New York and the Pandemic: Irreversible Life and Real Estate Changes

7:38 am  |  29.03.2021

The state of New York on the east coast of the United States with the metropolis of the same name has become the epicenter of the coronavirus pandemic in the United States. City hospitals are currently lacking, in particular, staff and ventilators, and procurement is a race against time.

Corona Cases and Deaths Increase Every Day

The number of people infected and killed by the corona is increasing dramatically every day. According to Johns Hopkins University, over 160,000 people are infected with Covid-19 in New York City as of April 28, 4:10 pm, and 291,000 people in New York State. The death toll in New York is over 17,000.

In a poll published Monday by the Siena College Research Institute, 46 percent of those surveyed said they personally knew of the death. According to this, 60 percent of those surveyed know someone who has tested positive for the corona.

New York State Governor Andrew Cuomo has imposed strict travel restrictions and extended them until at least mid-May. According to a poll by the Siena College Research Institute, this has generated widespread support among the population: 87 percent of those polled support expansion, despite the severe economic impact.

New York State Plans a Slow Return to Normalcy

According to a survey, almost one in two New Yorkers knows someone who has died from a coronavirus infection.

The governor of the American state of New York has put forward a plan to return to normalcy. “We want to rebuild the economy,” said Andrew Cuomo. “But we have to proceed with caution and prudence.” For example, companies must ensure that distance rules are respected in their offices and factories and that there are sufficient respirators available for their employees.

However, in the metropolis of New York and other southern regions of the state, restrictions can be lifted only later, Cuomo said. The situation there is “more complicated” than in the north. All mitigation measures in New York must be coordinated with the neighboring states of New Jersey and Connecticut.

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Real Estate New York: Investing Time During and After the Corona

Investing in New York real estate is one of the most profitable purchases that can be made if you have the right hand at the right time.

The decisive points are without a doubt, on the one hand, the value of the location and the anticipated development of the location in which the property was built, because deterioration in the infrastructure could mean that the currently paying tenants could move out, and on the other hand, the property’s condition is unpredictable Risk if regular maintenance and repair work is essential for the property.

Manhattan is arguably one of the most valuable real estate locations in the world right now, so now is the right time for overseas investors to cut off an even bigger part of the Manhattan real estate market pie they already had. The situation in New York will soon recover, but the domestic purchasing power will not be able to give by far what it was able to bring in 2019.

The consequence will be reflected in the price reduction of the investment objects and foreign investors will know how to make good use of this. It is expected that domestic property purchases in New York will fall by at least 15% despite price stagnation.

Assuming that most of the people who can afford the horrific rents in Manhattan, for example, because they are a New York stockbroker or other business employees, are reluctant to take long journeys to their place of employment, the demand for apartments increases hardly weaken in Manhattan, even in times of crisis.

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If someone wants to invest in a New York property, e.g. buy an apartment as a capital investment, and despite several calculations back and forth, which has repeatedly lied to the result that the direct investment actually sounded not only promising from the beginning but also facts have spoken in favor of the successful implementation, the banks often find that if there is the slightest doubt about the risk assessment, despite the available facts and figures, the almost capital investor ultimately decides against this form of investment, although a lot for them Investing in a real estate investment and speaking.

But investing in New York real estate with little money is also possible. For example, if you only pay 20 percent down, you will receive the rent and thus the return directly.

If the financing does not work out at home, it is worth taking a look at the New York-based bank. These also grant foreign investors financing in which up to 80% of the loan value is made available.

If you invest in a property, earn money with rental income, and sell it after a minimum holding period of one year, you can sell the property at a profit without including a single cent of the sales revenue in income tax. The prerequisite for this, however, is that you have invested in another property no later than six months after the sale of the first property, which must be of at least the same value in terms of the price segment in accordance with the purchase price of the first. Many real estate investors know how to take advantage of these practices.

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The purchasing power has decreased, but the interest and, above all, the demand to rent Manhattan real estate will not decrease despite Corona.

The factors: purchasing power, inflation rate, and return are decisive for success if you want to invest in real estate, and New York is now and remains an interesting area for foreign investors who can double their investment within a few years.

A return is the percentage return on an investment that can be generated over the entire period of a year, for example through rental income, and represents the relationship and balance between payments and payments. In the case of the return on an investment in the form of an apartment building, the rental income that can be generated should be so high that it covers all costs as well as the interest and ideally leads to profit generation. As a rule, in most cases, the return is calculated as a percentage annual value.

The return is not necessarily identical to the interest rate on an investment. If, for example, one compares two overnight money accounts, one of which has an annual and one monthly interest credit, the latter leads to a higher return because the investor benefits from the compound interest effect. Of course, the term of the repayment also contributes to the yield.

The Best Form of Investment is Definitely: Real Estate As a Capital Investment

Because when you invest in real estate, you can also protect your money from losing a lot of value due to inflation. A property that costs many times the annual salary will still be worth about as much in the event of a price increase. However, you should definitely avoid having to sell the property during strong inflation, as the purchasing power of the proceeds is then naturally lower.

The advantages of an investment in real estate, for example, an apartment in Manhattan, are obvious and there is no better investment option because real estate prices are rising steadily.

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