Focus of 2022 Housing To Be Achieved By Crossing The Finnish Line

January 14, 2022

Since we’re headed to Finland this fall (fingers crossed), I needed to catch up on what it’s like there, and of course, Twitter told me. And of course, without slighting the Finns, I used “Finnish” incorrectly in the title but hey, it worked.

But I digress…

The NYC Rental Market Final Breaks Even With Pre-Pandemic But Is Much More Polarized

I’ve been tracking the rental market for Douglas Elliman for years as part of their expanding market report series. The Manhattan portion of the report fueled a lot of interest as many tenants that came in during the early dark days of the post-lockdown summer of 2020 got deals that are no longer in the ball-park of what landlords are willing to negotiate.

CNBC, Bloomberg and New York Times blew up the story and it got everyone’s attention. So did Crains, Brick Underground and CBS New York. All the links are down at the bottom of the newsletter.

Of course, Housing Notes readers know that charts are everything here and Bloomberg has a fun one, tracking the fourth quarter of Manhattan rents back a decade using our data in Manhattan Rents Surge to Record on Demand for Doorman Buildings – plus I added a couple of our own below.

Elliman Report: December-2021 Manhattan, Brooklyn & Queens Rentals

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MANHATTAN RENTAL MARKET HIGHLIGHTS

“Net effective median rent reached its highest level and new lease signings fell by its highest annual rate respectively for the month of December.”

– Net effective median rent rose to its highest level for the month of December on record
– Listing inventory fell year over year at a record rate for the fifth consecutive month and is now below pre-pandemic levels
– The most significant annual decline in new lease signings for the month of December on record
– Doorman median rent has risen annually at a record rate for the past three months and is above the same period two years ago
– Non-doorman rent has increased annually for three straight months but remains below two year-ago levels
– Luxury net effective median rent and the net effective average rent rose to the second-highest level on record and are higher than pre-pandemic levels
– Luxury listing inventory fell year over year for the eighth consecutive quarter
– Luxury landlord concessions have fallen by half from the same period last year

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BROOKLYN RENTAL MARKET HIGHLIGHTS

“Net effective median rent reached its fourth-highest level and listing inventory fell at its highest annual rate for the month of December.”

– New lease signings rose year over year for the sixteenth consecutive month
– Listing inventory fell at its highest annual rate on record
– Net effective median rent increased annually at the fourth-highest rate on record for the month of December

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QUEENS RENTAL MARKET HIGHLIGHTS

[Northwest Region] “Listing inventory fell at its highest annual rate while net effective median rent surged by its fastest annual rate respectively, on record.”

– Net effective median rent rose above the same period two years ago for the first time in nineteen months
– Net effective median rent rose at its fastest year over year rate on record
– Listing inventory fell annually at its most significant rate in more than a decade

[WCBS VIDEO] NYC Pandemic Rental Deals Are Over

I was interviewed by CBS New York TV soon after our report was released, part of the general media pandemonium caused by the results of our research. They asked me if I’d be willing to come into the studio but I am not ready to do those in-person’s yet. Still, it was a fun conversation and I got a few soundbites into the mix.

Westchester County Has Very Few Homes To Sell

Our Westchester County, New York report was covered by Bloomberg Westchester Runs Out of Home Listings in Rush to NYC Suburbs and yes, they produced a chart and yes, we all know life = charts. So much so that there are two versions in different colors, to further make my point.

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WESTCHESTER SALES MARKET HIGHLIGHTS

“The county experienced the fastest-paced market in four decades.”

– The pace of the market was the fastest reached in four decades of tracking
– One out of three sales went to bidding wars as listing inventory fell to its lowest level in twenty-seven years
– The number of sales surged to its highest fourth-quarter total since tracking began in 1981
– The market share of single-family bidding wars was the third highest in history
– Condo average sales price and median sales price were the first and second highest in history, respectively
– Luxury listing inventory fell to a record low for the fourth time in the past five quarters
– Months of supply for the luxury market showed the fastest pace on record for the second straight quarter

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PUTNAM SALES MARKET HIGHLIGHTS

“All price trend indicators pressed sharply higher.”

– All price trend indicators increased annually but also saw two to three times the growth over the same period two years ago
– Sales slipped annually for the first time in two years after seven quarters of significant year over year listing inventory declines
– The decline in months of supply resulted in the fastest market pace on record

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DUTCHESS SALES MARKET HIGHLIGHTS

“Listing inventory fell to the lowest level on record.”

– Median sales price reached a top three price record for the sixth straight quarter
– The number of sales rose sharply year over year for the fifth straight quarter
– Listing inventory fell annually for the ninth consecutive month to the lowest level on record

[HGAR Webinar] NYC Metro Housing Market Discussion Better Than A Cup Of Sand

I really enjoyed participating in this call by the HGAR MLS and sponsored by TitleVest. My co-panelists were Marissa S. Tracey of Citi Private Bank and Joe Rand of Howard Hanna-Rand Realty – both were a fountain of terrific insights. It’s the second rodeo for me on a HGAR webinar and it was just as fun and engaging. Truly. The comedic high point was Joe’s cup of water/sand reference which was brilliant and I plan to steal it.

This Week in Aspirational Pricing: $190M Manhattan Condo

It was just another day in Manhattan and another bonkers sales price. The $190 million condo sale at 220 Central Park South was not a record since that was achieved a few years ago in the same building for $239,000,000.

Scoop-Mavens for price records Kathy Clarke and EB Solomont at the WSJ reported this sale just closed and it was a flip! The seller bought the unit for $93,000,000 ($9,490/SF) two years ago and resold it for $190,000,000 which was $19,388 per square foot. That is starting to make Ken Griffin’s $239,000,000 sale at $10,420 per square foot look like a deal, no? On top of it, there was a prior bonkers resale for $157,500,000 ($13,269/SF) back in June 2021.

This super-luxury market really has nothing to do with mere mortals like us.

Getting Graphic

My favorite charts of the week of our own making

My favorite charts of the week made by others

Len Kiefer‘s Chart Handiwork

Appraiserville

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

Who’s The Real Quack Here?

When someone shared this headline with me in Realtor Mag, I became quite irate. I don’t like cheap shots against our industry.

I immediately came up with alternative passive-aggressive headlines:

Are Appraisers Smart or Absolute Morons?
Are Appraisers Honest or Sniveling Liars?
Are Appraisers Trustworthy or Steal Lunch Money From Small Children?

Good grief.

So I reached out to people I know and respect on the NAR appraisal board to complain. They shared their concerns to Realtor Mag and the silly headline was removed. Most people don’t realize that the editors tend to control the headline copy, not the authors. I believe that was the story in this case.

It was very refreshing to see NAR’s Realtor Mag modify the headline almost immediately and that the appraiser board was very reactive. They really are working hard for the industry’s benefit.

However, I went back to the headline and the article today as I write this and the “Quack” reference was back! I’ll follow up!

Phil Crawford’s Podcast Is Back With A Sex Panther Analogy

There are some things you just need to hear, like the rain pounding against a window, the rustling of leaves, or Phil Crawford’s smooth silky voice bringing back the Sex Panther analogy into insightful discussions about our profession.

I have it on good authority that there are several blockbuster Voice of Appraisal episodes in our new future.

Dave Bunton of TAF Is Super Excited About That New USPAP Course!!!

(See if you can read the following run-on – but true – sentence out loud in one breath)

I mean, the original version of the USPAP course we are forced to pay for every two years with only 20 minutes of new content yet much of what is “new” is actually undoing previous necessary changes because they weren’t fully thought out, is just an absolute dream to every appraiser I speak with who is dying to be sponged unnecessarily so TAF can achieve its Vision 2030 thing to achieve financial independence as a not-for-profit and turned down a grant from ASC to make USPAP free for appraisers because TAF would rather soak appraisers unnecessarily so they can achieve their financial independence on our backs and travel to exotic locations like Dubai and Palm Springs to do busy work for no productive reason despite this process damaging the public trust. (gasp!)

And one of their quotes, from someone who makes their living from teaches these courses (Warren Buffet said “Never ask a barber if you need a haircut.”) and apparently doesn’t have a last name or is ashamed to share it or is a totally made up endorsement, exclaims:

“Students loved the Case Studies. One student asked me to tell you that in all the USPAP classes they had ever taken (over 20 years) this was the first that actually showed how USPAP could be used to answer everyday questions they get from lenders and clients.”
– Joanna [No Last Name], Certified USPAP Instructor

Joanna [No Last Name] is basically saying that the course hasn’t been effective for at least twenty years and now it is! Yay! Exciting, right! Remember that this course was pushed out there by the same people that wrote this bat-shit crazy letter.

OFT (One Final Thought)

I’ve long used the phrase “apples and oranges” in my appraisal duties when describing bad comparable sales, but I’ve never done it on acid (I’ve never taken any drugs for the record).

Dick Clark asked Pink Floyd to be on American Bandstand in 1967. That guy was way more forward-looking than he got credit for.

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 be from Finland;
– You’ll be more apples then oranges;
– And I’ll find that perfect comparable.

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.

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

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