COVID has left its mark on New York. Even as the pandemic seems to recede, its effects will be felt for a long time.
This year, the market is set to contract again as return-to-office plans are finally enacted after months in limbo. This is expected to cut demand for the residential sector by almost 20%, while the pandemic’s effect on commerce, infrastructure, and healthcare are expected to keep those sectors suppressed as well. Work-from-home policies in New York mean that the pandemic’s burden has been felt disproportionately by low-wage earners who cannot be remote. This will likely have different economic consequences from other cities, although it is too early to say exactly what they will be.
The New York market is set to see a weak but consistent decline each year going forward. Construction employment decreased in 2021 in a departure from trends in other markets. This will further complicate the recovery and will keep costs up even as demand wanes. America’s economic center has undeniably shifted towards California, taking skilled workers with it. As population growth slows, so will demand for new construction. The market will likely shift to renovations rather than new developments, similar to those along the Great Lakes. Until then, there is plenty to do.