January – 2026 Market Update

The LevinKong Team hopes this message finds you well and staying warm through the frigid New York City winter temperatures. While the city remains deep in winter, the real estate market is beginning to show signs of warming as we approach what is shaping up to be a strong spring surge.

As we move through the early part of the year, the economic backdrop remains mixed but constructive. Inflation has proven stubborn and, as expected, the Federal Reserve has not yet implemented rate cuts. However, most experts still anticipate easing later this year. Once rates begin to decline, we expect long-locked-in sellers to reenter the market, helping increase inventory and expand buyer options.

Consumer spending continues to be driven largely by the top 20% of income earners, providing meaningful support to housing demand. Equity markets remain another tailwind, with the S&P 500 up approximately 18% in 2025 and expectations are for a continued bull market. Combined with projections for a strong bonus season, these factors should fuel buyer confidence and support the trade-up market.

Following the Mamdani mayoral election, market activity has unfolded differently than many initially expected. The high-end segment has seen increased demand, and proposed restrictions on multifamily sales were quickly rejected by City Council, easing investor concerns.

Rents remain at all-time highs, and limited inventory continues to support first-time and lower-priced buyer activity. Brooklyn is expected to maintain strong demand, as is prime Manhattan, while slower areas of Manhattan should benefit as more buyers reenter the market.

Looking ahead, buyers should see more choices as additional sellers come to market. The spring surge is expected to be meaningful, led by turnkey and luxury properties, though unrenovated and less prime homes should also see renewed interest as buyer depth improves.

We project 2026 to be a normalization year for NYC real estate, with modest appreciation, gradually improving inventory, and a competitive spring market. Current forecasts call for approximately 4–6% price growth. In 2025, roughly 60% of transactions were all-cash, though we anticipate financed deals to increase as borrowing conditions improve. New development inventory remains extremely limited across Manhattan and Brooklyn, limiting discounts and concessions.

In Manhattan, total supply is down 6% year-over-year while demand is up 2%. Approximately 11% of sales are closing above asking price, and the median sales price has risen 3.5% from last year. In Brooklyn, supply is up slightly at 1.5% year-over-year, while demand is down 5%. Despite normalization, the borough remains highly competitive, with price per square foot up 7% year-over-year and 22% of sales closing above asking.

The NYC real estate market is vibrant and full of opportunities. With the LevinKong Team, you can confidently navigate this dynamic and intricate real estate market. Our decades of experience and data-driven, research-based approach are your best tools for success in this environment. We’re here to maximize your goals, protect your investments, and answer any questions or concerns you may have about the market or complex decisions. Our unwavering commitment to your success and our dedication to supporting you every step of the way are a testament to how much we value and care for our clients.

As always, the LevinKong Team is here to help you achieve your real estate goals. Please reach out to us with any questions or for personalized advice.