02/27/2026
2025 marked a turning point in the Manhattan apartment market, with sales briefly reaching their highest level since 2022. Demand strengthened, particularly after the presidential election, supported by a third consecutive year of double-digit stock market returns. NYC’s economy performed well through the first three quarters of the year, with employment hitting a record 4.261 million in August, outperforming the national economy and expected to continue doing so in 2026. One of the most positive developments was the decline in mortgage rates in the second half of the year, with 30-year rates now around 6.2% and projected to move lower in 2026.
Despite ongoing concerns about the U.S. labor market and uncertainty surrounding a federal government shutdown and the NYC mayoral election, unemployment remained low. However, these factors contributed to a slowdown in fourth-quarter activity, with closings down 9% year-over-year.
Prices remained largely flat, with the average resale apartment price at $1,768,953. Manhattan’s relatively healthy inventory has kept prices from rising too quickly. While the market remains buyer-friendly, it has increasingly become an investor’s market, as prices soften and rents continue to rise. With rates trending lower, we expect a very active Manhattan market in 2026.
As an example, the Filipacchi Foussard Team introduced 56 Crosby Street in March 2025. The price has since been reduced by $2,000,000 to $6,850,000 ($1,895/SF). The apartment also generated rental offers up to $32,000 per month, implying a ~4.3% cap rate at the current asking price. Notably, sales comps from just one year ago in the same building support a value of $2,393/SF for a nearly identical unit one floor above.
56 Crosby Street
https://www.bhsusa.com/for-sale/manhattan/new-york-city/soho/56-crosby-street-3r-new-york-city-ny-10012/RLS20061852-3056734
Looking ahead, new development leasing activity in Downtown Brooklyn, particularly along the Fort Greene border, may impact the downtown Manhattan rental market in 2026. Over 2,700 new rental units delivered in late 2025 are attracting renters seeking more space, though many Manhattan renters are choosing to stay put due to limited alternatives and the continued appeal of Manhattan living.
At Filipacchi Foussard, we believe 2026 will be a challenging year to predict, but one that presents rare opportunities for investors to acquire prime properties at compelling prices and cap rates.
Below is a link to the full BHS Q4 2025 Market Report presented by Bess Freeman, CEO of Brown Harris Stevens.
https://bhs-content.ion3.io/2026/01/Manhattan_4Q25_MR.pdf
