I’m no market bear but the chronic lack of supply and surging prices in the national context doesn’t match wage growth and can’t be sustainable – but more importantly this week I turned 60 and our appraisal company Miller Samuel turned 34 so there’s that. Plus we all need to take a time out and watch goats.
You didn’t know you needed 15-seconds of baby goats jumping-around today — but you did… pic.twitter.com/Z7Jp69q9qP
— Rex Chapman???????? (@RexChapman) September 30, 2020
But I digress…
New Signed Contracts Remain Very High But Appear To Be Plateauing
These monthly regional reports break out each market’s performance by eight price tranches on a year over year basis and are a supplement to our quarterly market report series.
Elliman Report: New York September 2020 New Signed Contracts Report
While new signed contract activity remains below year-ago levels, remaining the outlier for the region, overall listing inventory gains of all three property types slowed. Their combined total rose only nominally year over year.
The new signed contract total of all three property types exceeded the prior-year level again but appeared to be plateauing. New listings continued to rise as sellers are looking to take advantage of the spring demand surge.
Long Island (excluding H/NF)
New signed contract activity for single family and condos continued to be significantly higher than year-ago levels, but growth appears to be plateauing. Some of the largest year over year gains in new signed contracts were occurring above the $300,000 threshold for single families and above the $400,000 threshold for condos.
Single family new signed contract totals rose sharply as they have been since the spring with nearly double the prior year’s activity. Condo new signed contracts also continued to see a significant year over year gain. New listings across both property types have been rising quickly in response to considerable demand.
Single family new signed contract totals rose sharply year over year as they have been since the spring. New listings in the single family market rose annually at the same rate as new signed contracts.
New signed contracts for single family and condos remained at a substantially higher level than a year-ago but showed plateauing signs in recent months. The annual rise in new listings did not keep pace with new signed contracts for both property types over the same period.
New signed contract gains for single family and condos were higher than a year-ago but showed signs of plateauing in recent months. The annual rise in single family new listings did not keep pace with new signed contracts over the same period.
Single family new signed contract totals continued their significant upward pace, nearly four times the year-ago levels. Condo new signed contract activity more than doubled over the same period. New listings across both property types did not keep pace with new signed contract growth.
Elliman Report: Florida September 2020 New Signed Contracts Report
Palm Beach County
Year over year, new signed contract gains for single family and condos continued to remain well above year-ago levels. New listings for both property types entering the market were up only slightly over the same period.
Year over year, new signed contract gains for single family and condos continued to remain well above year-ago levels. The overall number of new listings for both property types entering the market remained similar over the same period.
Year over year, new signed contract gains for single family and condos continued to remain higher than year-ago levels. The single family new listings total remained similar to the prior year, while new condo listings entering the market fell sharply over the same period.
New signed contract gains for single family and condos continued to remain above year-ago levels. The overall number of new listings of both property types entering the market fell short of the prior year total.
Year over year, new signed contract gains for single family and condos remained slightly above year-ago levels. The overall number of new listings for both property types entering the market fell short of the prior year total.
Elliman Report: California September 2020 New Signed Contracts Report
Los Angeles County
Single family new signed contract activity gains remained above the $600,000 threshold as the new listings dropped sharply. While condo new signed contracts rose sharply from the prior year, condo new listings more than doubled over the same period.
Most of the single family new signed contract activity gains remained above the $600,000 threshold as the new listings declined sharply. Condo’s new signed contracts rose from the prior year, with most of the increases occurring above the $300,000 threshold.
San Diego County
New signed contract activity for single family and condos remained well above year-ago levels but continued to show plateauing in recent months. However, supply remained limited, with new listings falling to roughly half prior-year levels.
Elliman Report: Colorado September 2020 New Signed Contracts Report
New signed contract gains of both property types were nearly double the prior-year level, significantly outpacing the increases in new listings. While the excess demand partly caused by the spring market shut down has been largely satiated, the market remains considerably more active than the year-ago period.
New signed contract gains of both property types were sharply higher than the prior-year level, significantly outpacing the number of new listings coming onto the market. While the excess demand partly caused by the spring market shut down has been partially satiated, the market remains significantly more active than the year-ago period.
Manhattan Third Quarter Sales Still Down, Reflecting Contracts Signed During And Shortly After Lockdown
The Manhattan market still remained the laggard in the region. Listing inventory continued to climb, but remains short of the record set in Q1-2009 and the second-highest level seen in Q2-2009.
Elliman Report: Q3-2020 Manhattan Sales
[click to open Bloomberg article]
As you can see in the following screenshot of my spreadsheet, closed sales in the third quarter saw a larger year over year decline at lower price levels. This skew has been significant enough to cause top-line price trend indicators to rise year over year, yet MARKETWIDE PRICE TRENDS ARE NOT ACTUALLY RISING! The market has since pivoted as indicated by the New York New Signed Contract report presented earlier as the sub-$2 million market is showing more sales strength.
And total MANHATTAN inventory remains high…
MANHATTAN SALES MARKET HIGHLIGHTS
Elliman Report: Q3-2020 Manhattan Sales
Co-ops & Condos
‘This quarterly report largely reflects sales contracts that were signed during and after the COVID lockdown that ended in late June.”
– The COVID-19 market shutdown caused the number of sales to decline year over year by roughly half for the second straight quarter
– The largest annual decline in sales occurred in smaller apartments, skewing overall price trends higher
– The market saw the highest listing inventory total and slowest market pace since 2009
– Resale bidding wars fell to their lowest market share level in almost five years of tracking
– Coop average sales size expanded to cause median sales price to increase annually for the first time in three quarters
– Condo average square footage rose to its highest level in more than thirty years, skewing prices higher
– The longest average marketing time for new development in more than eight years
– The number of new development closings reached their highest overall market share of the past five quarters, exceeding the decade average
– The largest year over year decline in luxury listing inventory in nine years
– The share of resale and new development sales nearly split the luxury market
NORTHERN MANHATTAN SALES MARKET HIGHLIGHTS
Elliman Report: Q3-2020 Northern Manhattan Sales
“The number of sales remained well below year-ago levels as the market climbed out of the spring lockdown.”
Co-ops & Condos
– The number of sales fell year over year at the highest rate in fifteen years
– Listing inventory reached its highest total in twelve years of tracking
– Sales rebounded slightly from the prior quarter but remained well below year-ago levels
– Highest market share of Manhattan townhouse sales in nearly three years
The 200-Year History of U.S. Interest Rates
The website Visual Capitalist is a terrific place to seek out economic context.
Downtown Josh Brown Is All In On The Housing Market
Just What My 200-Year-Old Historic Home Needs
— Cory Doctorow #BLM (@doctorow) September 29, 2020
Yahoo Finance VIDEO California’s Housing Market Remains Strong Despite Fires & Covid
Lack of supply is where the greater concern is.
California’s housing market is responding to growing demand and low inventory, says Jonathan Miller, CEO of Miller Samuel. He spoke with Yahoo Finance’s Alexis Christoforous and Brian Sozzi on Yahoo Finance TV
My favorite charts of the week
From my friend Mike Simonsen over at Altos Research…
Why we're unlikely to see a lot of foreclosures despite 4 million mortgages in forebearance.
US Active Inventory of single family homes for sale down to 568,000(!) down another 1% this week. pic.twitter.com/SkiK1uSIS2
— Mike Simonsen ???? (@mikesimonsen) September 28, 2020
Upcoming Speaking Events
Really looking forward to this one. You can register here or click on the image to go to the registration landing page.
(For earlier appraisal industry commentary, visit my old clunky REIC site.)
Slandering Appraisers: A Cincinnati Real Estate Broker May Be Both A Fool And A Tool
Real estate broker Karen Schlosser provides videos to her customers as part of her Tech Tool Monday Series.
She recently promoted her video called “Fool The Appraiser” – a catchy marketing phrase to promote dishonesty. She literally has no idea how offensive this is to the appraisal industry and how unprofessional this makes her look to the public and her peers.
From the transcript of her video:
So, the purpose of the game is to fool the appraiser into thinking that the property is worth the agreed upon purchase price.
I wonder if anyone at the National Association of Realtors has seen this marketing strategy since it may violate NAR’s Code of Ethics and Standards of Practice of the National Association of REALTORS®? She sent out fliers to the brokerage industry touting her “Fool the Appraiser” video. You can do that yourself by clicking on this link.
Standard of Practice 15-2
The obligation to refrain from making false or misleading statements about other real estate professionals, their businesses and their business practices includes the duty to not knowingly or recklessly publish, repeat, retransmit, or republish false or misleading statements made by others. This duty applies whether false or misleading statements are repeated in person, in writing, by technological means (e.g., the Internet), or by any other means. (Adopted 1/07, Amended 1/12)
Standard of Practice 15-3
The obligation to refrain from making false or misleading statements about other real estate professionals, their businesses, and their business practices includes the duty to publish a clarification about or to remove statements made by others on electronic media the REALTOR® controls once the REALTOR® knows the statement is false or misleading. (Adopted 1/10, Amended 1/12)
Here is the webinar handout. Clueless.
Her lack of judgment and professionalism is stunning whether or not she is good at selling properties.
OFT (One Final Thought)
Everyone needs to lighten up every so often.
Garbage men taking a break. pic.twitter.com/zk3OYfEqVh
— You Had One Job! (@_youhadonejob1) October 1, 2020
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 boom;
– You’ll zoom;
– And I’ll watch goats.
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
- Visualizing the 200-Year History of U.S. Interest Rates [Visual Capitalist]
- The Stages of Gentrification, as Told by Restaurant Openings [Eater]
- New Paltz, N.Y.: Beautiful, Sporty and Cultured [NY Times]
- The Coming Psychological Revolution in the Housing Market [A Wealth of Common Sense]
- Why the real estate boom could keep going for years [Axios]
- What Can Replace the Economic Output of Cities? – The Big Picture [Ritholtz]
- Apartment Hunt, 2020 [New Yorker]
- Mortgage Refinancing Boom Is Too Automated [Bloomberg]
- Apartment Conversions at All-Time High in the US [Rent Cafe]
- The Suburban Housing Boom is Just Getting Started [The Reformed Broker]
- Knock Knock. Who's There? Opendoor. [Not Boring]
- Use the Renter’s Market to Your Advantage [NY Times]
- Destruction of value in US real estate revealed [Financial Times]
- The Forgotten Front Porch Is Making a Comeback [Wall Street Journal]
- Carmel Partners Sells Norwalk Rental Valued At $157M [The Real Deal]
- Zillow Launches Residential Brokerage for iBuying [The Real Deal]
My New Content, Research and Mentions
- Hamptons Area Sees Rise in Housing Activity Across All Price Points [Mansion Global]
- LI housing market remains strong for high-end homes, report shows [Newsday]
- Sales of Manhattan co-ops and condos plunged by nearly half—again [Brick Underground]
- Real Estate Sales Continue to Stagnate in Manhattan [NY Times]
- Goldman CEO Solomon Pulls in $26.5 Million With Aspen Home Sale [MSN]
- COVID Fuels Palm Beach County Real Estate Sale Contracts [BocaNewsNow.com]
- South Florida Resi Contracts Rise In September [The Real Deal]
- New report shows higher single-family real estate demand [westfaironline.com]
- Single-Family Home Demand Increases North of New York City [The Real Deal]
- Manhattan Home Sales Continue Freefall in Q3 2020 [The Real Deal]
- Manhattan Condo Gross Sales Tumble 46%, Leaving 10,000 Unsold Flats [News Zada]
- Manhattan apartment sales tumble 46%, leaving 10,000 unsold apartments [CNBC]
- Despite Covid-19, top-end Aspen real estate is selling at a pace [Business Live]
- Manhattan Sales Prices Rose in the Third Quarter, Driven by Luxury New Developments [Mansion Global]
- Goldman CEO Solomon Pulls in $26.5 Million With Aspen Home Sale [BNN Bloomberg]
- Goldman CEO Solomon Pulls in $26.5 Million With Aspen Home Sale [Bloomberg]
- 曼哈顿三季待售公寓库存创11年新高 平均9折出售 – 雪花新闻 [Xuehua]
- Pandemic Special: “Don’t Pay Rent Until 2021” For NYC Apartments [Nation and State]
- Manhattan Homebuying Market Echoes 2009 With Inventory Pileup [Bloomberg]
- Manhattan Landlords’ Latest Lure: Free Rent Until Next Year [Bloomberg]
- 'There Is Blood In The Streets' In Manhattan's Luxury Apartment Market [Bisnow]
- Hamptons Home Sales Continue to Surge [The Entrepreneur Fund]
- Apartment Startup Common Bets on Expansion Despite Pandemic [Wall Street Journal]
- ‘We’re at War’: New York City Faces a Financial Abyss [NY Times]
- These neighborhoods had the biggest rent drops since March [6sqft]
- The Cracks In New York City's Multifamily Market Are Widening [Bisnow]
- Easy methods to Negotiate With Your Landlord [The Commercial Real Estate News]
- How to Negotiate With Your Landlord [NY Times]
Recently Published Elliman Market Reports
- Elliman Report: Manhattan Sales 3Q 2020 [Miller Samuel]
- Elliman Report: Northern Manhattan Sales 3Q 2020 [Miller Samuel]
- Elliman Report: New York New Signed Contracts 9-2020 [Miller Samuel]
- Elliman Report: Florida New Signed Contracts 9-2020 [Miller Samuel]
- Elliman Report: California New Signed Contracts 9-2020 [Miller Samuel]
- Elliman Report: Colorado New Signed Contracts 9-2020 [Miller Samuel]
- Elliman Report: Manhattan, Brooklyn & Queens Rentals 8-2020 [Miller Samuel]
Appraisal Related Reads
- Crazy contracts & condos are less popular [Sacramento Appraisal Blog]
- Appraisal Forms Redesign – What's Coming Down the Track? [Dave Town/Appraisers Blogs]
- Statutes of Limitations for Appraiser Negligence – Christensen Law Firm [Valuation Legal]
- TAF Diversity & Inclusion Subcommittee. Actions Speak louder than Words [Jonathan Miller/Appraisers Blogs]
- Is a Model Home Considered Occupied or Vacant? [Appraisers Blogs]
Extra Curricular Reads
- Rogue Signs Reveal Hidden History of Washington Heights [Untapped New York]
- New Study Finds No Direct Link Between Subway & COVID-19 Spread [Gothamist]
- Sophia Farrar Dies at 92; Belied Indifference to Kitty Genovese Attack [NY Times]
- Modest Mouse's Great American Album is 20, but it hits harder now than ever. [Stereogum]
- The Rise and Fall of the National Hollerin' Contest [Atlas Obscura]
- Wall Street’s Best-Kept Secret Is a 72-Year-Old Russian Chess Expert [Bloomberg]