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Investors Stay Sidelined Over Prospect of Rent Regulation Changes
Northern Manhattan was hit especially hard by multifamily investor caution during the first quarter, says Ariel Property Advisors. Transaction volume, the number of buildings sold, dollar volume and total apartment units were down by as much as 88% on both a quarter-over-quarter and year-over-year basis.
Propelling the decline, which affected other New York City markets to a lesser extent, was the prospect of dramatic changes to statewide rules governing rent regulation, now that Democrats have taken control of the New York State Senate. The current rules are set to expire on June 15.
“Investors understandably stayed sidelined in the first quarter since some of the proposals could have a big impact on the market, with certain properties more vulnerable than others,” said Shimon Shkury, president and founder of Ariel. “We expect the second quarter of this year to be slow as well, in anticipation of the new regulations.”
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