID accelerated demand for boutique developments of less than 50 units, often featuring private elevator or ground floor access and parking accessibility. Privacy and suburban amenities with added convenience and commutability is top-of-mind.
Bianca D’Alesso, Nest Seekers Director of New Development, explains: “Long Island City, Williamsburg and Greenpoint offer new buildings filled with amenities. From full service with tremendous views to boutique options near park spaces or along the waterfront with parking in close proximity to Manhattan.”
Long Island City is in the borough of Queens and just 3 miles from Manhattan. The neighborhood features 8 subway lines, including the 7, E, M, R, N, Q, and G, 13 bus lines, and CitiBike stations. It also has the East River Ferry that stops at Hunters Point South and Gantry Plaza State Park. LIC has industrial roots but many of the former factories have been converted to centers of arts and culture, like the Noguchi Museum, MoMA PS1, and SculptureCenter.
Williamsburg has been trending for years now, and has even been called the ‘Avocado Toast’ of NYC by Conde Nast Traveler due to its bevvy of hip coffee shops and creative retail stores along Bedford Avenue. Williamsburg is connected to Greenpoint by McCarren Park, Brooklyn’s equivalent of Central Park, and is passing the torch of neighborhood darling to its’s northern neighbor. Those who feel priced out of Williamsburg can look to Greenpoint, which still offers an intimate community vibe where the local bodega owner knows your coffee order in the morning. The major downside of Greenpoint is reduced public transportation options compared to Williamsburg, but with the shift toward remote work for many, interest in this vibrant, historic neighborhood is now surging.
Palm Beach
Palm Beach has been called the ‘hottest real estate market in the world’ by CNBC, but prices on Palm Beach Island have many saying ‘no way!’ What’s the best way to get a piece of the action and chic lifestyle without the $3,000 psft asking price?
Check out West Palm Beach, particularly the historic El Cid area which is just minutes from trending restaurants like Le Bilboquet and shopping areas like Worth Avenue and The Royal Poinciana Plaza. Also, new and pre-construction condos like Forte and La Clara offer attractive pricing for those who missed the opportunity at The Bristol a couple years ago.
Even ultra-luxury buyers don’t want to overpay, and are thus increasingly focused on Manalapan, which is about 20 minutes south of Palm Beach Island. Manalapan parcels range from one to three acres and offer 300+’ of ocean frontage with added access to the Intracoastal for dockage. In contrast most Palm Beach Island lots are half the size and don’t offer the same access to multiple waterways.
For those looking to a more traditional Florida lifestyle, focused on boating, golf, and outdoor living, Jupiter and neighboring Tequesta may be more of a focus. These neighborhoods have also seen a lot of action over the past year, so smart money is moving even further north, to Vero Beach. In Vero, vacant oceanfront acre parcels are priced between $3-5 million vs. the same land in Palm Beach County ranging anywhere from $15-$30 million (if you can find it).
Miami
We all know South Beach, but where do the Miami locals choose to live? The answer is increasingly Coconut Grove or Downtown.
Coconut Grove is now home to Miami legend Dave Grutman’s Groot Hospitality Group’s new headquarters as well as the much-anticipated Mr. C Residences, however, its history is rich as the oldest continuously inhabited neighborhood of Miami. Located 10 miles south of Downtown, the streets of the Grove are lined with banyan and oak trees, while its shopping areas are boutique and open air, giving a bohemian tropical flair. The Vanguard School and Random Everglades School are considered some of the best in Miami and are both are located within the quiet confines of the Grove. Home prices are higher than many areas of Miami, but awareness and opportunities continue to grow.
Downtown Miami has been overlooked for too long. With close proximity to Brickell and South Beach, it is the central hub the city never really had. The FTX Arena (formerly named American Airlines Arena) shines on Biscayne Bay, with easy access to the People Mover metro that runs from Downtown through Brickell, resembling the closest thing to Manhattan outside of the city. The new 1000’ Waldorf Astoria Residences tower is going to change the Miami skyline forever, and has seen tremendous pre-constructions sales well-ahead of its 2025 expected delivery date. The Mayor of Miami, Francis Suarez, has taken a particular liking to Downtown as we see more and more financial institutions and cryptocurrency leaders move into the area.
Check out this video of the Waldorf Astoria and Mayor of Miami: https://youtu.be/gC_wZ8nAoMI
Not to mention, the State of Florida expects 906 new residents per day through April 2024, representing an annual compound growth rate of 1.53%, with Miami representing a significant stake in this trend. The GDP of Florida is more than $1.1 trillion and has grown by nearly 52% over the past ten years, and Miami is proactively recruiting high net worth individuals and startup talent away from Silicon Valley, thus accelerating job growth and ranking the state as the fifth-best for doing business, according to Forbes.
Greenwich
The Backcountry Greenwich neighborhood had been fading in popularity and price in prior years, but was given new life during the pandemic. The continuation of WFH or hybrid WFH business models seem to be the driving force behind renewed interest, especially when combined with Governor Lamont’s ability to entice corporations to relocate their businesses to Connecticut. Sparce supply has continued despite high demand.
The neighborhood trends seem to indicate that while many buyers from New York City have chosen to move to the suburbs, they still value convenience and community. Greenwich is a town of 65,000 +/- people spanning ~60 square miles, and combines New England countryside living with small, but bustling, villages/town centers. Cos Cob known for its “urban chic” vibes, walkability, convenient shops, parks and train stations make it perfect for commuters balancing city and suburban life.
The best return on investment is often found in secondary or sub-markets; those experiencing above-average population and economic growth. They offer most of the amenities that you would find in spotlight markets without the dense population and/or stiff competition. Secondary markets are less volatile in times of recession and thus are attractive to long-term investors. Thus, instead of positioning these neighborhoods as below their ‘famous’ and oft-storied counterparts, think of them as smart-money opportunities for a higher ROI.
