Ticker TOP for 1 MONTH Deal Vol?

David Goldsmith

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It will be interesting to compare pre-Memorial Day to post-Labor Day. We saw multiple predictions of "there will be no Summer seasonal slowdown this year" obviously fail. (Ex: https://www-forbes-com.cdn.ampproje...arket-wont-be-slowing-down-in-the-summer/amp/)
If "everyone" who either took their units off the market for the Summer or is waiting for the Fall selling season lists (and we have seen some pretty big "taken off market" numbers) it could result in a reasonable shift in Market Pulse if contracts signed doesn't rebound concurrently.

From where I'm sitting my viewpoint isn't that contract signed numbers have gone down due to seasonality, but largely because the "pent up demand" from last last year is petering out. If you look at how much above average contracts signed in Manhattan have been this year it aligns with how far below average they were last year. So I think the last 2 weeks of September will be telling.
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
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yeah I agree. Im advising agents to tell clients to focus on Sep/Oct listing wave for more options and perhaps a bit better negotiability. Time will tell. Certainly there is an inventory issue if this continues and listing season doesnt produce. I wonder tho David, how long do we stay this far over historical averages? I would have thought it would start sustainably fading by now and close the gap more than it has
 

David Goldsmith

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Take a look at that chart you presented in ?Friday's? video with actual contracts signed vs historical average. Look at the area between the 2 lines last year vs this year. When those 2 areas become equal I think that's a good sign that last year's squelched demand (historical over average) has met this year's pent up demand (actual over historical).

As far as fading goes I think 1790 contracts in a 30 day period down to 1185 is reasonably big fade over just 3 months. Especially compared to those who were saying there would be no Summer slowdown at that time. Have we seen the bottom of activity and it's going to rebound? Who knows? (NB I deleted the rest of this post about the effects of consumer confidence numbers, inflation, interest rates, etc as off topic).
 
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David Goldsmith

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For comparison, summer slowdown in contracts signed in recent years:
Year5/1 to 5/307/25 to 8/24% drop
201512199260.2403609516
201610758830.1786046512
201710418650.1690682037
20189997830.2162162162
20199487860.1708860759
 

David Goldsmith

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Here is one of the items I'm talking about when I say I think some of the data is bad. Now I don't have proof of this so you can take it for what it's worth, but I'm basing it on close to half a century of watching the rental market in NYC. I look at the drop in "inventory" from November 2020 to March 2021 and I just find it non-credible.
A) We know the bulk of new leases signed have been people making lateral for lower rent or up quality at roughly the same rent. For all of those deals the net vacancy is neutral because for each lease signed there is a 1:1 relationship with a new vacancy.
B) That time frame was too early for people who fled NYC due to pandemic to have returned due to being vaccinated (because that really didn't happen for most working aged people until at least April).
C) As I've said before I don't have numbers on this but I find it extremely hard to believe that there were tons of new hires in Big Law, Big Tech, Wall Street, etc. And we also know people in low paying service industry jobs didn't come back because all the employers who lost them are complaining that none of them have come back to work.

So what caused this huge draw down on vacancies? I posit nothing did, and we didn't see a huge drop in actual vacancies, just a huge drop in what LLs were admitting to. I think we probably are still close to peak vacancy and that's a pretty big number. I wish we had good enough data to use to make predictions, but we don't so we can't and have to go by gut feelings.

My gut tells me that if the numbers were as good as they were supposed to be based on the "better act now or you will miss out" stories then we would be getting more transparency. What I'm feeling is more like when the car dealer tells you his offer is only good now and if you walk out the door you'll never get it again.

Note the date on the article and where on the chart was right before:
Landlord group admits there are a lot more vacancies than the official count.
 

David Goldsmith

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David Goldsmith

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Delta Variant Casts a Shadow Over Midtown Manhattan’s Shaky Recovery
Signs of life have emerged as restaurants and stores reopen, but trouble looms as a rise in coronavirus cases delays some returns to the office.
Google pushes office return again until January 2022.
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
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cherry picking ill admit, right after holiday, but still, want to show where the 30 day pace is at before active season starts. Cheers all

1631066187520.png
 

David Goldsmith

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Seems like a big drop from 1,790.
I'm going to take the August will be lower than June when it "should" be higher based on history, the current hype of how hot the rental market is, and claims of how many people are returning to office starting September.
From what I can tell August activity was slightly higher than July but significantly lower than June?
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
Staff member
Seems like a big drop from 1,790.

From what I can tell August activity was slightly higher than July but significantly lower than June?
here is a good visual of what we printed (orange) vs historical monthly avg (blue) - we should book around 687 deals for Sep, currently on pace for 1100

1631281714409.png
 

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Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
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New random wager: will Oct 1st’s 30-day pace of Contracts Signed be above or below 1000, during the “active season”?

I’ll be the contrarian w.r.t. “active season” and go with below 1000.
ah, risky there ionada! Oct is typically a bump up month as Sep is the weakest month...should we change to Sep for this bet? If not, def over 1k unless there is a stock crash or another lockdown
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
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That's what I meant, the 30-day lookback from Oct 1st. A.K.A. Sep 1st - Sep 30th. I'm saying below 1000.
lol, love the video reference..ok! lets roll...I will keep it real and say above 1k by Oct 1 check in...soon we need to start putting real wagers on these hehe
 

David Goldsmith

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  1. This week’s August 2021 Manhattan, Brooklyn, and Queens Rental Report showed a lot of volume as we have seen since the spring, but not as much as expected.
  2. Net effective median rent fell annually by its lowest rate in fifteen months
  3. Doorman median rent rose year over year as non-doorman median rent declined
  4. New development median rent continued to expand annually as existing median rent fell
  5. Downtown was the only region of the four main regions not to see an annual decline in the median rent
 
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