When it comes to pouring vast amounts of cash into real estate, no city in America can rival New York. The world's wealthiest buyers come to New York - Manhattan in particular - to buy real estate.
Ryan Serhant, the star of Bravo’s Million Dollar Listing and a broker with Nest Seekers International told Yahoo Finance he estimates about 50% of his buyers are from overseas. So, why the rush of money into the big apple? He says that as expensive as New York is, when compared to the rest of the world, New York City is still relatively affordable. “If you look at the top ten global cities for real estate, New York is in the middle. What you can get for your money here - in Hong Kong it’s a closet! And here we think these numbers are insane. Everywhere else in the world, we are kind of a bargain.” He sees buyers from Russia, South Africa, South America and of course, China.
Buyers from China spent an estimated $22 billion dollars in the twelve months ended in March of this year, according to the National Association of Realtors. That's a considerable jump from $12.8 billion in the prior period. The NAR now estimates Chinese buyers make up nearly a quarter of foreign transactions.
Along with the foreign buyers, there are also plenty of domestic buyers looking for high-end real estate investments right now. His clients hail from New York City’s suburbs, including Long Island, New Jersey, and Westchester. And then there’s the oil and gas money from Texas.
So where are they buying? Serhant tells Yahoo Finance high-end international buyers are dropping millions on apartments in ritzy condo developments such as One57 and 432 Park Avenue, both situated close to the city’s crown jewel: Central Park. Other properties of particular interest to the super-rich international investor, according to Serhant, include 200 11th Avenue and the ultra high-end Ritz-Carlton building in lower Manhattan's Battery Park neighborhood.
There are a number of reasons the city’s real estate is especially attractive to foreign buyers. It serves as a relatively safe place for the wealthy to park their money. For Chinese and other international buyers, it's also a way to invest in an asset dominated by the U.S. dollar, with the added benefit of providing potential income from rental and/or property value appreciation.
Plus, the options for opulence are endless. Serhant’s listing include some pretty high-end properties: a penthouse duplex at the Ritz-Carlton, listed for a mere $118.5 millon, and a penthouse apartment at 200 11th Avenue that has a glass vault and your own car elevator. And proximity to Central Park doesn’t hurt when it comes to bragging rights. He quipped, “But they get to tell people, hey I’ve got a place on Central park in New York. Their kids can stay in a lot of these places.”
Owning a home in the Big Apple is akin to owning a piece of expensive jewelery. And just like you don’t wear your jewels all the time, wealthy buyers are not always living in these status apartments. The Census Bureau estimates that 30% of all apartments around Fifth and Park Avenue on the Upper East Side are empty most of the year. Serhant says he’s not surprised as rich folks tend to live in multiple places such as Los Angeles, Cape Town or Rio.
Watch Yahoo Finance for more from Ryan Serhant on the ritziest, glitziest properties he’s seen and the unique features they offer buyers.
Milanee Kapadia is a freelance contributer to Yahoo. You can follow her on Twitter @MilaneeKapadia.
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