The Housing Bunny Shows Us He’s Ready To Rumble
The moral of the story, don’t judge a bunny by its cute, cuddly exterior. Inside there may be a stronger person that is ready to fight.
But I digress…
Elliman Reports Released: Q1-2019 Hamptons, North Fork and Long Island
This was the final week of our four week quarterly report gauntlet. Phew. More markets are being added next quarter to our expanding Elliman Report series I’ve been authoring since 1994.
Of utmost importance was a Bloomberg chart (2 versions) on the spike in listing inventory…
Here are some key observations of these markets:
Elliman Report: Hamptons Sales 1Q 2019
“The sub-million dollar market had its second highest sales share in five years.”
– Second highest market share of sales below $1 million in five years
– The number of sales has declined annually for the fifth straight quarter as the market resets
– Lowest first quarter number of sales in seven years
– Listings inventory rose sharply for the last two quarters
– Tied for the lowest number of sales at or above $10 million in six years
– Luxury listing inventory expanded sharply for six straight quarters
Elliman Report: North Fork Sales 1Q 2019
“Stable pricing with easing sales growth.”
– Median sales price has not shown a year over year decline in eight straight quarters
– Listing inventory edged higher year over year for two straight quarters
– The number of sales declined year over year for the third time in four quarters
– The market share of sales under and over $1 million was unchanged
– Tied for the second lowest number of sales above $2 million in six years
Elliman Report: Long Island Sales 1Q 2019
“Sales slowed as prices continued to rise.”
– There has not been a year over year decline in median sales price for twenty-four consecutive quarters
– The number of sales slipped year over year for the second time in three quarters
– Listing inventory expanded annually for the first time in four quarters
– Shortest first quarter marketing time for single-families in at least twelve years
– The number of condo sales has declined year over year for five consecutive quarters
– Luxury listing inventory rose year over year for five straight quarters
Elliman Reports Released: Aspen/Snowmass Village, Los Angeles, Venice/Mar Vista, Malibu/Malibu Beach
Elliman Report: Aspen + Snowmass Village Sales 1Q 2019
“Market-wide sales continued to see annual gains for the second straight quarter.”
– The number of sales expanded year over year for the second straight quarter
– Average sales sized increased annually for the second time in three quarters
– Listing inventory annually edged higher for four straight quarters
– Luxury average price per square foot declined and listing inventory expanded annually for three straight quarters
– The entry-threshold drifted lower year over year for three consecutive quarters
Elliman Report: Aspen + Snowmass Village Sales 1Q 2019
“Larger sales size skewed price trends higher as sales slowed.”
– The average sales size surged, skewing all price trend indicators sharply higher
– The number of sales declined faster than listing inventory, slowing the market pace
– The number of sales declined annually for the first time in eleven quarters
– Luxury average price per square foot rose year over year for the second straight quarter
– The average size of a luxury sale jumped from the year-ago level
Elliman Report: Los Angeles Sales 1Q 2019
“Overall market share of pocked/whisper listings declined as listing inventory expanded.”
– Number of sales declined year over year for the fourth straight quarter, consistent with the decade quarterly average
– Price trend indicators showed mixed results, with median sales price falling from the year-ago record
– Listing inventory expanded year over year for the fourth consecutive quarter
– Market share of pocket/whisper listings fell across most price categories
– Sales market share of larger single-family sales declined
– Luxury price trend indicators for condo and single-family sales generally moved higher
Elliman Report: Malibu + Malibu Beach Sales 1Q 2019
– Malibu single-family and condo sales year over year remained well below year-ago levels as sales size shifted to smaller homes
– Malibu Beach single-family and condo inventory fell as average sales size skewed lower
Elliman Report: Venice + Mar Vista Sales 1Q 2019
– Venice single family and condo price trend indicators ranged from flat to rising year over year as sales remained well below year-ago levels
– Mar Vista single-family and condo price trend indicators rose sharply as inventory expanded sharply but remained inadequate for the demand
Elliman Reports on Greenwich and Fairfield County, Connecticut Featured on CNBC
Diana Olick at CNBC reached out to me this week to talk about the Q1-2019 Elliman Report on the Greenwich, CT housing market and the impact of the federal tax law on high-end suburban markets in NYC metro. We spoke on Greenwich Avenue in Greenwich at 8:30 am and had to keep doing segments over because of the random roars of delivery and garbage trucks. The irony was not lost on me – a busy downtown with not a lot of empty parking spaces so early in the morning – combined with a slow housing market. Anecdotal but this is what we are seeing at the macro level – a robust regional economy with soft housing conditions.
We were set up in front of a Vineyard Vines store while I was wearing a bright Ted Baker tie (Hey, I can be a social media style influencer too). The irony in this product placement “ties” this story altogether (in my own mind). I received more feedback about my tie than I did on my content. Oh well. And for the record, Diana made very clear to me that she commented on my tie first.
Here’s the segment that also includes my friend Jennifer Leahy of Douglas Elliman, their number one agent in Connecticut who just sold the massively oversized home of 50 Cent.
Streeteasy’s Out East Site Has Brokerage Community Where They Want Them
The brokerage community is complaining that the new Streeteasy site for the Hamptons and North Fork – Outeast – is preventing them from serving the consumers.
Let me start from the beginning.
It has been almost six years since Zillow acquired Streeteasy, the defacto MLS system for Manhattan. Streeteasy, as conceived, was an elixir that the brokerage community (and me) became addicted to. There had been no listing search engine that understood vertical housing markets since most platforms are “flat file” like in functionality. Zillow today and others remain like that. Condo unit 3A is viewed on its own merits and not with condo unit 47A in the same building at the same time. I had incorrectly assumed that Zillow would use Streeteasy to power the vertical housing markets they cover, but instead, they opted to use the acquisition to buy into the NYC market and have spent the time removing the bells and whistles that made Streeteasy so cool since there has been no real competition. Sure REBNY tried with their RLS system, but they don’t have the money to compete in the same league as Zillow and Zillow has won the consumer with hundreds of millions in marketing. Now that they won the consumer, they rolled out their Premier Agent program at $333 per month per listing because they enjoy the monopoly that MLS systems around the country have long been accused of. Except that this is not a consortium of companies, it is simply a single tech platform.
I understand the New York Department of State is wrestling with this situation right now and the MLS world is watching for their final decision. I wouldn’t hold your breath.
Now we are seeing the same thing playing out in the eastern end of Long Island over the past two weeks – the brokerage community in the Hamptons seems to be besieged by tech issues now that they are forced to use the Streeteasy site Outeast now that they turned off editing of the Realnet site they acquired. The site is being forced on the community and it is not ready for daily use. Monopolies arent motivated in the same way as when competition exists.
Here are some of the incoming broker responses who are using a system that is not ready for prime time:
Their averaging stat misrepresents seasonal rents:
customers can not figure out what the rental prices are I always have to ask them first what period they are interested in and I think since averages are so high it keeps full season rentals from calling.
It’s been 2 weeks it is a crisis mode now for our business!
It took me two weeks to enter a rental condo , all my rentals
Are average year round prices-shows up and most are only summer – you cannot average a Hamptons summer by the year .
Listing entry process is flawed
Who is your supervisor, you have no phone support you have a system that clearly doesn’t work and I have listings that can’t be entered. Where IS the old sale that was entered for the same address. I thought I could just use that. What is going on over there? How can you release a system that doesn’t work. Where is the open house info? Where is the day sheet. How do you operate a system that doesn’t work.
YOU GAVE ME A BICYCLE WITH NO TIRES AND ASKED ME TO PEDAL
There is more. I’ll expand on this topic this weekend over on my Matrix Blog.
In Canada, Losing A Purchase Deposit Can Be Gangsta
A one-time potential purchaser of a luxury home in Vancouver was not entitled to their $220,000 deposit back:
But property investor Shao Feng Yun wanted nothing to do with the mansion after finding out that notorious triad boss Raymond Huang Hong Chao was shot dead outside the front gate in 2007, in an unsolved gangland hit.
I’d be curious whether the property subsequently sold and there was any stigma attached to the sale.
Vertigo-Inducing Photos of Second Tallest NYC Building By Height
YIMBY has a photo spread of 111 West 57th Street that is worth visiting. The technical challenges of this kind of construction have to be unreal but the views must be spectacular as visits to other supertalls have shown me.
My goal in life is to visit a top floor unit during a Hurricane without taking Dramamine. Here are a few of the photos taken by Michael Young for YIMBY. The third one was the most vertigo-inducing. Clicking on each takes you to the source article.
HowMuch.net: Salary Needed to Buy A House In The Largest U.S. Metros
Chart eye candy.
Tip: Remove All Your Toilets to Save Money on Property Taxes
Over the last few weeks, I have been particularly sensitive to the notion that consumers modify their behavior, especially the wealthy when it comes to avoiding paying taxes. The idea that they have so much money that they don’t modify their behavior is lazy armchair economics.
Here is an amazing example of tax avoidance in Chicago if the charges are true.
One of the mayoral candidates in Chicago is accused of removing all the toilets in one of his extra homes to save $330,000 in property taxes.
The appraisal noted that “there were no functioning bathrooms in the house since all the toilets were removed,” adding that there were appliances in the “cooks’ kitchen” in the basement. It also noted that one stairway banister was braced and another one “sloped noticeably to the right side.”
No photos to be found online taken of the house or the lack of toilets…
Len Kiefer‘s Chart Handiwork
[click to expand]
His forecasting model for EHS is mindblowing. The change in forward-looking views has been incredibly volatile.
(For earlier appraisal industry commentary, visit my old clunky REIC site.)
Look for more discussion about the seminal NYS AMC Law this weekend over on my Matrix Blog.
Your Reports Can Turn Up Anywhere
– Toilet Removals Noted In Chicago Mansion By Appraiser In Tax Appeal. This was discussed in these Housing Notes higher up on the page but note how there is opposing evidence of a bathroom in the house after all. If true, this is an example of an appraiser as a “deal enabler” rather than a trusted neutral observer. I’ll bet they never thought this would be an issue discussed in the Chicago Tribune. Ugh.
OFT (One Final Thought)
I actually bought one of these last summer. It didn’t work (burn off carbs, that is).
Trying to be healthy, so I bought a bike and cutting carbs. pic.twitter.com/3PNDVbFF2U
— You Had One Job (@_youhadonejob1) April 22, 2019
Brilliant Idea #1
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Brilliant Idea #2
You’re obviously full of insights and ideas as a reader of Housing Notes. I appreciate every email I receive and it helps me craft the next week’s Housing Note.
See you next week.
Reads, Listens and Visuals I Enjoyed
- Woman loses deposit on US$11m Vancouver mansion where triad boss was killed [South China Morning Post]
- Is Real Estate Losing Its Business Compass? [Warburg Realty]
- Rapper 50 Cent sells his mansion for a snip – here’s what it looks like [South China Morning Post]
- Hedge fund manager Ken Griffin buys $238 million condo in NYC, boosting prices
- Boston area’s population increases—along with housing costs and commute times [Curbed Boston]
- A Tycoon Just Spent $180 Million on Hong Kong Luxury Property [Bloomberg]
- Visualizing How Americans Spend Their Money [howmuch.net]
- Historic Wood-Frame West Village House (Possibly With Secret Tunnel) On The Market For $12 Million [Gothamist]
- Where U.S. Millennials Are Moving to Most [Bloomberg]
- Cook County watchdog says 'scheme to defraud' saved Pritzker $330,000 in property taxes [Chicago Tribune]
- No, New York City is not banning glass-and-steel skyscrapers [Curbed]
- 111 West 57th Street's Super-Slender Concrete Formwork Officially Tops Out Atop Billionaires' Row, in Midtown [New York YIMBY]
- More States Are Pursuing Rent Control. That’s Bad News for Landlords. [Wall Street Journal]
- Prices drop, developers offer incentives as Vancouver condo market cools off [Vancouver Sun]
- The problem with San Francisco poop maps [Curbed]
- Keller's second coming [The Real Deal]
- Do You Earn Enough to Afford a House in the Largest U.S. Metros? [howmuch.net]
- 2019 Canada Housing Market Outlook: Slower, Steadier [Moody's Analytics]
- America Isn’t Building Enough New Housing
- UBS Global Real Estate Bubble Index 2018 [UBS]
- New York City is creating jobs but losing people [Crains]
- Paul Simon Lists Connecticut Countryside Estate for $13.9 Million [The Wall Street Journnal]
- How Luxury Developers Use a Loophole to Build Soaring Towers for the Ultrarich in N.Y. [NY Times]
- Why Rent Control Doesn’t Work (Ep. 373) [Freakonomics]
- Pulling out all the stops [The Real Deal]
- When Home Sellers Have Regrets [Wall Street Journal]
- Who’s Really Buying Property in San Francisco? [The Atlantic]
- This is how America's housing affordability is impacting credit quality [Housingwire]
- Frozen Market: Developers Wait While Albany Considers Rent Regulations [Bisnow]
- From Gentrification to Decline: How Neighborhoods Really Change [Citylab]
- Sell your home with a Realtor or an algorithm? Maybe both. [Marketwatch]
- Zillow sues Compass for poaching execs, allegedly stealing trade secrets [The Real Deal]
My New Content, Research and Mentions
- Douglas Elliman Releases Q1 2019 Greater Los Angeles and LA Submarkets Sales Market Reports
- Douglas Elliman Releases Q1 2019 Aspen and Snowmass Village Sales Market Reports
- Douglas Elliman Releases Q1 2019 Long Island, Hamptons, and North Fork Sales Market Reports
- Ouch! New tax code hit Wall Street where it hurts: Hamptons home prices
- LA luxury resi sales plummet in the first quarter: Elliman report
- Down and out in the Hamptons: Americans’ exodus from high tax states
- Home sales in the Hamptons just slumped to the lowest level in 7 years | Markets Insider
- Bank OZK Lends $95M on Midwood’s Planned UES Condo Project
- Unsold Luxury Homes Are Piling Up in the Hamptons
- New tax laws take a toll on home sales in Connecticut [CNBC]
- Imóveis de luxo perdem brilho nos Hamptons com mercado saturado
- Luxury Loses Luster in Hamptons as High-End Homes Pile Up
- La La Land’s Housing Market Comes Back Down to Earth
- Hamptons, N.Y., Sees Downturn in First Quarter Home Sales
- Ley fiscal federal ayuda a que compren viviendas lujosas en Miami Beach – Miami Diario
- Prices for mega-mansions in Miami Beach surge 61%
- 5 two-bedroom rentals with roof deck access for under $3,000 so you can get some sun
- Sales of the cheapest and swankiest homes are tanking, but for very different reasons
- WATCH: Gary Barnett on the residential market, Brooklyn and discounts at One Manhattan Square [The Real Deal]
- It's one of the richest towns in America. Now some say you can't give away a house there.
- ANALYST: Luxury Delray Real Estate Troubled, Boca Slightly Better
- Residential market report [The Real Deal]
- NYC's ghost towers [The Real Deal]
- Douglas Elliman Releases Q1 2019 Downtown Boston Residential Market Report [Citybizlist]
- Douglas Elliman Releases Q1 2019 South Florida Market Reports [citybizlist]
- Minat Pembelian Rumah Mewah di Greenwich, AS, Bergeser ke Rumah Sederhana [Kabar24]
- World 'hedge fund capital' mansions left empty as even the rich start downsizing [Fin24]
Recently Published Elliman Market Reports
- Elliman Report: Aspen + Snowmass Village Sales 1Q 2019 [Miller Samuel]
- Elliman Report: Malibu + Malibu Beach Sales 1Q 2019 [Miller Samuel]
- Elliman Report: Venice + Mar Vista Sales 1Q 2019 [Miller Samuel]
- Elliman Report: Los Angeles Sales 1Q 2019 [Miller Samuel]
- Elliman Report: Hamptons Sales 1Q 2019 [Miller Samuel]
- Elliman Report: North Fork Sales 1Q 2019 [Miller Samuel]
- Elliman Report: Long Island Sales 1Q 2019 [Miller Samuel]
Appraisal Related Reads
- 25 Common Errors in Appraisal Reports [McKissock Learning]
- Appraiser Falsely Accused by Agent / Homeowner Wins [Appraisers Blogs]
- How much is that new roof & AC unit worth? [Sacramento Appraisal]
- Facing Fraud [Appraisal Buzz]
- Beware of Appraisers Point Solicitations [AppraisersBlogs]
- De Blasio hands over appraisals after weeks of evasion [NY Daily News]
- The Importance of an Appraiser [VaCAP Board]
- More Bad News For Appraisers [Palisades Hudson Financial Group]
Extra Curricular Reads
- The Clockwork Condition: lost sequel to A Clockwork Orange discovered [The Guardian]
- Successful People Listen to Audiobooks | Nora Caplan-Bricker [The Baffler]
- Prince Estate to Release ‘Originals’ Album: His Versions of Songs He Gave to Other Artists (EXCLUSIVE) [Variety]
- The Company That Sells Love to America Had a Dark Secret [NY Times]
- Beyond Meat to seek $175 million in IPO [Marketplace]
- E.U. Votes to End Mandatory Switch to Daylight Saving Time [NY Times]
- Permanent daylight saving time passes Washington state House 90-6, heads to Inslee’s desk [Seattle Times]
- The Problem With Most Financial Advice [Of Dollars And Data]
- No, You Don’t Have to Stop Apologizing [New York Times]
- Nichification – The Big Picture [Ritholtz]
- Game Boys have infinite lives. At 30, they live on in unexpected ways [LA Times]