Understanding the dynamics of property renovations and the potential value they can bring is crucial for both buyers and sellers alike in today’s real estate market. Renovated properties continue to command a premium, influencing sale prices and market trends. Similarly, the presence of outdoor space has emerged as a significant factor, impacting the desirability and pricing of residential units. Let’s delve into the current renovation premium and the evolving importance of outdoor space, examining their implications on the New York City real estate landscape.


Renovation’s Impact on Property Value


Right now, it’s clear that buyers have a strong preference for renovated properties, and it’s affecting sale prices. Homes that need work are spending more time on the market, and sellers are often forced to accept steeper discounts. So, what’s the current market penalty for non-renovated units? Let’s break it down.

The chart below illustrates the percentage by which renovated units are selling above unrenovated ones. But beyond the current numbers, what’s truly crucial is the year-over-year trend.



Reflecting on the past, we saw a significant surge in the value of renovated units during the pandemic, peaking in 2022 at about 32%. Since then, however, we’ve observed a decline to the current rate of 18%. But don’t let that fool you; even with this dip, the value of renovated units in NYC remains higher than the entire span from 2014 to 2021. It seems the recent drop may simply be a correction after an unusual event.

While the drop appears to be stabilizing, one thing remains clear: buyers are still willing to pay significantly more for a turn-key property than they were a decade ago. This is despite the fact that the cost of some renovation materials has decreased over the last 2-3 years ago. The sentiment among buyers that renovations in a co-op or condo can be a hassle, coupled with the expense, seems to persist.

If you’re a buyer considering a renovation project, it could be worth discussing. There’s real value in unrenovated properties at the moment. Using our resources we can get you reliable information on the true cost of renovation from trusted contractors who can alleviate some of the general anxiety surrounding the process. This is where having great team around you can give you an edge over the competition.


Unlocking the Value of Outdoor Space


Another factor driving premium prices for apartments is outdoor space. This became increasingly important during 2020 and has since tapered off. Last year, apartments with outdoor space sold for 9% more than those without, and in 2024, that premium stands at 8%. While still historically high, this figure ties for the 3rd highest premium paid by buyers for outdoor space over the last 15 years. 



It’s important to note that these figures encompass all types of private outdoor space, without considering differences in value between, for example, a balcony and a private garden. Various factors contribute to pricing outdoor space in NYC, including type, size, utility, view, and proportion to the apartment’s indoor space. Generally, the price per square foot of private outdoor space ranges between 25%-50% of its interior price per square foot.

Navigating the intricacies of pricing properties with private outdoor space requires careful analysis. Whether you’re evaluating your own property or considering a purchase, we are here to help. Together we can walk step-by-step through the process and set you on the path to success.

As always, please email or call with any questions. We are happy to have a deeper discussion if real estate is on your mind.  Feel free to contact us anytime!

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