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:
Manhattan landlords are keeping more apartments empty as rents slip, betting that the market will recover as the pandemic eases.
therealdeal.com