The Housing Market Just Shipped Its Pants

December 16, 2022

Apparently, you can ship your pants for free…

If this clip sounds familiar, it’s because I used it more than six years ago here. I love staccato bursts of dry humor, and seeing it again on Instagram meant I had to use it again. Apparently there is no policy at Housing Notes that prevents me from reusing clips.

But I digress…

Manhattan Sales Over $50 Million Are Only Two Away From Tying The Record

While it’s an end-of-the-year thing, and I’ve long thrashed the relevance of super luxury sales, referring to them as a “circus-sideshow” for years, generally irrelevant to the local housing market, it’s fun to recap the year. Bloomberg just released a top 10 Manhattan list. And I found a dozen sales at or above the $50 million threshold. There are still two weeks to go; as of today, 2022 is the third-highest number of sales over $50 million. Only two more sales are needed to match the 14 unit records set in 2014 and 2019, and it’s plausible that the record will be broken in the next two weeks.

What started in 2014 as a once-in-a-blue-moon spreadsheet effort became a regular task as these sales continued to occur and the data is sloppy. This new market segment was created nearly a decade ago as the value of these super luxury market units was reset by the geo-political changes at the time.

Considering the sales dollars for each year, 2019 is the clear leader with over $1 billion in total. If we look at the average price per unit (no chart for this yet), 2021 was the winner at $80,752,100 per transaction.

And this is only Manhattan!

The Demand For Remote Jobs Far Exceeds Demand For Office Jobs

This LinkedIn take is fascinating and suggests that remote work is here to stay and isn’t a passing fad.

As Governor Hochul of New York State noted on Wednesday with the release of the “Making New York Work for Everyone” that the recovery has peaked and things like office occupancy and subway ridership are no longer expanding.

The sooner cities adjust to the realities of remote work, the better. Here’s the plan. I recommend reading it to anyone in New York City real estate. While it sounds encouraging, as it is designed to be, it’s important to remember that the prior administration struggled for eight years to reach 200,000 units. Fingers crossed.

Here are the macro goals.

1) Reimagine New York’s Commercial Districts as Vibrant 24/7 Destinations
2) Make It Easier for New Yorkers to Get to Work
3) Generate Inclusive, Future-Focused Growth

Inflation Expectations Are Deflating…Slowly

With lower inflation rates usually comes lower borrowing costs and higher home sales, something market participants hope comes soon. The fed raised rates 50 basis points, a step below the last four 75 basis point increases; even though the fed suggests more rates to come in 2023, the heavy lifting has been accomplished. The forecast seems to be 75 basis points more but spread over two to three announcements in 2023.

Here’s a recap of Wednesday’s release. The next announcement will come on February 1.

Fed Raises Rates at a Slower Pace: Live Updates [NYT]

I collected a slew of charts leading up to this moment.

My USAToday Housing Market Prediction For 2023

This week I was asked by USA Today to predict an aspect of next year’s housing market. I focused on the lack of listing inventory since that’s a factor that has been noticeably absent from prior market downturns.

I shared this piece with a bunch of my colleagues, and the majority of the feedback centered on how good my headshot was. Sigh.

Housing market predictions: Six experts weigh in on the real estate outlook in 2023 [USAToday]

Here is a sampling of annual listing inventory tracked by year we’ve collected in LA and the NYC metro area.

This low listing inventory trend seems to be born out by Google Trends, no? Ha.

NYC’s Roosevelt Island: Where Trash Sucks

After the US Postal System used a pneumatic system in NYC, Roosevelt Island got a pneumatic system for trash. I had no idea!

New Yorker: Weighing The Value Of Searching For Property Sales

Getting Graphic

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

My favorite random charts of the week made by others


[Source: Flowing Data]


[Source: The Economist (2021)]

Appraiserville

(For earlier appraisal industry commentary, visit my old clunky REIC site.)

ASC Hearing On Appraisal Bias January 24, 2023

All appraisers should get this hearing on their schedule and check back in later for the link. The registration link will be available soon.

OFT (One Final Thought)

I know the following is a bit morbid but still fascinating. What happens when a large plane falls into a high-density residential neighborhood? I think about that every time I land at LaGuardia. Here’s a short segment of the news coverage of the December 16, 1960 event, 62 years ago today, from the NYPR Archive Collection. I was just a few months old! Here’s a recent look at the site by Untapped Cities.


[Source: WNYC, Caption: The tail section of United Airlines airliner, which crashed in a heavily populated section of Brooklyn, New York, December 16, 1960, rests at the intersection of Sterling Place and 7th Avenue. ( AP Photo/stf )]

To avoid ending on a bad note, here’s the first recorded snowball fight (1897)!!!

Brilliant Idea #1

If you need something rock solid in your life (particularly on Friday afternoons) 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 ship their pants;
– You’ll ship your pants;
– And I’ll try to find a K-Mart.

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 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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