NYC Property Values Set to Climb 5.7% in 2025

NYC property values are bouncing back with rentals thriving and trophy offices showing promise

Jordan B. & Han-Gwon Lung
January 20, 2025

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Good morning. New York City real estate is rebounding, with property values projected to rise sharply in the upcoming fiscal year, signaling renewed confidence in the market despite ongoing challenges.

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Market Snapshot

S&P 500

GSPC

5,996.66

Pct Chg:
+1.00%

FTSE NAREIT

FNER

767.90

Pct Chg:
+0.17%

10Y Treasury

TNX

4.623%

Pct Chg:
+0.017

SOFR

30-DAY AVERAGE

4.608

Pct Chg:
0.0%

*Data as of 01/17/2024 market close.

PROPERTY MARKET

NYC Property Market Set to Bounce Back in 2025

New York City real estate is regaining momentum, with property values expected to rise sharply after a sluggish performance last year, reports Bloomberg.

By the numbers: The city’s total property market value is projected to climb 5.7% to $1.6 trillion in fiscal 2025, a notable improvement from last year’s 0.7% growth according to a tentative assessment released by the Department of Finance. Residential properties—led by co-ops, condos, and rentals—are driving this rebound with a 7.3% increase.

Leading the way: Brooklyn is leading the pack with a projected 9.4% increase in property values, driven by a significant 15% surge in rental apartment valuations. Staten Island also stands out for its single-family home appreciation, which is expected to rise by 6%.

Zoom out: Rents have soared post-pandemic, with the median rent for a one-bedroom apartment up 21% since early 2020, according to the city comptroller.

Signs of recovery: Commercial property values are set to rise 3.8% to $339.5 billion, fueled by more office workers returning and stronger market fundamentals. Trophy offices lead the rebound, with visits just 14% below pre-Covid levels. Retail and hotels are also gaining, up 2.5% and 5.9%. Yet, office vacancy remains high at 23.4%.

Tax revenue boost: Property taxes, which fund nearly a third of NYC’s $115 billion budget, are expected to rise, with assessed values increasing 3.9% to $311.2 billion. This influx provides critical support for the city’s finances.

➥ THE TAKEAWAY

The big picture: NYC property values are bouncing back, with rentals thriving and trophy offices showing promise. Residential is hot, Brooklyn's hotter, but high office vacancy rates still weigh on the recovery.

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✍️ Editor’s Picks

Banking risks: The SEC is investigating the exposure of three New York banks to rent-stabilized loans, citing concerns over reduced rental income and broader commercial real estate risks.
REIT NAV chart book: Valuations for US equity real estate investment trusts fell in the final quarter of 2024 after improving in the prior quarter.
Housing shake-up: President-elect Donald Trump’s nomination of Bill Pulte to lead the FHFA signals a potential pivot toward privatizing Fannie Mae and Freddie Mac. What happens next?
Bank breakdown: Chicago's Pulaski Savings Bank collapsed in the first bank failure of 2025, with Millennium Bank assuming most deposits and assets amid broader concerns over rising interest rates.
Angels Landing lawsuit: Developers Don Peebles and Victor MacFarlane are suing Los Angeles for $20M, alleging unlawful termination of their $1.6B Angels Landing mixed-use project contract in Downtown LA.

🏘️ MULTIFAMILY

Rent suit: Maryland has filed a lawsuit against RealPage and eight major landlords, alleging illegal coordination to inflate rents across the state.
Portland rebounds: Portland's multifamily market surged in Q4 with a 116% transaction increase, higher occupancy, and $645M in sales, despite rising cap rates and new supply pressures.
Construction starts: December saw a 59% spike in multifamily construction starts, hitting 418,000 units—the highest monthly total in 2024—driven by unexpectedly strong housing demand.
Luxury loan: Mast Capital and Starwood Capital secured a $390M loan for The Perigon, a 73-unit oceanfront Miami Beach condo project that is 75% presold with units starting at $10M.

🏭 Industrial

Small Bays surge: Investor interest in small bay warehouses is growing rapidly, driven by high demand, limited supply, and short-term leases that offer inflation protection.
Teaming up: Bridge Industrial and CPP form a $789M joint venture to invest in high-demand U.S. industrial properties, targeting core markets amid tight warehouse supply.

🏬 RETAIL

Mall markdown: Hull Property Group is set to acquire Charlotte's distressed Northlake Mall for $39M, a steep discount from its 2014 value, reflecting the ongoing decline in suburban mall demand.

🏢 OFFICE

Green deal: PACE Loan Group issued a $24M C-PACE loan for sustainability upgrades at 444 South Flower Street in L.A., enhancing HVAC, plumbing, lighting, and building exteriors.
Foreclosure looms: Unilev faces potential foreclosure on Houston's One Riverway office tower as occupancy plummets to 51% and a $69M delinquent loan nears its March 1 maturity.