Lets Stick To Housing Because This Gamestop-Robinhood-Reddit Thing Is Too Confusing

One of my gamer-inclined sons sent me this link yesterday and told me “don’t mess with memers and redditors” and I listened.

This relevant and epic piece on Matt Taibi’s substack lays out one perspective “Suck It, Wall Street” and Andrew Ross Sorkin & Co’s “How Does This End?” in The New York Time’s Dealbook takes us down the rabbit hole. But in all cases I’m rooting for the little guy on Main Street. And don’t ask me to explain SPACs.

Here’s a quicker explainer:

And another (NSFW):

But since I don’t really understand the nuances of all this, I’m going to stick to what makes obvious sense to me: A massive U.S. housing boom with record prices and sales volume against the backdrop of a global pandemic.

So I’ll gladly digress…

The Hamptons Market Soared Like A Coprimary Rocketship

I’ve been the author of the expanding Douglas Elliman market report series since 1994. As I began to cover the Long Island market years ago, it was clear that the East End was joined at the hip with Manhattan and the securities industry. But the housing boom the city enjoyed wasn’t transferred to the East End of Long Island like one would expect although it was part of the remainder of Long Island. Our chart below illustrates how the post-financial crisis pairing broke mid-decade and then the city’s development boom left the Hampton’s behind until the global pandemic. Coprimary is my word to describe the phenomenon where second home housing markets become viewed as a primary or an alternative primary market, largely enabled by the proliferation of remote work during the pandemic.

Normally this type of report result for a Wall Street-centric audience would normally rank high on the Bloomberg Terminals but this week it failed to make the top 20 most read upon its release since all the stories seemed to be related to Gamestop.

Since charts tell a better story than I ever could the Bloomberg coverage of this coprimary trend had some excellent visuals.


“With falling supply and surging sales, and aided by record-low mortgage rates, the market pace was the fastest recorded since at least 2007.”

– Median sales price reached a new record for the second straight quarter after fifteen years of tracking
– Sales surged annually at the highest rate in a decade to the most quarterly sales in at least fifteen years
– Listing inventory fell year over year for the fifth consecutive quarter
– Highest market share of bidding wars in nearly five years of tracking


“With falling supply and surging sales, and aided by record-low mortgage rates, the market pace was the fastest recorded since at least 2007.”

– Median and average sales price set new records during fourteen years of tracking
– The largest annual surge in sales on record and the largest sales total since at least 2006
– Listing inventory fell to a fourteen-year low and the fastest market pace recorded in fourteen years
– Highest market share of bidding wars in nearly five years of tracking


“With falling supply and surging sales, and aided by record-low mortgage rates, the market pace was the fastest recorded since at least 2003.”

– Average and median sales price surged annually to set new records
– The number of sales jumped annually to the highest quarterly total in eighteen years
– Listing inventory fell sharply year over year to the lowest level in seventeen years
– Single family average and median sales price rose sharply year over year reaching new records
– Condo average and median sales price surged annually to set new records
– The fastest paced luxury market in nearly twelve years of tracking

The Economy Began To Run Out of Gas in Q4

This New York Time’s piece: Frail at Year’s End, Economy Looks for a Second Wind. I found the following charts a bit ironic showing the tepid 1% year over year GDP growth given how strong the housing market is for one-percenters.

With the delay in fiscal stimulus during the COVID crisis, the economy is slowly cooling, but housing seems to be oblivious due to record-low mortgage rates, especially the skew to the higher end properties. However, with the potential for another stimulus package, it looks like there could be some sort of economic upswing in 2021, and that should also benefit the U.S. home sale market.

The slump “wasn’t just Covid — it was the lack of fiscal support,” said Aneta Markowska, chief financial economist at Jefferies, an investment bank.

This is why the performance disparity between the rental market and the sales market is so huge:

“It’s the tale of two economies,” said Constance L. Hunter, chief economist at the accounting firm KPMG. Workers who have been relatively unscathed by the recession are eager to resume spending as soon as the public health situation allows. But for the worst-hit groups, she said, “there is significant economic scarring potential.”

Los Angeles Upper-End Housing Market Musical Chairs Benefits From Record Low Mortgage Rates

From the Mansion Global coverage: “Rising prices are in some ways a factor of buyers closing on larger houses”


“For the fourth consecutive quarter, median sales price rose to a top-three record, despite the pandemic, as the market shifts to larger sized sales.”

– Median sales price jumped year over year to reach the second-highest level of all time
– Sales rose sharply year over year for the fourth time in five quarters
– Average sales size edged higher to the largest square footage on record
– Listing inventory expanded year over year for the second straight quarter after the lockdown ended
– Single family median sales price rose year over year to the third consecutive quarterly record
– Luxury single family median sales price, representing the top ten percent of sales, rose annually for the fourth consecutive quarter


– Malibu single family average sales size continued to set to a new record square footage, driving median sales to set a record as well
– Malibu Beach condo sales size surged to their largest average square footage in more than four year

– Venice single family average sales size jumped to a new record square footage, driving median sales to a record as well
– Mar Vista single family average price per square foot jumped to a new record

Superstar Cities Are Lifestyle Cities And Won’t Likely See Much Damage From The Remote Work Phenomenon

Matthew Yglesias recently left VOX to start his own Substack column “Slow Boring” to which I subscribe and highly recommend. I had linked out to this piece last week and it (the article, not me) seemed to inspire this Superstar Cities column.

Here are a few snippets within a long discussion that makes the point.

That’s because superstar cities are not the cities that are superstars. Instead, they are the cities that have a combination of high wages and high rents that cause them to be disproportionately home to labor market superstars. These are completely different ideas, and they mean that giant, awesome, “it would be cool to live here if it weren’t so damn cold” Chicago is not a superstar city, but the smaller, frumpier, also super-cold Boston is.

Matt Damon didn’t pay $17 million for an apartment in Brooklyn because he needs to be there for work. That’s not to say that more companies going remote wouldn’t change the city. Demand for office space will clearly fall, which will let some companies that are currently in New Jersey or White Plains move into the now-cheaper office space in Midtown. The long-term trend toward the Financial District having less office stuff and more residential stuff will continue. But fundamentally, while New York is not for everyone, the people who choose to live there love the lifestyle. There’s a reason super-rich people buy pieds-à-terre there, just like super-rich people buy ski houses in Aspen.

Recall, again, LeBron signing with the Heat. People have been going to Miami for fun for a long time now. But unless you’re an NBA player, it hasn’t necessarily been a great place to find high-paying jobs. Remote work changes that.

HGAR VIDEO – Getting the Deal Done Series – The State of NY Real Estate: Setting Sights on 2021 + Beyond

I recently joined Bess Freedman, CEO of Brown Harris Stevens, and Joe Rand, Chief Creative Officer of Howard Hanna/Rand Realty for a discussion on the state of the market in NYC Metro – even got to talk about my favorite new phrases of 2020 such as “Coprimary” and “Peak Zoom.” Ha.

Here’s the press release from HGAR:

New York, N.Y. (January 22, 2021) – Top New York real estate leaders weighed in on the region’s residential market, from the latest prices in Manhattan to bidding wars in Westchester, and shared strategies for how Realtors can take advantage of the current dynamics, at a virtual panel Jan. 22 hosted by the Hudson Gateway Association of Realtors, Inc. (HGAR) and OneKey™ MLS.

Hundreds of industry professionals tuned in for “Getting the Deal Done: The State of NY Real Estate: Setting Sights on 2021 + Beyond,” which featured Bess Freedman, CEO of Brown Harris Stevens; Jonathan Miller, President and CEO of Miller Samuel Inc.; and Joe Rand, Chief Creative Officer of Howard Hanna/Rand Realty and Executive Director, Broker Public Portal.

“We’ve all had to pivot during the pandemic and we’ve seen tremendous innovation in our industry,” said Richard Haggerty, CEO of HGAR and President and Chief Strategic Growth Officer of OneKey™ MLS, the regional multiple listing service for New York. “Working together is key and we’re so pleased to have Bess, Joe and Jonathan here today to share best practices for the current environment and strategies for moving forward.”

The discussion was moderated by Brian D. Tormey, NTP, president of TitleVest, a leading New York City-based provider of title insurance and related real estate services. The hour-long session focused on market trends, new ways of doing business, the economic impact of the pandemic, patterns to watch in 2021 and whether stability is in sight for NYC.

“Look for a V-shaped recovery,” said Miller. “And by that I mean ‘vaccine.’ True stability doesn’t really happen until people feel safe.”

Miller pointed to trends in NYC’s rental market, noting pricing was down some 23 percent, but also saw an upside – more affordability is creating a “youth renaissance” in Manhattan’s rental space.

Freedman also noted the vaccine’s impact on the market. “Having the vaccine in sight is excellent,” she said. “The path forward is going to be a bit tough but at least we have some resolution.”
Freedman said she’s optimistic for 2021. “New York City is going to do very well,” she said. “It’s still a buyer’s market – an opportunity market – rates are low. But theaters are going to reopen, restaurants are going to reopen … I’m doubling down on my prediction for NYC in 2021.”

Rand discussed trends in pricing north of NYC and the types of properties being sold. “Covid is impacting pricing, in the short term, in two ways,” he said. “First, all that migration from NYC to the suburbs, those are higher-end buyers. So, the mix of properties being sold is skewing higher, they’re competing and pushing prices up. Also, the economic impact of Covid is disproportionately hitting lower-income people. And that’s really unfortunate … we should be doing more from a public policy standpoint to help people.”

“Getting the Deal Done” is part of the “Be Your Best” webinar series created by HGAR and OneKey™ MLS, to assist Realtors and agents during the Covid-19 pandemic. The event was sponsored by TitleVest.


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

Appraisal Buzzcast: Diving into USPAP with Jeremy Bagott and Dennis Scardilli

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Jonathan J. Miller, CRP, CRE, Member of RAC
Miller Samuel Inc.
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