Foreigners Reawaken to New York

In a decided movement, the amount of foreigners looking for New York Real Estate has increased dramatically over the past quarter. It almost feels that the farther away from the trees they are, the more they can see the forest, and they want some of it. Many are driven by the incredible lows of the dollar (at the time of this writing it was trading at X vs. the Euro), and others, after reading enough negative press about the American economy, are looking to capitalize on opportunities. In short, there is a belief that much equity will be created when our recovery occurs. While not showing up in closings yet, as many are looking, this trend should be reflected in sales and closing over the next 12 months. I am currently working with more foreign families today than I was in the heights of 2007.

Another surprise buying group has appeared: local investors who are not primarily in the real estate business. These individuals have significant amounts of investment capital, may have been burned in the stock market, and see this as the time to look for multifamily opportunities. Similar to foreign buyers, these investors are primarily looking for long term appreciation, B+ and better locations, tenancy which would allow for third party management. Current cash flow is secondary. Their belief about residential rents is that "we may not be at the bottom, but we are a lot closer now than we were in January of 2009". Put another way, greed is coming back into the market, and that is a good thing.