Housing Without Furniture

April 14, 2023

Kurt Russell, one of my favorite actors as a kid with all the Disney movies he did and peaking as Snake Pliskin in Escape From New York, grew up fielding ground balls in his living room (that didn’t have furniture).

Did you miss last week’s Housing Notes? April 7 – Rapping About Housing For Any Occasion

But I digress…

Manhattan Rental Prices Rise To New High

I’ve been the author of an expanding series of market reports for Douglas Elliman Real Estate since 1994. We release our rental research every month, covering Manhattan, Brooklyn, and the northwest region of Queens (each borough separately).

Bloomberg News coverage of the report was the third most-read article across their 325,000 terminal subscribers worldwide.

And a chart that shows how the market peaked last summer and more or less moved sideways since but breaking through to a new record in March.

And the New York Post repurposed a chart on our website that illustrated the long-term price trend.

Elliman Report: March 2023 Manhattan, Brooklyn and Queens Rentals

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MANHATTAN RENTAL MARKET HIGHLIGHTS

“Net effective median rent reached a new high as new lease signings were the second-highest March on record.”

– Net effective median rent and median rent reached new highs
– New lease signings were the second-highest total for a March on record
– Listing inventory expanded annually for the fifth consecutive month
– Non-doorman price trend indicators continued to see more annual gains than doorman rice trend indicators
– New development rental new lease signings rose at triple the annual rate as existing rental lease signings
– Luxury median rent rose annually for the twenty-first consecutive month
– More than half of all luxury tenants signed two-year leases for the third straight month
– Luxury listing inventory has been rising annually since last summer but remains well below the decade average

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BROOKLYN RENTAL MARKET HIGHLIGHTS

“Net effective median rent reached the second-highest level on record as new lease signings set a new record for the month of March.”

– Net effective median rent was the second-highest on record as median rent for March reached a new high
– Listing inventory expanded annually for the fourth time
– New lease signings for March were the highest on record

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QUEENS RENTAL MARKET HIGHLIGHTS

[Northwest Region] “Net effective median and median rent reached their second-highest levels on record.”

– Median and net effective median rent were the second-highest in history
– New leases rose to a new record for March
– Bidding wars rose to more than one in five leases, the highest in more than two years of tracking

Brooklyn and Riverdale Still See Rising Prices While Queens Prices Slip

Two things these three markets have in common? Sales are down sharply from the rocketship of the pandemic and inventory levels remain light.

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BROOKLYN SALES MARKET HIGHLIGHTS

Elliman Report: Q1-2023 Brooklyn Sales

“Median sales price remained at the third-highest level on record.”

– Median sales price edged up year over year to the third-highest level on record
– Sales fell sharply year over year to a level consistent with the first quarter decade average
– Listing inventory fell year over year for the fourth consecutive quarter

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QUEENS SALES MARKET HIGHLIGHTS

Elliman Report: Q1-2023 Queens Sales

“Price trend indicators slid annually but remained above pre-pandemic levels.”

– Price trend indicators declined annually but remained higher than pre-pandemic levels
– Sales fell sharply year over year to a level just below the first quarter decade average
– Listing inventory edged higher year over year and was consistent with the first quarter average for the decade

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RIVERDALE SALES MARKET HIGHLIGHTS
[includes Fieldston, Hudson Hill, North Riverdale, and Spuyten Duyvil]

Elliman Report: Q1-2023 Riverdale (Bronx) Sales

“Price trend indicators expanded as listing inventory continued to decline.”

– Median sales price increased year over year for the fourth time in five quarters
– Sales fell annually for the third consecutive quarter, constrained by the drop in listing inventory for four straight quarters
– Sales below $750,000 fell sharply year over year as sales above expanded

Westchester Listing Inventory Remained Near Record Lows

Compared to the city, the New York City suburbs remain short of supply despite the sharp drop in sales from the heady times of 2021 and early 2022.

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WESTCHESTER SALES MARKET HIGHLIGHTS

Elliman Report: Q1-2023 Westchester Sales

“Median price rose to the highest first quarter on record.”

– Listing inventory declined annually to the second-lowest on record and the lowest first quarter on record
– Median sales price rose annually to the highest first quarter on record
– More than one out of four sales closed above the last asking price
– Single family listing inventory declined year over year for the fifteenth time in sixteen quarters
– More than three out of four condo sales that closed in the quarter were above the last asking price
– Luxury median sales price fell annually for the first time in eleven quarters
– Nearly one out of four luxury sales closed above the last asking price
– Luxury listing inventory declined to the second-lowest on record

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PUTNAM SALES MARKET HIGHLIGHTS

Elliman Report: Q1-2023 Putnam/Dutchess Sales

“Listing inventory fell to a record low, restraining sales in addition to higher mortgage rates.”

– Listing inventory declined annually to the lowest on record
– Median sales price declined annually for the first time in eleven quarters
– The number of sales fell year over year for the sixth consecutive quarter

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DUTCHESS SALES MARKET HIGHLIGHTS

Elliman Report: Q1-2023 Putnam/Dutchess Sales

“Listing inventory expanded from last year’s record low but remained sharply below pre-pandemic levels.”

– Listing inventory rose year over year from last year’s record low
– Median sales price declined annually for the first time in fifteen quarters
– The number of sales fell year over year for the fifth straight quarter

Getting Graphic

My favorite housing market/economic charts of the week made by others

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Apollo’s Torsten Slok‘s amazingly clear charts.

Kastle card swipe data charts

Remember that Kastle charts are overstating occupancy* because their pre-pandemic occupancy benchmark was 100% which is simply incorrect (*measures card swipe activity as a proxy for occupancy).

My favorite random charts of the week made by others

Appraiserville

Byron Miller Is Running For Appraisal Institute’s 2024 Vice President

Byron Miller, SRA, AI-RRS, is a former engineer turned appraiser I got to know at RAC, an organization of the best residential appraisers in the U.S. He served as president of RAC after I did. I got to know him during that period. I consider him a friend and was pleased to hear he was running for Vice President at the Appraisal Institute. He’s got an amazing last name, but let’s dig deeper. Byron is a residential appraiser (from Minnesota) who teaches a lot and has been active in pushing forward policies that protect appraisers (more on that later).

He is running against three others; two are hardcore FOJs (rudderless without their Dear Leader around anymore), and one I don’t know much about.

Working RE just published a piece featuring Bryon and his accomplishments for his home state. The title of the piece: Grassroots Lobbying 101: How Appraisers Can Effect Change says a lot about what Byron has accomplished for his home state.

I also love that I needed to copy and paste Byron’s full title from the article because it was too long for my short attention span to type, but it shows how passionate he is about the profession:

Byron Miller, SRA, AI-RRS, ASA, RAA, MSSE and Chair of the Government Relations Sub-Committee for the North Star Chapter of the Appraisal Institute (NSAI-GRC), is one such appraiser. Alongside a handful of other passionate boots-on-the-ground real estate appraisers, Miller has succeeded in changing the regulatory environment for appraisers—in his home state of Minnesota.

The article presents a summary of the NSAI-GRC team’s accomplishments over the past seven years.

I’m not part of AI, but I’d vote for Byron if I were in favor of keeping the organization moving in the right direction, away from a two-decade era of blatant self-dealing. Fingers crossed.

WVREAB Chair Dean Dawson Continues to Impede Commerce In West Virginia

I spoke about this lawsuit a few weeks ago and wanted to share more thoughts simply because it is so outrageous. The plaintiff in the lawsuit against Dean Dawson has been an appraiser for 25 years with no suspensions or admonishments.

An individual hired the plaintiff as an expert in a matter. The opposition, the gas company, hired Dawson in the same matter where a “natural gas compressor station” was reportedly built on the wrong property. I understand that the plaintiff completed no appraisal, but initial research was performed. The appraiser wrote a letter stating what could be done if the client wished the appraiser to complete the assignment.

The appraiser representing the gas company in the “natural gas compressor station” case was The West Virginia Real Estate Appraisal Board Chairperson, Dean Dawson. Dawson suspended the opposing appraiser’s license without a hearing or notification. Dawson somehow forgot to disclose that he was on the other side of the case. The appraiser plaintiff only found out their license was suspended when they were alerted by an AMC client who saw the status change on the ASC website. This action probably stopped other clients from giving the plaintiff new business.

After the plaintiff’s personal attorney contacted the West Virginia State AG, the license was immediately reinstated.

After the license was reinstated, the appraiser was sent a consent decree by the West Virginia Real Estate Appraisal Board (Chaired by Dean Dawson) that said all that had occurred in this matter would be expunged from the record with some schooling if the appraiser would not sue them. By offering this, the Board (Chaired by Dean Dawson) must have known what it did was illegal.

The appraiser moved forward anyway and filed a lawsuit. The trial is scheduled for Fall 2023. I will share more details as this matter unfolds. It’s tough enough to be an appraiser these days…

A Better Way To Think Time Versus Accuracy

Appraiser and prolific writer on valuation issues Steven R. Smith, MSREA, MAI, SRA over at the National Appraisal Forum penned a piece: Appraisal Accuracy Estimates

May 19: ASC Hearing On The Appraisal Regulatory System

OFT (One Final Thought)

I love Old NYC videos – this one (click on “New York City in 1911) was taken from the Flat Iron Building – no traffic lanes!

New York City in 1911
by u/Kr0pr0X in nyc

Brilliant Idea #1

If you need something rock solid in your life (particularly on Friday afternoons at 2 p.m.) and someone forwarded this to you, , or you think you already subscribed, sign up here for these weekly Housing Notes. And be sure to share with a friend or colleague if you enjoy them because:

– They’ll be fielding ground balls in their empty living room;
– You’ll be looking for an affordable rental;
– And I’ll be re-watching “Escape from New York” for the 20th time and thankful that Manhattan had a positive net migration in 2022.

Brilliant Idea #2

You’re clearly full of insights and ideas as a reader of these Housing Notes. Please share them with me early and often. I appreciate every email I receive, as it helps me craft the following week’s Housing Note.

See you next week!

Jonathan J. Miller, CRE, Member of RAC
President/CEO
Miller Samuel Inc.
Real Estate Appraisers & Consultants
Matrix Blog
@jonathanmiller

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