The recent shift from flexible work-from-home policies to more stringent return-to-office (RTO) mandates by financial firms could affect New York City’s real estate market. Wall Street companies, which previously allowed hybrid work schedules, now require many employees to be in the office, up to five days a week.

Employees are responding to these changes by adjusting their housing plans. For instance, some opt to move back to the city full-time, while others maintain their suburban homes and acquire smaller apartments in Manhattan for convenience. Some ...