Manhattan Housing Must Be In The Front Row

With the recent resurgence of the Manhattan housing market as illustrated in our market research presented later, the idea of never-ending optimism and the skill of being oblivious to the way of the world outside NYC should not be lost on us. Die-hard New Yorkers’ (self-included) confidence in the city’s future is something outsiders don’t fully appreciate and yet it is magic. The disconnect on the resilience of the city continues despite being shown over and over again that it’s a real thing. I think Bob Uecker‘s humor that combines optimism and being oblivious speaks volumes about this. Plus, the guy always made me laugh.

But I digress…

The Manhattan Sales Market Is Nearly Back (Even Before Office Workers Are)

I’ve been the author of the expanding Elliman Report series across the U.S. for Douglas Elliman Real Estate since 1994 – our the first effort began in Manhattan and it continues to enjoy a lot of interest given the high level of property prices and focus of global events such as 9/11, The global financial crisis and now COVID-19. In the early days of the pandemic lockdown back in late March 2020, the doom and gloomers were everywhere, culminating in the dumbest op-ed I’ve ever read: New York City is dead forever.

As it turns out, all the stories on migration, i.e., “fleeing the city” or “exodus,” didn’t understand the math. When looking at population moves, net migration is defined as “inbound versus outbound.” Still, there was little “inbound” in the pandemic because the city was perceived as unsafe and singled out as a global COVID hotspot. In reality, the city didn’t start seeing inbound begin in large numbers until vaccine adoption took hold earlier this year. Even with only 70% of New York State vaccinated, corporations not calling back employees until September, international travel restrictions, home buyers are clearly anticipating a wind-down of the nightmare with bidding wars returning to normal levels and tenants enjoying sharply discounted (but no longer falling) rents.

The NYC budget was made whole, and then some, by federal stimulus, 30-year mortgage rates sitting below 3% and additional billions in economic stimulus will be coursing through the region and count.

Bloomberg News created two charts(!!) for their Manhattan coverage: NYC Apartment Buyers Emerge From ‘Coma’ to Drive Record Sales, which in the past hour (as of this writing) was the 8th most read by the 350± Bloomberg Terminal subscribers.

And here is one of our charts based on the Q2 report results:


Elliman Report: Q2 2021 Manhattan Sales

Co-ops & Condos
“The market approached robust conditions with rising prices, surging sales and more bidding wars.”

– Median sales price rose to its highest level in eight quarters, the sixth-highest result in thirty-two years
– The number of sales surged to its highest quarterly total in six years as cash buyers returned
– The market share of bidding wars rose to normal levels but was the highest observed in two and a half years
– Resale median sales price rose to the highest on record since tracking began in 2003
– The number of co-op sales surged annually at the highest rate in more than eleven years
– The year over year surge in condo sales overpowered listing inventory gains, making the market pace much faster
– Luxury listing inventory rose year over year at approximately one third the rate of non-luxury supply
– The number of new development sales surged at the highest year over year rate in more than seventeen years of tracking
– There were the most new development sales above the $3 million threshold in two years


Elliman Report: Q2 2021 Northen Manhattan Sales

“The number of sales surged year over year, outpacing the growth in listing inventory.”

Co-ops & Condos
– The number of sales nearly doubled from the year-ago quarter, outpacing listing inventory growth
– The average sales size jumped year over year, pushing price trend indicators higher

– The number of sales nearly doubled from year-ago levels as price trends showed mixed results
– Listing inventory nearly doubled to match sales gains as marketing time expanded

Suburban Sales Are Moderating As Buyers Take A Breath

About a year ago during the pandemic, I created the monthly new signed contract report series for Douglas Elliman. It turned out to be a big hit with real estate market participants in the four regions we cover: New York, Florida, Colorado and California. It’s a monthly series that breaks out the market by eight price tranches and property types. Think of it as a gut check on market activity.

Bloomberg News took a look at New York City Metro Area results that shows that new signed contract volume is moderating (300-400% YOY sales growth clearly isn’t sustainable). The ±350K Bloomberg Terminal subscribers made it their 15th most-read article of the morning.

Plus there is a super cool chart that shows it visually.

New York New Signed Contracts Report

Elliman Report: New York June 2021 New Signed Contracts Report

– The New York report attached covers Manhattan, Brooklyn, Long Island, Hamptons, North Fork, Westchester County, Fairfield County, and Greenwich, CT.

Florida New Signed Contracts Report

– The Florida report includes the counties of Miami-Dade, Broward, Palm Beach, Pinellas, and Hillsborough.

Elliman Report: Florida June 2021 New Signed Contracts Report

Colorado New Signed Contracts Report

– The Colorado report covers Aspen and Snowmass Village.

Elliman Report: Colorado June 2021 New Signed Contracts Report

California New Signed Contracts Report

– The California report contains the counties of Los Angeles, Orange, and San Diego.

Elliman Report: California June 2021 New Signed Contracts Report

After A Wild Ride In 2020, Seasonality Trends For Manhattan Listing Inventory Is Returning

I love this chart. As you can see in every year since the financial crisis, 2020 was the outlier. Seasonal patterns rule no matter how weak or strong the market is, unless there is a global pandemic.

[click image for supersized version]

Illustration: Cities Give Up A Lot Of Space To Cars

I love this!

Aspirational Pricing Returns To Super Luxury

With the news that resales at 220 Central Park South are going for more than their original purchase price of 5-6 years ago, the fever to wildly overprice super luxury may be making a comeback. The thing is, 220 Central Park South is directly on Central Park and an argument can be made that it’s not part of Billionaires’ Row.

The top floor (96) unit at 432 Park, one of the buildings in a group collectively known as “Billionaire’s Row,” closed in 2016 for $87,660,898.12 (I love that the purchase price came down to pennies at this price point.

Upstart brokerage Serhant led by Million Dollar Listing broker Ryan Serhant, got the listing and the price is a doozy. The property was listed for $169 million (or $170 million), roughly double the previous purchase price. Sandy Weill did this in 2011, pricing PH20 at 15 CPW at $88 million after buying the unit 5 years earlier for $44 million. Many chuckled at the new price until it sold. I contend that the sale started the “aspirational pricing” phenomenon in the U.S. that ran from 2013 to 2018. But the $88 million price was part of a series of purchases by a Russian oligarch, supposedly shielding cash in large U.S. transactions as a cover for a multi-country divorce action. But still, Weill got the money.

In Cities, Noise Is All About Cars and Traffic

There are other solutions in addition to cars. Here’s a global take.

Ritholtz Gives A STFU To Inflationistas: ‘Deflation, punctuated with spasms of inflation’

My friend Barry Ritholtz brings peace, love and understanding to the inflation discussion. The entire thread is a great read.

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


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

Stereotypical Appraisal Article Title Made Me LOL

I thought my Appraiserville readers would need a little levity before you delve into the next post.

The following article in WorkingRE is the most LOL appraisal/inspector article title I’ve ever come across:

Stone Veneer: Friend or Foe? The Science Behind Your Inspection

In fairness, I haven’t read the article yet because I can’t stop laughing every time I see the “Friend or Foe?” title.

It’s been a long week…sigh.

The Hateful 8: The Appraisal Institute’s Sham Petition Process Is A Setback To Diversity Efforts

I’ll get into “why” this situation is both ironic and corrupt but first, some background.

Current AI president Rodman Schley has been one of the few leaders in AI to challenge the organization’s efforts and noticeably step up its attention to diversity – he has been quite outspoken on this issue in the U.S. media this year but it’s only a start. I believe one of his main passions is to restore the Diversity Panel to its former status as a Diversity Committee with a budget and organizational power by reporting directly to the Board of Directors. As a panel in name only, it theoretically reports to Jim Amorin and he gets to decide whether anything goes in front of the board of directors. It basically can’t do anything as an entity.

The Sham Petition Process employed last year and failed, polarized the board, and current president Rodman Schley spent a lot of time try to heal the divide and gel the group. That effort was obliterated with last week’s return of the sham petition process, echoing last year’s effort by FOJs. Essentially the current AI president was knifed in the back by these 8 FOJs.

This is a textbook case of how authoritarians amass power in institutions. They find people who can’t think independently, miss essential critical thinking skills, and simply follow the leader. I don’t know whether Jim Amorin was a good appraiser, but I do know from his actions that he has both an excellent authoritarian skill set and affinity to take over over an institution.

Back in 2015, Bob Stevens, a well-regarded member, was the chairman of the Diversity Committee, doing good work and starting to make some noise. This was a threat to Jim Amorin’s power. Bob was not an FOJ (Friends of Jim Amorin), so Jim scuttled the Diversity Committee by relegating it to a panel that reported to him only – this was essentially the death knell of any real diversity efforts within the organization. In this era of media scrutiny, the current CEO of the Appraisal Institute crushed the existence of a diversity committee six years ago.

The lack of diversity efforts and the “middle-aged-white-guy” dominance of the appraisal profession and within key industry institutions such as the Appraisal Institute and The Appraisal Foundation makes our appraisal industry highly vulnerable. This makes Rodman Schley’s effort to upgrade the Diversity Panel back to a Diversity Committee all that much more critical given the current media circus against an industry that has no credibility on the topic of diversity in the eyes of the public because our leadership is not diverse.

Here’s where it gets ironic and oozes anti-diversity in the currently deployed sham petition process. There were 8 signers of the sham petition that was presented to their leader Jim Amorin last weekend in the 11th hour to blindside non-FOJs. This process was originally designed to let FOJs bypass the NNC (National Nominating Committee), who had already vetted all the nominations from the various regions of the Appraisal Institute. As I said last week, the vast amount of time and energy employed in this process by 10 NNC volunteers can not be understated. Who wants to be on the NNC when FOJs bypass the thoughtfulness of the process and the members? Remember, the sham petition process was inaugurated by the older members of the FOJ regime years ago.

Incidentally, 6 of the 8 FOJs on the Board of Directors that signed the sham petition include all the women of the BOD and a gay man, representing broad population cohorts that have been the victims of oppression for as far back as memories can take us.

The NNC selected Steven Stiloski, who is not an FOJ. But, unfortunately, the sham petition process places the thoughtfully vetted selection by NNC on equal footing with the backroom dealings of FOJ sycophants. I just want to point out again, like I did last week, that he, like Craig Steinley last year, was on the audit committee and likely why Jim Amorin has pushed back hard by employing the sham petition process for the second year in a row because Steven can shine a light on the dark financial places in the operation.

These 8 individuals are FOJ sycophants – some useful alternatives to “sycophant” are below.

The “Hateful 8” signers of the sham petition process to bypass the recommendations of the membership and the NNC to vote for are:

– Trevor C. Hubbard: Region VII Chair, ring leader, and uber FOJ
– Claire M. Aufrance: FOJ Region V Chair
– Heather Placer Mull: FOJ Region V Vice Chair
– Paula K. Konikoff: FOJ Region VII Vice Chair
– Linda M. Powers: FOJ Region VIII Chair
– Elaine Liz-Ramirez: FOJ Region X Chair
– Lindel D. Schulze: FOJ Region II Vice Chair
– James T. Ferstl: FOJ Region IX Chair

The act of enabling the sham petition process makes them an FOJ whether they are servants to Jim Amorin or not. Yet these people represent members around the country but they:

– Voted specifically to ignore the membership they represent as region chairs and vice-chairs.
– They are fine with all regional contact data being scrubbed from the AI website because it makes it much harder for members to provide feedback to leadership on the sham petition process – Jim Amorin controls the website and could restore that contact information in five minutes if he chose to.
– They all know that AI membership has not been told that another round of the sham petition process is being employed like last year, all to keep Jim Amorin in power and shower the benefits he now controls to each of the 8 personally at the expense of the integrity of the organization.

They probably voted for FOJ Sandra Adomatis because she fits the bill as a non-male non-commercial appraiser unlike the vast majority of past/current leaders – you know, “diversity!” It is quite astounding that 8 professionals, with 6 of them representing oppressed groups (women/gay), would vote for an FOJ because she happens to be a female residential appraiser, over the thoughtful vetting of the NNC. All the while knowing that such an FOJ selection would kill Rodman Schley’s efforts to re-establish the diversity committee.

Remember that Sandra was one of the candidates vetted by NNC and was NOT selected as the top candidate by NNC.

Surprisingly, even board member Super Duper FOJ Jody Bishop, who I understand has been an advocate for diversity, loses here with this FOJ choice.

It’s easy to see that the end game here is to continually overturn the NNC process such that no decent person would want to serve on it or be vetted, as it’s a waste of everyone’s time while their honor is constantly being called into question.

Then who picks the candidate for VP? Does the Board choose the VP? Does not one see the inherent conflict of interest in all of this? It just screams tyranny.

Are these 8 FOJs suggesting by their use of the sham petition process that the NNC is biased against women, which is a pretty damning assertion – one that the Board of Directors better be able to back up. What is the actual reason the sham petition process was employed this time other than for advancement and compensation of these FOJs under the current CEO?

This is Jim Amorin’s last gasp effort to remain in power. If the sham petition process is successful (and the current board votes are closer than last year’s sham petition process efforts), Rodman Schley’s efforts to start to bring credibility back to the Appraisal Institute dies a sad death, and his legacy of bringing change to the institution will brand him as an ineffective leader.

Several MAIs have indicated that they will resign if this sham petition process is successful this time around. In addition, members tell me there has been a noticeable dilution in the value of the MAI designation during the Amorin era.

As I mentioned last week, the Appraisal Institute scrubbed their website of all Chapter links and contact data and any Regional data to make it more difficult for dues-paying membership to organize against the sham petition process this time.

My readers need to get the word out to the membership that the sham petition process is underway for the second year in a row. This is a blatant institutional takeover for financial gain. How are the authorities not looking at this?

OFT (One Final Thought)

I have a ton of old blues music from all the names you might be familiar with such as John Lee Hooker, Muddy Waters, Lightnin’ Hopkins, Robert Johnson, Howlin’ Wolf, etc. – Afterall, it’s the precursor to rock and roll. But for some reason, Big Bill Broonzy strikes a chord (no pun intended). Here’s a fun clip, the year before he died of throat cancer. I love this.

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 more optimistic;
– You’ll be more oblivious;
– And I’ll strike a chord.

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
Miller Samuel Inc.
Real Estate Appraisers & Consultants
Matrix Blog

Reads, Listens and Visuals I Enjoyed

My New Content, Research and Mentions

Recently Published Elliman Market Reports

Miami Condo Collapse

Appraisal Related Reads

Extra Curricular Reads