City v Suburbs

David Goldsmith

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There are going to be those like myself who always have had an attraction for it. But I spent my teens going through neighborhoods in NYC that I think most newcomers/millenials/whatever can't even comprehend. I think we are seeing a rise in crime which will help chase many who thought being a gentrifier was "cool" or "edgy" out of marginal areas, especially if their typical comforting retail icons don't bounce back so quickly. What's the advantage of living in a big city? I think a lot of the things those who moved to big cities were chasing might not be there as much post-COVID, especially as you say if it's no longer necessary to get certain kinds of jobs.

But also for those who are going to stay I think they clearly are going to need larger apartments, but at least in NYC the apartments being built (except for the very high end) have gotten smaller. And since I see people taking home the same or less money than before, I think they are going to need those larger apartments for the same or less money. If they can't get that, I think it will push them to move to where they can.
 

John Walkup

Talking Manhattan on UrbanDigs.com
Many firms, including FB, will make comp in-line with location, meaning WFH won't be a free option. That will be a tricky choice for many since it's easier to get out than it is to get back in. Will hurt the burbs most. Winners will be exurbs, but due to worker dispersion, no locales will see real influxes so none will really "win".
 

John Walkup

Talking Manhattan on UrbanDigs.com
Agree with increased demand for larger places. Possible to see a value trickle-down if, after years of declines, prices for larger/luxury units hold steady? Unfortunately, (putting aside retail and crime) more middle-class parents view the school system as oppositional... and the center needs to hold for any recovery.
 

David Goldsmith

All Powerful Moderator
Staff member
One rule of thumb I've used for many years has been "Can a family with 2 working parents afford a 3 BR apartment in a decent neighborhood?"

With WFH I think that changes to at least a 4 BR. Not so sure in post COVID-19 New York that's viable at current numbers.
 

John Walkup

Talking Manhattan on UrbanDigs.com
Interesting - I'd be curious to see how the price of 3beds tracks income and population across nhoods
 

John Walkup

Talking Manhattan on UrbanDigs.com
Thanks David - another interesting, albeit anecdotal piece. We started pulling some numbers for the burbs and found that *actual* demand (as measured by deals) is up by about 20% in most areas. Some places are seeing +50% bumps. Meanwhile, Manhattan remains in lockdown with demand artificially curtailed so no way to really know what the true delta between city and burbs, but if there is a real estate physics law 'Demand Cannot Be Created Or Destroyed' it would imply that if burbs demand is up 20%, Manhattan demand is down 20%.
 

David Goldsmith

All Powerful Moderator
Staff member

Zillow survey forecasts suburban boom as remote workers flee pricey cities in search of bigger homes

The Seattle real estate tech companies that have spent the past several years reporting on how attractive and hot tech hubs like Seattle, Silicon Valley and elsewhere are have shifted gears during the COVID-19 pandemic. The darlings of the latest real estate projections are secondary cities, the exurbs, bigger homes and more space.
Zillow weighed in this week with the results of a survey tied to remote work and how it could affect where Americans want to live, with 75 percent of those working from home saying they would like to continue to do that at least half the time after the health crisis subsides.
That work-from-home desire also leads two-thirds of employees (66 percent) who have that option to say that they are at least somewhat likely to consider moving as a result. It’s a shift from the past decade that has drawn more people closer to urban cores and tech jobs — and spurred an explosion in home value growth and an affordability crisis in places like Seattle.

Zillow’s take is in line with comments made recently by Glenn Kelman, CEO of Redfin, who predicted on an earnings call that remote work could lead more people to leave cities like New York, Boston, San Francisco and Seattle in search of cheaper real estate and more space. He called out smaller cities such as Boise, Idaho, Bozeman, Mont., and Tacoma, Wash., which could see an influx of home buyers.
Redfin further reported on this trend on Thursday with data showing that page views for houses in small towns (populations less than 50,000) were up 105 percent year over year during the seven-day period ending May 1. The views climbed 76 percent for rural counties with fewer than 10,000 people — down from a peak of 170 percent a month earlier.
Redfin also said the draw to small towns extends beyond browsing to actual sales. While pending home sales are down across the board, less-populous areas aren’t being hit quite as hard as large cities.

Glenn Kelman@glennkelman

https://twitter.com/glennkelman/status/1260981794087645185
Replying to @glennkelman

4 of 7: Boise @Redfin agent Kristin Lopez said, “90% of my clients are coming from California, Seattle or Portland. People were thinking about relocating or talking about relocating before the pandemic, but COVID was the straw that broke the camel’s back.”

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Glenn Kelman@glennkelman

https://twitter.com/glennkelman/status/1260982370749911041
Replying to @glennkelman

6 of 7: What's changing isn't just where people live, but what they want. Florida @Redfin manager MaryDell Penney said, “Pre-COVID, people wanted beautiful open floor plans. After months in quarantine, buyers want quiet spaces to get away from everyone else, for school and work.”

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On the heels of Twitter announcing that some employees will be allowed to work from home forever, Bloomberg also reported Thursday on how Silicon Valley tech workers are looking to escape sky-high rents for more affordable options away from San Francisco.

Zillow found that people aren’t just looking to take advantage of the ability to do their job from anywhere, they want to be more comfortable while doing it. Of those surveyed with WFH as an option, 31 percent would consider moving in order to live in a home with a dedicated office space, to live in a larger home (30 percent), and to live in a home with more rooms (29 percent).
“Moving away from the central core has traditionally offered affordability at the cost of your time and gas money. Relaxing those costs by working remotely could mean more households choose those larger homes farther out, easing price pressure on urban and inner suburban areas,” Zillow senior principal economist Skylar Olsen said.
The trade-off is moving away from a wider variety of restaurants, shops, and urban amenities. Olsen said “we’re not talking about the rise of the rural homesteader on a large scale,” but rather a remote workforce that still favors suburban communities or secondary cities that have many of the amenities plus the bigger homes.
For those who work from home some of the time and still make a trip into the office, breaking up the routine can change what they’re willing to put up with when it comes to a commute.

Previous Zillow research found renters, buyers and sellers overwhelmingly agreed that the longest one-way commute they’d be willing to accept when considering a new home or job was 30 minutes. The new survey showed 50 percent who would be open to a commute that was up to 45 minutes or longer.
 

David Goldsmith

All Powerful Moderator
Staff member
Tri-State brokers are busier than ever as buyers warm to suburban living
As pandemic upended priorities, sellers markets have emerged in Fairfield, Conn.; Irvington and Rye, NY; and the Hamptons

The coronavirus has dramatically reshaped the luxury real estate market in the Tri-State area, and while the pandemic upended much of the economy, industry veterans say they’ve never been as busy as they are now.
While the early days of the crisis were marked by a mad rush for a limited supply of rental properties on Long Island and Upstate, transplants from New York City are starting to warm to the idea of staying in the suburbs for the long haul, brokers said Wednesday during the latest installment of TRD Talks.

“One of the really interesting things is that people are doing the opposite of what they usually do,” said Deirdre O’Connell, CEO of Daniel Gale Sotheby’s International Realty on Long Island.
“They’re buying in the secondary home market for their primary residence, and they’re rethinking Manhattan as their second place to live,” she said, noting that some buyers no longer expect to be in their Manhattan offices five days a week even after reopening.

O’Connell was joined by Compass’ Heather Harrison, who covers Westchester County; and Paul Breunich, president and CEO of William Pitt – Julia B. Fee Sotheby’s International Realty in Connecticut. The three spoke with The Real Deal managing web editor James Kleimann.

“Overnight it went from a buyers market to a sellers market, and also overnight it went from people migrating to the city to people escaping to the suburbs,” said Breunich, adding that many buyers no longer expect the New York City school system to open up on time in the fall.

Given New York’s massive population, “just a very small percentage of them have to move and it’s going to flood our markets, and that’s what’s happening now,” he said. “That’s why I think there’s permanence in this whole movement.”

While young families moving out of New York City have always been a mainstay of the Tri-State real estate business, the pandemic appears to be pushing some to move even earlier than usual.
“One of the trends we are seeing is families with no children moving to the suburbs,” Harrison said. “Newly married, not pregnant yet, and some not even married, moving and buying homes in the suburbs.”

At the same time, the archetypal sellers in these markets — empty-nesters looking to downsize to a Manhattan apartment or a Florida home — are also staying put more. This has even led to sellers cancelling contracts, paying a premium just to not move.

“So many of my potential sellers … have now decided that they’ve enjoyed quarantine in their home, and are very glad that they didn’t move and didn’t downsize to an apartment necessarily, and now those people have decided not to put their homes on the market,” Harrison said.

Even as New York and the suburbs have begun to gradually reopen from months of lockdown, some practices adopted in the Covid era might be here to stay — like virtual tours.
“I don’t think it’s going away,” O’Connell said. “Yes, we can do in-house showings now and that’s great, but I think it’s a lot more effective if someone can virtually tour a property before coming and physically touring a property.” She added it was “less intrusive for the homeowner who doesn’t have their home exposed to people that potentially are tire-kicking or just trying to figure out where they are in their journey of purchasing a home.”

Meanwhile, issues that had hampered the Tri-State resi market prior to the pandemic, like the new federal cap on state and local tax — aka SALT — deductions, may now be in the rearview mirror.
“I think now more than ever, it’s not as big an issue as it was,” said O’Connell, arguing that the market has largely digested the impact of the new rules. “If you want to live here, it is what it is.”

The panelists noted that the wave of new interest in their markets have touched submarkets across the board, as commutability to Manhattan has become less of a factor and the supply-and-demand dynamic has forced buyers to be less selective.

“When you have a lot of demand there and there’s multiple people that are going after it, that’s pure capitalism,” Breunich said. “And that’s why it’s such a good industry to be in, because nobody sets the market except the people.” The buyers, he said, are “coming in with cash. They want to move in in three to four weeks and they’re going for the mortgage afterwards. There’s a middle-to-upper crust of the population, in my opinion, that’s doing this.”
 

David Goldsmith

All Powerful Moderator
Staff member
Marcus & Millichap CEO predicts “exodus” from cities to last two years
Hessam Nadji said pandemic has accelerated millennials’ movement to suburbs

New York City is reopening, but Marcus & Millichap’s CEO is not predicting a return to form anytime soon.
Hessam Nadji told CNBC in an interview this week that demand was surging in suburban areas as people fled cities, a trend he predicted would continue for up to two years.

“I think the next 18 to 24 months are going to show a lot of exodus out of central business districts,” he said.

“We’re seeing there’s a lot of office vacancy, for example, in the suburbs that have now been absorbed,” he said. “There’s a lot of demand for rental homes that we’re seeing because people are fleeing especially hot spots like New York.”

Nadji said a growing number of millennials were already looking to the suburbs before the pandemic, but the health crisis had accelerated that pattern.
“It was a trend that was starting to happen already over the last two or three years. You have to remember that 60 percent of millennials are now in their 30s,” he said.

Some of the main areas where people are migrating from include New York City, Seattle and Miami, according to CNBC.
Despite his predictions about the short-term health of cities, Nadji said he was confident that busy areas would regain their appeal.

“I just don’t think we should count out the long-term prospects of the benefits of central business districts,” he said.
 

David Goldsmith

All Powerful Moderator
Staff member
New Yorkers reckon with the suburbs. And agents rejoice
Sales surge as city residents flee to the tri-state

Most know it as “Greenwich.” But to Danielle Malloy, it’s become “Manhattan North.”
The managing broker for Nest Seekers International in Connecticut has seen so many families moving into the area, first as renters, then buying secondary homes, then moving into primary residences, that it’s transforming the market.
“It was surprising to everyone,” Malloy said. “Now every broker I know, we’re busier than ever right now.”

As the pandemic continues, New Yorkers who fled the city are coming to a new realization: maybe they actually like the suburbs after all.
And it’s not just Connecticut. Across the tri-state area, short-term renters are becoming long-term buyers as residents are allowed to work from home and families seek private amenities to ride out waves of the coronavirus pandemic.

Long Island
At the beginning of the pandemic, real estate agents were forced to scramble. As offices closed and buyers and sellers stood in the face of uncertainty, sales plummeted.
For Signature Premier Properties, which does business in Nassau and Suffolk counties, the number of homes under contract in April dropped nearly 66 percent year-over-year. The number of homes sold similarly decreased 33 percent compared to the year before. And May was even worse, at a 50 percent decrease in contracts.

“It’s still an industry where you have to see it, feel it, touch it,” said Kathy Viard, the co-owner of Signature Premier Properties. “In the beginning of Covid, when we didn’t really know what was going on, everything was virtual.”
But when Long Island entered Phase II in mid-June, allowing for in-person showings, everything changed. Homes under contract jumped 15 percent compared to last year. So did the average under contract price, increasing almost 15 percent to $683,492.

June was the best single month of Signature Premier Properties’ 12 years in business.
“June and July are going to be record months, and then we’ll know for sure whether most of this is pent up demand or an influx from the city and the boroughs,” said Peter Morris, co-owner of Signature Premier Properties.

Connecticut
No real estate market in the U.S. was battered more by the Great Recession than Connecticut.
By the end of 2019, most home values in the state were down 20 percent from the pre-Recession peak, according to Zillow. At the beginning of the year, Connecticut had only recovered about 85 percent of the 120,000 jobs it lost during the last recession.

Nonetheless, 2020 started off strong. Sales of single-family homes were up 6.1 percent in January and February, and the median price was up 8.7 percent, according to the Warren Group.
Though the early stages of the pandemic caused a drop in closings, there was an immediate increase in rentals, according to Susan Cassidy, the branch vice president of Coldwell Banker’s Greenwich offices.

Cassidy said buyers from the city were especially interested in backcountry properties, which had been languishing in recent years. Nearly a third of homes that went under contract between March and early July had a pool, she said. And nearly 10 percent had three or more acres.

“The buyer six months ago did not want to deal with maintaining anything more than they absolutely had to,” Cassidy said. “But if they’re moving further away because they don’t need to commute into the city anymore, then they need a place to work at home. So, they need a designated space, they need more space. And if they’re going to be in it all day, every day, they want more amenities.”

The increased activity has dwindled the inventory throughout the tristate region and turned it into a sellers market. Active listings in Fairfield county have dropped from 5,871 in June 2019 to 3,806 in 2020 – a 35 percent difference over last year. Counties in New Jersey and Long Island are similarly seeing inventory drops in the 30 percent range, according to a data analysis by The Real Deal.

“It is definitely a vicious cycle because what happens is someone wants to put their house on the market, but they’re afraid they won’t find anything. So then they don’t put their house on the market,” Cassidy said.
The number of single family homes sold between January and July 10 increased 5 percent, while those under contract increased 11 percent, according to MLS data shared by Malloy. The average sale price similarly has gone up 10 percent as families invest in larger homes and bidding wars push the price up, the data shows.

“I’ve been through the amazing times of 2005 and 2006 when we were doing offers on the back of the car and we were in bidding wars, and then, all of a sudden, the market crashed and you weren’t seeing those things anymore,” Malloy said. “I didn’t think we were going to see these times again or anytime soon.”

Westchester
Westchester agents don’t argue that not being able to show houses, while agents in the neighboring county were deemed essential businesses, hurt.
The latest Douglas Elliman report on the second quarter shows that the number of sales closed in Westchester plummeted 27 percent compared to last year. Putnam and Dutchess counties only saw a slight decline of approximately 4 percent.

In statements, Douglas Elliman president and COO Scott Durkin blamed shelter-in-place orders preventing showings as well as a steep drop in inventory.
In Westchester County, inventory declined almost 23 percent and in Putnam and Dutchess counties, the decline was nearly 21 percent.

But Gino Bello, a top broker for Houlihan Lawrence in Westchester, said that inquiries have increased, mainly in June after shelter-in-place was lifted.
Searches for single family homes increased 61 percent year-over-year in June, with residents prioritizing decks, fenced-in yards, gardens and water access in their hunt for a new home, according to Bello.

Bello expects a highly active market over the next few months, but fears that the upcoming presidential election as well as a resurgence in coronavirus cases could stifle that growth.
New Jersey
Sonja Cullaro, an agent with Christie’s International Real Estate Northern New Jersey, said the market has been re-energized by the pandemic.

Although contract signings were down in both May and June, likely a reflection of the lockdown in March and April, there are signs of a rebound. Single family homes under contract during mid-to-late June increased 46 percent compared to last year, according to NJMLS.

The luxury market – defined as properties over $1 million – saw the greatest boost in sold listings, which were up 11 percent year-over-year, according to the data pulled by Cullaro.
Even for buyers who were investing in a secondary home, the considerations have changed.

“We’re seeing a lot of buyers looking for secondary homes, but they’re looking at school systems when they’re looking at these secondary homes,” Cullaro said. “So I think they’re mindful that their secondary home may become their primary home.”
 

David Goldsmith

All Powerful Moderator
Staff member
The future according to Blackstone: “Less density and a lot less new construction”
World’s largest commercial landlord reported strong Q2 earnings but company president Jon Gray pointed to challenging years ahead for cities

Blackstone Group, the world’s largest commercial landlord, has some sobering news.
“Over time people will return to office buildings,” said its president, Jon Gray. But, he added, “there will be less density, there will certainly be a lot less new construction.”
Gray spoke during the company’s second quarter earnings call Thursday, and reiterated what most Americans have realized over the last six months — the road to economic recovery, especially for cities, will be a long one.
“In urban markets in the U.S., this will be a challenging couple-year period,” he said. Among the hurdles, he pointed to high levels of unemployment brought on by the coronavirus, the transition to remote working and many companies’ hesitation to long-term commitments.

But during the call, the investment giant’s executives again argued that its $156 billion in dry powder will allow it to weather a prolonged financial disruption. Opportunities, however, may come further down the line than some had projected.
In identifying good investments, Gray emphasized the importance of separating cyclically impaired assets — like offices and hotels, which he predicted will bounce back when the economy does — from those with more fundamental problems, such as retail.


While Gray stressed that Blackstone is holding out to see what opportunities remain, the company still deployed about $5.9 billion of capital to real estate from April through June.

Blackstone was also active in real estate investment deals overseas. It invested in a student housing portfolio in England, a residential portfolio in Japan and took a minority stake in a public Australian casino operator, according to its earnings release. And in a deal with Hudson Pacific Properties, it committed $650 million in the quarter to invest in a production studio and Class A office portfolio in Hollywood. The deal would build out HPP’s extensive studio and sound stage portfolio.


World’s largest commercial landlord reported strong Q2 earnings but company president Jon Gray pointed to challenging years ahead for cities

Blackstone Group, the world’s largest commercial landlord, has some sobering news.
“Over time people will return to office buildings,” said its president, Jon Gray. But, he added, “there will be less density, there will certainly be a lot less new construction.”
Gray spoke during the company’s second quarter earnings call Thursday, and reiterated what most Americans have realized over the last six months — the road to economic recovery, especially for cities, will be a long one.
“In urban markets in the U.S., this will be a challenging couple-year period,” he said. Among the hurdles, he pointed to high levels of unemployment brought on by the coronavirus, the transition to remote working and many companies’ hesitation to long-term commitments.

But during the call, the investment giant’s executives again argued that its $156 billion in dry powder will allow it to weather a prolonged financial disruption. Opportunities, however, may come further down the line than some had projected.
For the quarter, Blackstone saw a boost in profits. It recorded net income of $568 million compared to $305.8 million year-over-year. The firm’s total assets under management increased to $564.3 billion, up 3 percent over the same period in 2019.

Rent collection mixed
Blackstone said rent collections from multifamily apartments and logistics centers held at about 95 percent of normal levels, but not surprisingly, retail properties took a beating. Collections for retail assets were at 50 to 60 percent of usual levels for the quarter. Office collections, meanwhile, stood somewhere in between, Gray said.

In recent years, Blackstone has been criticized for investment strategies that contributed to the gap between rich and poor. Calls for additional taxes on the wealthy have grown since the start of the pandemic, as cities and states grapple with severe budget shortfalls.

On Tuesday, presumptive Democratic presidential nominee Joe Biden proposed eliminating 1031 “like-kind” exchanges for real estate investors with annual incomes greater than $400,000. It was part of his plan to finance $775 billion in government spending over the next 10 years on child care and care for the elderly.

During the call, Gray said “higher taxes seem like an increasing likelihood,” while company CEO Stephen Schwarzman estimated that fiscal aid from the U.S. government, which now accounts for 15 percent of Gross Domestic Product, will likely exceed 20 percent due to additional legislation the firm expects this summer. Late last month, he maintained his confidence in a V-shaped U.S. recovery. But he added the upward climb would take “quite a while” before it matched 2019 levels.
 

David Goldsmith

All Powerful Moderator
Staff member
NYC’s cabbie workforce down 75 percent amid COVID-19 — but Uber, Lyft on upswing

The coronavirus pandemic has demolished New York City’s for-hire vehicle workforce, newly released city data shows.
The number of working drivers stood at 30,675 in June, the Taxi and Limousine Commission said Wednesday — a 75 percent drop from the 108,880 who drove for-hire vehicles in March.
For-hire trips dropped as much as 84 percent in March and April amid the depths of the outbreak, according to the TLC’s stats.

Trip have rebound some what since then — though app-based services like Lyft and Uber are recovering faster than taxis.
June saw 251,696 trips by per day for “high volume for-hire services,” a category that include app-based companies, compared to 750,000 daily trips in February, according to the TLC.
Yellow and green taxis, meanwhile, saw 20,428 trips per day in June compared to more than 200,000 in February.

The Uber drivers who remain are also earning more than their taxi counterparts: The average app-based driver took home $1,160 per week in June, $262 more than the average hack, the TLC said.
The data matches up with trends observed on New York City’s subways, where ridership has rebounded somewhat since falling by over 90 percent compared to pre-pandemic levels.

Taxi industry analyst Bruce Schaller, a former city transportation official, said the numbers are consistent with longstanding trends.
Schaller said taxi drivers are more likely to be out because they have to make loan payments on their TLC-issued medallions.
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“It’s kind of like schools. Everyone got hit, but the people suffering the worst before suffered the most here,” he said.
New York Taxi Workers Alliance Executive Director Bhairavi Desai conceded “owner-drivers” may have been more likely to keep working through the crisis.
But Desai said the pandemic was a “wake-up call” for drivers, many of whom are older and plagued by hundreds of thousands of dollars of medallion debt.
 

David Goldsmith

All Powerful Moderator
Staff member

Since the start of the pandemic, a growing number of Americans are rethinking where they want to call home and searching for places where they can find more outdoor space and room for home offices, according to new research from Redfin.
Redfin reports that 27.4% of its online visitors were looking to move to another metro in the second quarter of 2020—an all-time high, up from 25.2% in the second quarter of 2019. Redfin’s migration analysis reflects a sample of more than 1 million Redfin.com users who searched for homes across 87 metros in the second quarter.
“The factors driving a surge in overall homebuyer demand—low mortgage rates and changes in what people are looking for in a home—are lighting a fire in people who were already considering a move to a different area,” says Taylor Marr, Redfin’s chief economist. “Add in employers’ increasingly flexible remote work policies and the fact residents of many big coastal cities can’t fully enjoy their local amenities, and the people who have long wanted to live in a more affordable area or closer to family are incentivized to make the move soon. As we enter the second half of the year, I expect more people to move from one part of the country to another as the pandemic continues to influence people’s priorities and lifestyles. But it’s also important to note that some pandemic-driven moves are temporary, and the stories about families hiding out in remote cabins won’t all result in home purchases or permanent relocation.”
The most popular relocation destinations among Redfin.com users were inland areas that tend to boast higher housing affordability than coastal regions. The areas with the largest net inflows of Redfin.com users in the second quarter were:
  • Phoenix
  • Sacramento, Calif.
  • Las Vegas
  • Austin, Texas
  • Atlanta
Residents from New York, San Francisco, and Los Angeles are driving homebuyer interest in some of these destinations, Redfin’s report notes. (A net inflow means that more people are looking to move into than out of an area. On the other hand, a net outflow means more people are looking to leave than move in.)
“There’s an influx of people moving into Phoenix,” says Thomas Wiederstein, a local real estate agent. “They’re coming from areas like California, Texas, Washington, Chicago, and plenty from the East Coast. The cost of living here is a huge driver, but weather also plays a big role, with many looking to avoid those cold winters. With the pandemic, there are a ton of out-of-towners planning to work remotely who’d like a big backyard and office space, which didn’t used to be so high on their priority lists.” Wiederstein says buyers may be drawn to the fact that they can snag those items on their wish lists in Phoenix for around $400,000.

Out of town chart





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David Goldsmith

All Powerful Moderator
Staff member

The Coronavirus Housing Boom

You might assume that in the middle of a pandemic, when businesses are closing, and one in five Americans of working age are now unemployed, and everyone's staying at home...that the one market that would be in complete decline would be housing.
Well, it turns out that the housing market is in the rudest of health. Traffic on the real estate website Redfin is up about 40 percent, and the National Association of Realtors announced that pending home sales are up 15 percent from last month.
People are moving. Well, some people are moving. People who don't have to be tied to big urban areas are migrating to towns, rural areas and small cities. They're being driven by conditions related to coronavirus, and the understanding that the way we work — or that some of us work — has fundamentally changed.
Today on the Indicator, the coronavirus housing boom. What it says about the state of the economy, our state of mind and the widening gap between those workers who can do their jobs from anywhere — and those who can't.
 

David Goldsmith

All Powerful Moderator
Staff member

Cuomo begs rich New Yorkers to leave Hamptons, return to NYC: ‘Come over, I’ll cook!’

who are now in their Hampton's house, who also lived here.
Cuomo begs rich New Yorkers to leave Hamptons, return to NYC: ‘Come over, I’ll cook!’
Gov. Andrew Cuomo has been begging rich people to return to New York City from their second-home retreats so they can pay taxes to help offset the state’s growing coronavirus-related revenue shortfall.
“I literally talk to people all day long who are now in their Hamptons house who also lived here, or in their Hudson Valley house, or in their Connecticut weekend house, and I say, ‘You got to come back! We’ll go to dinner! I’ll buy you a drink! Come over, I’ll cook!’” the Democratic governor said Monday.
“They’re not coming back right now. And you know what else they’re thinking? ‘If I stay there, I’ll pay a lower income tax,’ because they don’t pay the New York City surcharge,” he added, noting the wealthiest 1 percent of the Empire State’s population picks up roughly 50 percent of the state’s tax burden.

The plea comes amid dimming hopes that the federal government’s next COVID-19 relief package will contain any additional aid for struggling state and local governments.
If additional dollars don’t come to New York on top of waning revenue streams, Cuomo and other state officials have said the hit could translate to 20 percent cuts to health, education and local governments’ annual budget.
Meanwhile, Cuomo has said he’s not keen on raising taxes for the wealthy, adding it wouldn’t be enough to cover the state’s growing deficit — pegged at around $30 billion over the next two years.
But he’s at odds with leaders in the state Legislature — particularly state Senate Majority Leader Andrea Stewart-Cousins (D-Westchester) and Assembly Speaker Carl Heastie (D-The Bronx), who last week diverged from Cuomo, arguing that raising taxes on New York’s wealthiest is something they would consider and support.

The Democrat-run Legislature has been working on an alternative fiscal package over the last several weeks, in case Washington doesn’t come through.
“They have to deliver. We have federal representatives, we have senators and we have congresspeople. We pay them to pass a piece of legislation that’s going to help New York. And it’s simple, if the federal legislature is not going to help New York, you know what I say to them? ‘Don’t pass it! It can’t pass without you! Don’t pass a piece of legislation that doesn’t restore New York’s funds,’” the third-term Democrat continued Monday in a pointed jab at New York’s federal delegation.

“If you pass a piece of legislation that requires New York to raise taxes, raise a millionaires’ tax in this environment in New York City, where we’re struggling … We used to be worried [with a] millionaires’ tax, people might leave,” he continued.
“No. The burden shifted. We’re trying to get people to come back. We’re trying to get them to come back. Covid’s under control.”
“We’re going to make progress helping the homeless. We’re going to clean up the graffiti. We’re going to fix crime. On top of that, you’re going to say, ‘And by the way, when you come back, you get a big tax increase,’” he added.
The dire picture is only compounded as the unemployment rate in the five boroughs hovers at 18 percent, over 80 percent of restaurants cannot meet monthly rent obligations and thousands could face eviction notices from landlords within the next couple months.
 

David Goldsmith

All Powerful Moderator
Staff member
Manhattan is cold, the suburbs and Brooklyn are hot: Here’s what the resi market looked like in July
Deals surged in Brooklyn, Long Island and Connecticut

In Manhattan, the drops were stunning.
July contracts for co-ops priced between $4 million and $5 million were down 94 percent from the same month last year. No contracts were signed for condos above $20 million. Across all price brackets, condo and co-op contracts were down 56 percent.

But in Brooklyn — where New Yorkers often migrate to in search of bigger homes and more open space — the numbers surged: 178 new condo contracts in July, up from 147 last year. Deals for single-family homes more than doubled.

The complete picture of July contracts — detailed in a Douglas Elliman report, which covers properties from under $500,000 to more than $20 million — shows that while the Manhattan market is struggling, buyers are flocking to areas with space, including Brooklyn, Long Island, Westchester and Connecticut.

In other words, as offices and subways fade into memory, and the summer sun makes pandemic-era Manhattan even more stifling, for many buyers the suburbs have never looked better.
“Manhattan seems to be its own separate entity,” said Miller Samuel’s Jonathan Miller, who authored the report, “And I think that had a lot to do with the exodus back in March and April when about 40 percent of the residents of Manhattan moved out — and they haven’t come back yet.”

In Brooklyn, contract activity was particularly strong at lower price points. Contracts for condo units under $500,000 doubled in July from the previous year, while there were no condo deals signed in the borough for properties above $4 million.

In Long Island, however, the biggest jump in activity was at the higher end: Contracts for single-family homes above $1 million more than doubled, from 39 last July to 98 this year. The number of condo deals above $1 million jumped 185 percent.

In the Hamptons, new deals were up 120 percent, with the highest jumps seen in deals priced between $1 million and $10 million. In Westchester, contracts were up 112 percent overall.
“The pricing is so much higher in the city that its equivalent tends to be the upper ends of the suburban market, and they seem to be benefiting,” Miller said.

The shift in demand has upended the pace of business for brokers in the city and suburbs alike. Manhattan brokers, idled when the state shut down in March, are now working with a limited pool of buyers as the effects of the pandemic meet the natural clearing of the summer vacation season. (Just three properties above $4 million went into contract last week.)

In the Hamptons, brokers have been working overtime — so much so that home options for wealthy buyers are thinning, according to brokers in the area.
“If you look at the absorption now, versus last year, we’re in a whole different ballpark,” Bespoke Real Estate co-owner and co-founder Cody Vichinsky told The Real Deal in April.

“We have a very saturated market, there’s not a lot of optionality — people are definitely fitting round pegs in square holes in the process.”
 

David Goldsmith

All Powerful Moderator
Staff member

NYC moms fleeing Upper West Side amid crime and chaos
A shirtless man carrying a bottle of vodka cries out on the street as children pass by on West 79th and Broadway.

A shirtless man carrying a bottle of vodka cries out on the street as children pass by on West 79th and Broadway.Helayne Seidman
Start spreadin’ the news, they’re leavin’ today!
However, the people packing their bags are not coming to New York City — they’re fleeing it for good.
Due to increasingly squalid conditions on the Upper West Side, including two new homeless shelters packed with junkies and registered sex offenders, longtime dwellers are departing the Big Apple with no plans to ever return.
One of the Escape from New Yorkers is Elizabeth Carr, one of the area’s most vocal leaders in combatting mounting crime in the well-heeled hood. She was an administrator of the Facebook group “NYC Moms for Safer Streets,” and the face of a public-safety movement that has attracted thousands to demand better policing and city services.
“In the best of times, NYC is a hard place to live,” said Carr. “Now you have all this other stuff. It’s a question for families. … to have to see a guy masturbating on the corner or explain to my kids while I’m buying diapers at Duane Reade why this guy wearing no shoes is collapsed on the floor and they’re doing CPR on him.”

She said she started planning to move before the COVID crisis and recent neighborhood developments, but officially put down stakes Sunday in North Carolina with her finance husband and three kids under 7.
“We reached our New York expiration date,” the former nonprofit exec, who’d lived on the UWS since 2007, told The Post from her new home 600 miles away. “Things weren’t heading in the right direction. What we’re seeing now isn’t at all surprising.”
Allison Eden and her sonJ.C. Rice
Crimes committed over the past several days would’ve been unheard of a year ago in the quiet neighborhood that’s home to Lincoln Center and restaurants by Daniel Boulud. A 40-year-old woman was randomly stabbed in the 72nd Street subway station at noon on Thursday; a 56-year-old man was sucker-punched while dining outdoors with his wife Wednesday night; photos were posted online of a man masturbating on the steps of the New York Historical Society; and onlookers witnessed an apparent overdose in the aisle of a Duane Reade across the street from the Lucerne Hotel.

The Lucerne, on 79th Street and Amsterdam, and Hotel Belleclaire, on 76th Street and Broadway, were recently converted into homeless shelters, with nearly 300 vagrants between them. Ten of the men are registered sex offenders, including convicted rapists, child molesters and child-porn possessors — all living a block away from a school playground.
The alarming downturn of her beloved neighborhood, Carr said, makes it hard to look on the bright side.

“Some say, ‘It’s a great opportunity for my kids to learn compassion,’” she said of progressive pals’ response to their new homeless neighbors. “I’m a pretty compassionate person, but … at least show some respect. [The Department of Homeless Services] is just putting 283 people into a neighborhood basically in the middle of the night?”
Carr said one friend couldn’t find a broker to take on her apartment listing on 72nd and Columbus, normally a desirable spot, because conditions were so bad.
“It’s this slow slide,” she said. “How can families stay here? Does the city want families to stay?”
Other lifelong residents are saying sayonara, too.
“There was no reason to leave before,” said born-and-bred Upper West Sider Bess Fern. “Now, I’m done. I can leave tomorrow and never look back. If I never came back to this block that would be fine.”
Fern, who is six-months pregnant and the mother of a toddler daughter, just put her apartment of a decade near the Lucerne up for sale.

“I have definitely seen more crime, drugs and harassment in one week than in my whole experience growing up here,” she said. “I don’t want to see a child get hurt or raped, before they realize maybe it was a mistake to put [hundreds of] drug addicts and sex offenders near schools in the most dense residential population in the city.”
Medical workers treat a man on the floor of a Duane Reade on West 79th and Amsterdam.
Safety, as well as the state of schools, are common reasons given by nervous moms who are vamoosing. Jennifer, an UWS mother of two boys, ages 5 and 8, is concerned about the financial fate of PS 166, as more well-to-do families leave.
“The funding comes from family donations,” said Jennifer, 46, who declined to give her last name for privacy reasons. “If people move out of the city, there goes the funding for the school.” She plans to relocate to the Hamptons.
“I don’t feel safe going to the Fairway and Citarella anymore,” she said. “I have to walk by the sex offenders at the Belleclaire with my kids. Not knowing what these people are on and what it does to them scares me.”
“De Blasio seems to have some sort of vendetta against this demographic,” added Jennifer. “There’s no incentive to live here.”
Two homeless people sleep on an Upper West Side street.William Farrington
Allison Eden, 50, a married UWS mother of two teens, just listed her gut-renovated West End Avenue apartment of 22 years. “I don’t want to leave,” she said, “But I don’t feel like I have a choice now. How do I let my children cross the street when homeless people are shooting up?
“As a parent, this isn’t the place I once knew. I feel like NYC is disappearing so fast and no one’s doing anything,” said the tile manufacturer, who drags her two boys to work with her so they’re not fending for themselves outside alone. “There’s nowhere for them to go. I don’t want to feel afraid, and I don’t want my children to be scared to go outside.”
Eden loves New York — and her “fabulous” four-bedroom co-op with a fireplace — but the city’s passive neglect of the neighborhood has forced her hand.
“People are leaving not because we want to,” said Eden. “This is my home. I have my whole life here. I feel like we’re being thrown out, and so quickly.”
Amid the chaos, however, some vigilante moms are proudly staying put.
“The focus of our group is to get parents to stay in NYC by advocating for public safety and quality of life,” said Veronica Vargas Lupo, an administrator of the “NYC Moms for Safer Streets” Facebook group. “We’re not giving up.”
 

David Goldsmith

All Powerful Moderator
Staff member
School’s back on. Will the NYC resi market follow suit?
“The idea that they may shut down again really closes the door to rushing back to the city”

As the city shut down this spring, New York’s wealthiest neighborhoods saw an exodus of residents, many of whom headed to second homes or rentals in the Hamptons and other parts of the Tri-State.
Now that Gov. Andrew Cuomo has given the go-ahead to reopen schools for in-person learning statewide, will those who fled return? Reacting to Friday’s news, several brokers and housing experts doubt families will be rushing back.
Chuck Petersheim, who founded Hudson Valley-based development and real estate company Catskill Farms, said families there have been planning ahead. Schools in the area have been bombarded with new enrollment requests.
“What you’re seeing is planning on, not just what your kids are doing when everything’s open, but what happens a month from now, two months from now, when they shut down again, possibly,” Petersheim said. “The idea that they may shut down again really closes the door to rushing back to the city.”

Cuomo left the final decision on reopening to district leaders and school superintendents. Schools may open for in-person instruction as long as the region’s coronavirus positive infection rate is below 5 percent.
Brokers said decisions by individual private schools to reopen have already played a part. Jordan Sachs of Bold New York said clients began calling last week. Cuomo’s new announcement about public schools will continue to bring “some of the family market” back, he said.

“It’s definitely a driver,” Sachs said, though he noted that colleges and universities reopening would have a bigger impact on the city’s rental market.
Gary Malin, head of rentals at the Corcoran Group, said one move won’t lure back families. Neither will it fuel the rental market, he added, which in June saw vacancies hit an all-time high in Manhattan.

“Schools are step one,” he said. “My assumption is that a lot of people are concerned about, well, [for] how long? … The city is still far from being the city that people left.”
“At this point, so late in the game, it just seems like it’s not going to have the impact that it might have if it was earlier,” said Jonathan Miller, founder of appraisal firm Miller Samuel.

And if parents are still working remotely from their new homes — and will be for the foreseeable future — that increases the likelihood they will stay, Malin added. The remote work revolution has already led large companies like Zillow, Google and Twitter to announce that working from home could become a permanent option.

“This whole situation with the schools opening up for kids doesn’t change the situation with the companies that are having their people work at home,” said Gino Bello, a broker for Houlihan Lawrence in Westchester.
Some parents have been looking toward alternative options to remain outside the city.

“[Families are] trying to find the school that’s going to have the most flexibility in the face of government mandates,” Petershiem said. “And for people who can afford it, that definitely is private schools.”
In the city’s school system, which is the nation’s largest with 1,800 public schools and 1.1 million students, the governor’s move still requires buy-in.

“These school districts have to be talking to the parents and talking to the teachers, because if the teachers don’t come back, then you can’t really open the schools,” Cuomo said during the announcement. “If the parents don’t send their students, then you’re not really opening the schools.”

Hal Gavzie, head of rentals at Douglas Elliman, said that uncertainty will present another roadblock for residents’ return.
“It’s still a bit unclear what the plan is going to be,” he said. “It’s not just going to open floodgates.”
 
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