Today’s luxury New York condominiums may become tomorrow’s rental apartments as for-sale units pile up in a market with fewer buyers, billionaire real estate investor Richard LeFrak said.
The added supply of listings for lease will limit rent growth, LeFrak said in a Bloomberg Television interview Monday.
“New York rents are probably going to flatten out now, and you’re probably going to see some of the condominium inventory turn into rental inventory,” he said on the “Bloomberg <GO>” program.
Apartments for rent should remain a strong business in New York, even as luxury condos suffer from oversupply, he said. About 5,126 newly built condos are scheduled to be added to the sales market, the most since 2007, according to data from Corcoran Sunshine Marketing Group. Sales have already been slowing for the most-expensive homes, products of a four-year construction boom aimed multimillionaire buyers.
“I’d be a little concerned if I were selling high-end condos,” LeFrak said in the interview. “The upper end is probably getting adequate service,” he said. “But the middle and the affordable certainly could use all the help.”