The Real Deal - NYC
May 11, 2023
Nikki Field says a long-awaited tide of international buyers is once again driving momentum behind Manhattan’s residential market.
The broker, who heads The Field Team at Sotheby’s International, said a stream of foreign buyers bolstered her business in the second half of 2022 and into the first few months of this year, as skyrocketing mortgage rates slowed domestic activity in the city.
“The big, huge, massive advantage to Manhattan real estate in the third and fourth quarter is that international buyers started coming back,” Field said. “We know through all of our market crises in the past, historically, the international buyer is our savior.”
Securing clients from other countries is big business in New York, but some firms and teams — armed with dedicated regional specialists, diverse language skills and cultural knowledge — are uniquely positioned to rise above the fray.
Market observers have kept an eye out since the onset of the pandemic for the return of international buyers. Investment from the slice of the market had nowhere to go but down after peaking in 2017 with a record $153 billion. But each year since brought different forecasts from players around the world of residential real estate.
Some agents proclaimed their foreign clients’ return to the city to the New York Post in July 2021, one year before Douglas Elliman chairman and CEO Howard Lorber told Bloomberg interest that had slowed again as the strength of the U.S. dollar had impeded luxury sales to international buyers. The topic popped back into the news cycle last month, when the Wall Street Journal reported an influx of overseas buyers returning to cities like New York and Miami.
Although the brokers agreed international buyers were back in the market, when exactly they returned, and in what volume, is harder to track.
Data on buyers’ identities and nationalities are often obscured in public records — particularly at the higher end of the market. Instead, the timeline and population of buyers is left up for debate by the brokers and firms at the forefront.
New York has long ranked among the top destinations for international investment, but took a backseat in popularity among U.S. cities in recent years. The Empire State claimed 4 percent of foreign buyers last year, trailing popular pandemic spots like Florida and Texas, according to National Association of Realtors data.
For Field, the trickle began with Indian buyers toward the end of last year. She later ramped up her Asian global desk as ultra-high-end buyers from Singapore, Taiwan and Hong Kong reemerged, and by the start of this year, Field had opened her Canada desk.
A lot of international buyers are actually pleasantly surprised about how strong the city is now and pleasantly surprised that they don’t feel like it’s unsafe.
CHARLIE ATTIAS, COMPASS
Among some of her clients’ chief concerns is the perception of crime as broadcast by international press coverage. One of Field’s buyers, the mother of an Asian family she’s worked with for nearly 20 years, asked her if she carried a gun and whether she should advise her daughter to get a permit for one when she moved to the city for her job.
Other brokers pointed to concerns such as trash cleanup, homelessness and changing policies that may make it more difficult for foreign investors to buy property.
“A lot of international buyers are actually pleasantly surprised about how strong the city is now and pleasantly surprised that they don’t feel like it’s unsafe,” Compass’ Charlie Attias said. “In other parts of the world, it’s much more unsafe, especially in big cities.”
Attias heads an 11-person team with a particular focus on international clients. With this niche in mind, he assembled a team of agents with an emphasis on international experience and language skills. The team speaks a combined eight languages, including English, French, Hebrew, Arabic, Italian, Spanish, Mandarin and Cantonese.
Attias, who is currently working with buyers from Saudi Arabia, Qatar, Mexico and China, said he expects the weakening U.S. dollar to mean the flow of international buyers in the city will continue in the coming months.
Nayi Shen and her new development team at Nest Seekers focuses primarily on buyers from Asia, namely China and some from Japan and South Korea, who often buy property for their children to attend school or start a new job.
To reach international clients, Shen and her 15-member team promote their listings and services on social media in multiple languages and use WeChat, Weibo and other platforms. Shen said she expects activity to pick up for her over the summer, as several clients have already lined up trips to the city.
While Shen works primarily with new developments in Queens, she said many of her clients express interest in projects they’ve seen in other social media posts, including developments in Midtown or Hudson Yards.
Some buyers come with specific buildings in mind after seeing advertising by developers, who often produce brochures in multiple languages and hire public relations companies to do overseas campaigns.
Philip Hordijk targets a wide swath of international buyers with his New York-based brokerage, Leven Real Estate. As founder and CEO, he launched a website in 25 languages and hired 15 agents of various nationalities, including six from Europe, six from Latin America and three from Asia.
For Leven, business in New York began picking up again this year, as interest in other U.S. cities has started to fade. Though international buyers were drawn to Miami in 2021 and 2022 because of a “real energy there,” many are setting their sights back on New York.
As the buzz around other towns begins to dim, Hordijk said international buyers are back to looking in the city’s areas they know and consider safe, like neighborhoods near Central Park.
Though international buyer activity is up for Leven this year, Hordijk said he’s also focused now on overseas clients who bought property between 2012 and 2016 and are now ready to sell. Unlike many domestic sellers, international property owners may be more willing to sell at or below the price they paid because of the exchange rate.
“Even if they’re taking a haircut, in their currency they feel they’re still winning,” Hordijk said.