May 22, 2025
If you’re keeping an eye on the NYC housing market in 2025, you’ve probably noticed it’s balancing itself pretty carefully. Mortgage rates are still high, but surprisingly, transaction volume is up.
Buyers and sellers are starting to meet in the middle on prices, even though overall inventory is on the decline. As a real estate professional watching this day in and day out, here’s my take on what’s happening and what you should expect heading into 2026.
Where We Stand Right Now
The number of homes going under contract in NYC jumped 10.7% year-over-year as of February 2025. While that’s a slight drop from December (typical because of the holidays), things picked up quickly. Historically, February through April are busy months, and that trend is holding true this year.
When it comes to pricing, sellers are adjusting to reality. The citywide median asking price dropped 2.1% year-over-year, and homes entering contract had a 3.7% dip, settling at about $890,000. In simple terms: sellers are finally pricing their homes to match what buyers can afford.
Price Changes Across Boroughs
Manhattan took the biggest hit, with a 6.3% drop in median asking prices to $1.55 million. Meanwhile, Brooklyn’s median climbed 4.8% to about $1.1 million, and Queens jumped a whopping 12% to $700,000. Different boroughs are telling very different stories right now, and it’s more important than ever to know your local market.
For some perspective, the national median home price was around $407,500 at the end of 2024 — so even with these adjustments, NYC remains in its own pricing world.
Tight Inventory is Driving the Market
Inventory is a little tighter than it was a year ago, with about 14,840 homes on the market — a 3.5% decline year-over-year. That said, new listings are up 12.6% compared to last January, showing that sellers are more motivated.
Since September 2024, homes have been flying off the shelves faster than new ones are coming online. This is something to watch closely because if it keeps up, it could start pushing prices higher again.
Buyers vs. Sellers: Who Has the Advantage?
Right now, it's pretty balanced. Sellers are pricing more competitively because they know buyers are feeling the sting of 7% mortgage rates. But buyers aren’t being reckless either — they’re negotiating harder to offset those higher monthly payments.
Neither side has a major upper hand, but that could change quickly depending on what happens with rates and inventory.
Trends to Watch
Sellers in Manhattan are dropping their prices in sought-after neighborhoods like Greenwich Village. Brooklyn remains hot — with over 30 neighborhoods where the median asking price is topping $1 million.
Queens is seeing a condo boom, which is nudging up prices there too. Plus, with borrowing costs high, co-ops are making a bit of a comeback thanks to their lower price points compared to condos.
Mortgage Rates: The Elephant in the Room
Mortgage rates are hovering around 7%, and while that’s making buyers a little more cautious, it hasn’t crushed demand yet. Some are waiting on the sidelines hoping for a dip, but many are just adjusting their budgets or negotiating harder.
High rates have definitely changed the buying landscape, but NYC's core demand is strong enough to keep things moving.
Looking Ahead to Spring 2025
I expect more of the same: steady buyer activity, smart seller pricing, and inventory staying a little tight. If mortgage rates spike again, it could put a chill on things.
If they dip, competition could heat up fast. Either way, this market is shaping up to be stable — no boom, no bust, just a steady grind forward.
What About the 2025-2026 Forecast?
Experts are predicting modest growth for NYC real estate. Zillow is forecasting a 1.6% increase in home values across the metro area by the end of 2025. That’s not dramatic, but it’s steady — and steady is good for long-term health.
Looking at the rest of New York State, places like Syracuse, Kingston, and Rochester are expected to see much stronger gains — upwards of 5-6% in some areas. It just shows how different markets within the same state can move at totally different speeds.
Will Home Prices Drop?
A crash? Highly unlikely. Demand is still high, inventory is still tight, and New York remains one of the most desirable places to live. Even if rates stay elevated or the economy slows, it’s hard to see a dramatic collapse.
Prices might plateau or adjust slightly, but major crashes don’t seem to be on the horizon.
My Personal Advice
If you're buying: don’t sit around waiting for a crash that’s probably not coming. Focus on finding something that fits your lifestyle and your budget.
If you're selling: the market is healthy enough to make a move now, especially if you price correctly and market aggressively.
If you're investing: look at places like Syracuse, Buffalo, and Rochester where your dollars can stretch a lot further than in NYC proper.
Peeking into 2026
If the economy remains stable and interest rates don’t shoot up, we should see more of the same: slow, steady growth. Of course, real estate is always full of surprises, but the fundamentals here are solid.
Disclaimer:This content is meant for informational purposes only and is not intended to be construed as financial, tax, legal, or insurance advice.
