New York State Of Mind: An Expert’s View Of Manhattan’s Residential Real Estate Market
January 29, 2026 by Gwen Donovan
As one of New York City’s leading design and renovation authorities, Paula McDonald, managing director of Paula McDonald Design Build & Interiors, is known for skillfully transforming residential spaces, many of them in the heart of Manhattan. For over 20 years, this luxury firm has delivered distinctive service, starting with initial design concepts, building approvals and permits to construction through completion. She is proud of an award-winning history which seamlessly integrates architecture, design and creation. McDonald recently shared her thoughts about successfully navigating Manhattan’s real estate market by using decades of insider knowledge while helping her clients move forward confidently in any market.
Does your focus on residential projects give you a unique spot in the current market?
Yes, we address a specific niche. It makes a difference, and I believe this is why I’ve been able to continue offering my services through the ups and downs of the real estate market in Manhattan. The expertise for residential is extremely demanding, more expensive to deliver, and is not competitive for the pricing and costs compared to the budgets we see for hospitality and commercial spaces.
How would you describe today’s residential real estate market in New York City?
The market today in New York City is flat. The real estate market in Manhattan is significantly different economically from other boroughs in the New York Metro area; it has different market values and inventory that are not equal in comparison with the zip code. My business is a niche, and geo-targeted locally in New York City because of the expertise it takes to renovate within the building regulations set by the City, the types of buildings (condo vs co-op vs townhome), the age of the structures, and existing infrastructure. It’s more complex and expensive to renovate here in Manhattan (and specifically below 120th Street) than anywhere else in the New York Metro area.
What is housing availability like in New York City?
There is relatively very little inventory in the price points of apartments that need complete renovations. And many buyers are reluctant to renovate, given the history of negative experiences with a complex project. That’s why my business model perfectly serves the needs of clients who want to renovate, offering years of expertise, an excellent track record and a virtual portfolio on my website. My presence on YouTube and social media speaks volumes about how to get this done in New York City.
What do your clients say about their experience when collaborating with you?
The biggest compliment any client can give us is evident by their references and their repeat business. Referrals represent the majority of my projects in any given year. I continually hear that the completed project is more than they imagined, and they are amazed, love it, and many become friends. That means the world to me, because I approach their project as if it were my own. I think of every possible detail we need to define or address, then we deliver the most perfectly completed renovation we can!