If you live in a bigger city such as New York City then it’s likely you’ve heard of someone boasting about their pied-à-terre. While the term itself may make you think of a delicious baguette (a legit thought the author first had when she heard this term), a pied-à-terre is actually a French term that literally means “foot to the ground” and is used to refer to a residential unit located in a large city some distance away from an individual’s primary residence. A pied-à-terre is not a legal definition of a class of apartment and can have a very subjective definition depending on whom the owner is. For example, you’ll find pieds-à-terre in a wide range of pricing, bedroom sizes, and locations, from extremely expensive penthouses right by Central Park to one bedrooms that are more affordable in the East Village. You’ll also find them various types of ownership arrangement buildings such as condos, condops, or even coops (we’ll get into further detail later about why this is not as common).
It’s important to understand that pieds-à-terre are a secondary residence and not necessarily just a vacation home. This distinction comes from the fact that pieds-à-terre can be used for part of the year or even part of a work week depending on its owner. For example, although it’s true that most pieds-à-terre can only be afforded by relatively wealthy people, there are plenty of others who may also benefit from owning one. From retirees who want to visit family in another city on a regular basis to business travelers who have to constantly travel back and forth for work purposes.
Due to this, even though pieds-à-terre can be smaller than a typical vacation home, it is always usually still considered a more comfortable alternative to a hotel room and can cost less in the long run (as it allows the owner to save on hotel costs that rack up and make possible profit from renting the unit out when they’re not there). In fact, many pieds-à-terre comes with perks that rival hotels themselves, such as concierge services, spa & fitness centers, resident lounges, and rooftop bars. The fact that a pied-à-terre is a secondary home, also means that their owners can travel lightly with as little as just a purse or suitcase.
Now that you’re more aware of the benefits of a pied-à-terre, we’ll delve into where you can find these elusive listings. While most pieds-à-terre can be found in larger cities such as London, Hong Kong, Singapore and New York, even within each city, there are particular neighborhoods that stand out more to those interested in purchasing a pied-à-terre. For example, primary neighborhoods in Manhattan that attract interested pied-à-terre buyers include the Upper East Side, Central Park, Soho and Midtown. With the development of Brooklyn, there are even more and more listings that allow pied-à-terre that we’ve seen more of an influx in those neighborhoods as well.
As mentioned previously, while most pieds-à-terre can be located in condos, it is much harder to find one in a co-op building because most co-op boards want the apartment to be a primary residence. Some co-op boards will completely rule out pieds-à-terre whereas others may allow them on a case by case basis. Even then, many high-end condos and co-ops will have many rules in place that would make it harder for one to rent out their pied-à-terre as they please. For example, they may limit short term rentals or force the owner to live in the apartment for two to three years before they are allowed to rent it out. Other than the difficulty in finding a pied-à-terre, it is also important to consider the finances necessary to purchase one. Buying a second home often entails different tax rules and requirements for the mortgage. For example, the buyer may need an even higher credit score and/or a larger down payment in order to qualify for a second mortgage.
Unfortunately, with the rising popularity of pieds-à-terre, there’s also been a rise of vacancy rates. A City & State article from August 2017, states that “there are 54,764 apartments in New York City that are vacant, according to the 2014 Housing and Vacancy Survey – but not really. These are apartments used for “seasonal, occasional, or recreational use” – i.e., pieds-à-terre or second homes”. So while the existence of pieds-à-terre can be beneficial to the local economy, at the same time, they can take off perfectly available units and cause a rise in demand for housing which can lead to higher housing costs for people who live in the city full-time. Due to this issue, some have begun proposing a pied-à-terre taxes which would effectively raise property taxes on pieds-à-terre, in hopes of getting more apartments back on the market to raise housing supply, leading to less demand and lower housing costs for all. Because of this, it is always important to check with your buyer’s agent regarding local laws and building regulations for pieds-à-terre before proceeding with your purchase.