But the median price declined. Households paying for office space to work from home?
By Wolf Richter for WOLF STREET.
This is a massive shift. It’s not that the numbers are huge – there are just not that many new single-family houses sold in the US. But the increases in sales are huge, and they’re becoming persistent.
Sales of new single-family houses, based on contracts signed in August, jumped by 45.6% year-over-year to 83,000 deals, not seasonally adjusted, matching July deals, and a notch above June deals (79,000), according to the Commerce Department today. All three of them were the highest monthly sales since April 2007, but still well below the peaks in 2004 through 2006:
The “seasonally adjusted annual rate” – the number of sales for an entire year if sales continue at the August pace – jumped by 43.2% to 1.01 million houses, the highest since the November 2006.
This makes for three months in a row of a sharp increase in sales, following a slow-down in sales that lasted only two months (March and April).
Supply of spec houses declines.
The number of speculative houses for sale (does not include houses that homebuilders built on order for a specific buyer) has been declining since March. In other words, homebuilders are selling down their inventory of spec houses. In August, the number houses for sale dropped to 282,000 (not seasonally adjusted), the lowest since 2017. Note the pileup of spec houses during the Housing Bust when demand vanished, even as home builders continued to build. This is not case during the Pandemic:
Given the higher rate of sales in August, and the lower inventory of houses for sale, supply fell to 3.4 months, the lowest since 2004.
Median price declines, remains in same range since 2016.
The median price of new houses sold in August fell 4.3% year-over-year to $312,000, and has been in the same range roughly for the past four years. The twelve-month moving average (red line), which irons out the month-to-month fluctuations, at $324,000, also shows that the median price has gone nowhere over the past few years:
The median price is influenced by the mix of houses sold. A declining median price doesn’t necessarily mean that homebuilders are cutting prices – though it could mean that too. Builders could just be targeting lower price points to meet consumer demand, or sales could have shifted to cheaper locations (more distant suburbs or lower-cost states).
The big shift.
There has been a pile of anecdotal and data-based evidence that a shift is taking place from some densely populated cities, and especially city centers, and especially from rental apartments, to houses a little further out, or in more distant suburbs, or to other towns in cheaper parts of the country. This evidence includes plunging rents and rising apartment vacancies in cities like New York City, San Francisco, San Jose, or Seattle. And part of this shift is showing up in the demand for new houses.
While this still could be just a blip, with people flocking back to city centers soon, as big-city landlords are hoping, it’s harder to write off as a blip after three months of soaring demand for new houses.
There are all kinds of explanations for this phenomenon: Working from home as a permanent feature for many employees reduces the issue of commutes; the virus makes high-rise living less than desirable and folks flee for the suburbs where it’s easy to social-distance; record-low mortgage rates and trillions in QE have unleashed a veritable land rush among the people who can buy; younger couples decide to start a family and need more space…
Oh, more space…
Now that working from home is a big thing for many office workers, a couple where suddenly both work from home is quickly finding out how tough that situation is in a one or two-bedroom apartment even if there are no kids present. If working from home becomes a permanent feature in their lives, they’ll look for more space.
Thereby, office space becomes one of the things that households are now having to consider spending money on. Purchases of office furniture, electronic devices, higher-quality broadband, software, coffee, toilet paper, food, etc. has already made that transition from commercial buildings to the home.
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Where there’s a need, the capitalist market will fill it.
The big home builders are already offering new home plans with office space. But…
For those already entrenched there are companies springing up to drop/build an office in your yard.
I know where I last lived you could build a 10×10 outbuilding without a permit. Perfect office away from “home distractions”.
And if you can’t easily have one of those, an 8.5×16’ cargo trailer can be customized into anything you want provided you have a place to park it.
Hoocudathunkit that a little chunk of errant DNA could upend the employment market so…
I got a small (19″ old cruise america) motorhome and parked it in the back. Makes a great home office which I use every day, and its nice for weekend camping trips too since Covid closed everything else.
We use it for grocery shopping too, it holds a lot and we can use our own bathroom to boot rather than the public ones :-)
Never thought that thing would be getting as much use as it does..
I like the idea of buying a small/medium size RV to use as an office.
It has a water, bathroom, sink, stove, electricity, and a bed for catnaps between Webexes.
To build a She-Shed/Man-Cave in the backyard with all of these amenities would require a permit and I suspect a higher cost. Though, if you did spend the money, you could probably rent it out as an Accessory Dwelling when Covid is over.
The nice thing about the “Mobile Office” RV is that you truly can drive anywhere and are all set up to work.
Coronavirus is RNA.
Then there’s also the HOA (or Body Corp in Aus) ongoing costs. Maybe people are starting to realize that the less fixed outgoings there are, the better. Cost control is going to get real important as effects of this rabid viral panic hysteria play out longer term. And, the benefits of not living in someone else’s face becomes more apparent. For young singles apartment living may be OK, but as one matures, one starts to become cognizant of the many many downsides.
I live in a condominium complex of 100 units in San Antonio. Many of them are empty and owned by Mexicans to park some money. I rarely see anyone outside in the common areas. I have absolutely no maintenance or yard work to do. I don’t know what all the hysteria is about. A house in the suburbs is the last thing on earth I want.
Wait until a family of 9 on Section 8 is placed next to your unit by a local government.
Will we see a reverse shift when vaccine is out, years after when people forgot about Covid19? Maybe in a decade, commercial real estate boom again, suburban hype back to normal.
Who would be foolish enough to take the so-called vaccine No thanks I will pass At least until it’s had time to be shown safe
People moving in an out of the cities is no different than in the past years.
See this Bloomberg article that’s has some good info, so what we are seeing with sales can’t be because people are moving out of the cities.
I think a more plausible explanation is that people see the writing on the wall will all the trillions being printed, money is dying and what better place to invest now than in a house.
You get the appreciation due to inflation and at the same time your loan will be worthless, it’s a double whammy.
Yes. There is something else going on. Of all the people I know in cities only one moved- out of NYC and she just moved back to NYC this month as rents went down. Where did the stimulus money go? Who did the banks give it to or did Blackrock give it to themselves?
” So far, there is little support for the dramatic claims that people are fleeing cities writ large. In fact, available data indicates that overall, fewer people moved at all since the beginning of stay-at-home orders and through June — even with interest in moving on the rise again […] A select few cities including New York City and San Francisco do seem to be seeing more out-migration than most. But guess where many of those people are going? Other very large metropolitan areas, like Seattle and Los Angeles”
Lynn,
Look at the surging vacancy rates in Manhattan and in San Francisco and elsewhere. These are renters that have already LEFT. Yeah, fewer people are moving because fewer companies are hiring and they’re NOT bringing the new hires in, but they’re keeping them remote, and few people need to move to get a job. So that dynamic of people not moving because companies are not bringing people in clouds the data of people leaving for reasons other than a job, and turns the Bloomberg article you cited into nonsense.
Meanwhile nyc is holding its breath…
I lived in Manhattan for 30 years… left in 2011…your comment provoked a favorite poem, by Frank O Hara:
Song (Is it dirty)
Is it dirty
does it look dirty
that’s what you think of in the city
does it just seem dirty
that’s what you think of in the city
you don’t refuse to breathe do you
someone comes along with a very bad character
he seems attractive. is he really. yes. very
he’s attractive as his character is bad. is it. yes
that’s what you think of in the city
run your finger along your no-moss mind
that’s not a thought that’s soot
and you take a lot of dirt off someone
is the character less bad. no. it improves constantly
you don’t refuse to breathe do you
That is a pretty phobic sort of song. Personally I can testify that though I left NYC 5 years ago my mind has not got cleaner. I suppose I am more relaxed about it though.
Or maybe it is about thoughts of money. I was never very greedy about money.
NYC excess density has always made for a poor quality of life for 85% of the population…who put up with it for better career opportunities…that only 15% really profit from.
In a great many ways, it is a 19th century city, straitjacketed by 19th century realities/assumptions that don’t really pertain much anymore.
The only thing keeping it alive economically is the hypertrophic finance concentration…ironically one of the industries easiest to disperse.
But NYC has remained locked into an economic Lord-Serf mentality/role play for decades and decades beyond it making any remote sense.
If Cuomo could squeeze the “rich” more (without triggering further flight, and therefore collapse) he would have done so long ago.
He has said as much.
Nobody goes to NYC anymore, its too crowded.
Harrold,
Look at population growth in NYC since about 1960 (relative to other US metros), and you will in fact find that NYC is pretty stagnant, relatively speaking.
NYC has had a bad rep for a long time and survived off the residuum of its former “greatness” – really just pre 1960 hypertrophy.
Kick out a fast fading few economic props (finance, media…heh, and corp HQs for lord-of-the-manor CEOs who pay more attention to Society Pages than bottom lines) and bad NYC can and will get much, much worse.
Cuomo knows this…otherwise he would have gassed up the expropriation tumbrel long before this.
But hey, if there were ever a city made to thrive in hard times thanks to socialist unity-of-mankind spirit, it has to be NYC…
That was a slight mis-quote from that late great Yankee Yogi Bera.
Straight outta college, I have friends bunking up as 4pp to live in a tiny apartment “in the heart of it all” in a major metro area.
Instead, I got my own place, 1.5 miles away, for what each of them paid to live on top of the others. I never minded the car, bike, bus, or walk to get to “the heart of it all”.
In return I had a 12×22 living room, galley kitchen, small DR, and BR big enough for a queen bed & 2 dressers. And it wasn’t tight. Plus… my own bathroom!
Those leaving the now socially dead cities will always be able to pop in for an evening, or even rent a hotel room for the weekend, when the ‘rona disappears.
And just like my big apartment post college, they’ll come to love their more spacious life.
some people LOVE people, though. there’s no “popping in” when you live there and help to make a neighborhood.
this makes me sad, your comment, because this is how i see the differences between us: some buy experiences some ARE the experiences, and the latter get exploited by the bored and uninspired former with all that open space of no ideas in their heads.
it’s a consumeristic vs collective issue and the turning point for how i see the future working out.
when you live on top of each other, you learn how to NEGOTIATE inside 400 sf of space during covid or being poor.
my mom was right when she warned me about being too cozy alone in my huuge sprawling philadelphia apartment with two floors and big old fireplace. she said people who spend too much time alone for too long become pinched, unflexible, lonely, particular, persnicketty, selfish, self-absorbed.
absolute HELL on road trip or when things get shaky like now.
as an artist trapped in a rent-controlled apartment i outgrew the moment i put a 3/4 bed in it, i long for a room of my own again but i love living with James in these 400 sf more than when i ever lived alone in a thousand.
i think this is true. it was hard for me to live cooped up with a crazy woman. I had to learn how to transform my rage into wisdom.
paul easton… FUNNY you say that… this is gonna get skinny:
so my elder/infirm neighbor who’s on his own with no gov’t help, he’s got people coming and going and trading for him. he’s doing business with everyone knows everyone new here and if they’re rude he hates ’em forever. i call him The Mayor or Godfather. for real. love that i get to live next to THIS.
he’s doing better than everyone, us all cut off from anyone each other alienated …ugh…
anyhow, this tech animation girl is at home all the time and she’s shredding her boyfriend so bad, James even said, “i don’t think they’re very nice to each other,” which is an UNDERSTATEMENT as he doesn’t talk about anyone’s business first of all.
so one day i’m out getting my sun and i hear her SHRED this poor little hipster boyfriend of hers, screaming like no one could hear a thing.
anyhow, it explains the dead vacant look in his eyes. these two are the second insane tech couple in the SAME apartment. last poor guy went insane babbling to himself up and down the street, saying to his nanny girlfriend who also trashed him in front of us, he said his company was spying on him through his phone and she laughed and he went MISSING.
still haven’t found his body.
so now this is the next insane tech woman and i see them outside my window and say to her, “hey, we don’t treat our men that way here. you two are inside a tiny apartment during covid and you can cause some eternal scars treating him that way at this magical time.”
her smile was frozen. she stared up at me with an expressionless smile because white girls are never told no.
but his look of wanting to fog up the non-existent car window with “HELP ME” is a sign of change in consciousness.
did i go off point here? it’s related somehow.
oh yeah. the pearl of suffering vs plain old self indulgent masochism.
again with my shrug. / YOU decide. i think it’s a bit of both. back to sex with me, right? but it’s true and know it and channel it for good or be channeled for whatever.
but use your masochism or sadism for good. what’s good? again with the shrug… what outcome you going for, right?
where’s Leonard when you really need him? /
x
I thought of that. The thing is she is built like a gorilla so the idea of rough sex either way is rather fraught.
She doesn’t yell at me. She doesn’t talk to me and if I complain she says Oh I don’t like to talk to people much.
What gets me mad is that she is completely unreliable. I never know how long she will stay or where she is when she is gone or when she will come back. I guess it is emotional masochism. I should get rid of her. Do you agree?
but i have to admit that i like her to be there. maybe it’s because of my love of animals.
“ this poor little hipster boyfriend of hers”
OUCH. I do hope SF and other cities get the artists back. I grew up outside Philly and we used to see Rocky Horror at this theatre on South Street, so much fun.
I moved to nyc from school and it was my home for most of the next 25 years. My first day I was randomly whacked on the head by a homeless guy on the subway, there was a garbage strike that summer and crack had created a lot of “no-go” zones. But it was fun – met so many interesting people with different perspectives and ideas. That’s part of the magic – but by the late 90s you could definitely feel the chill of winds of Capital remaking everything.
Follow the artists and free spirits, they make life better.
AS USUAL I BURIED MY LEAD:
YOU GOT IT TWISTED / you’re obviously elite and think others beneath your station are the only ones and the rest of us are the riff raff.
no. as i told Happy Man, WE ARE THE PRETTY ONES AGAIN, AS THE ONES LEAVING these “socially dead cities” ARE THE VERY ONES WHO MADE THEM “DEAD.”
we, who love parties fun and people and adventures, walking to restaurants concerts events instead of ordering everything in, are charged by powers higher than those on this Earth, to bring them back to LIFE and i aim to do just that.
i read of a suburban housing boom with awe and dismay at americans’ fickleness and will never understand choosing a place to live with no more can than ordering up a sweater online. (one of James’ old engineer acquaintances just bought a house sight-unseen 1000 miles away online to LIVE IN full time).
but more importantly i read of a suburban housing boom (exodus out of cities) as a chance for LIFE TO RETURN for those of us who make cities (and being HUMAN) actually INTERESTING and full of LIFE again, like over at Chernobyl.
Kitten,
Even though I’ve never been a city dweller (I am a country mouse, born and raised) I totally agree with you. I used to spend a great deal of time in downtown Philadelphia in the South Street area, and it was AMAZING!
Then a Benneton appeared. (Yes I know I’m dating myself with that one.) Within 2 years the entire mom and pop, struggling artist, concert venues, and eclectic shops were gone. Gentrification had set in.
So I hope all the artists, musicians, parties, concerts, etc. come back home to you!
> we, who love parties fun and people and adventures, walking to restaurants concerts events
Ahh yes, I remember those days. Then I had children. What a difference in perspective, on almost everything.
Good to see you back Kitten. I love your blog. My handle says LA but I’m SF born.
thanks 2GeekRnot2Geek– 15th/Lombard til ’94…time of my LIFE and i’m gonna fight to give this BACK, Paul from NC (oh, it ain’t over YET, don’t get too comfortable farting in your recliner/anything could happen as it already has… i’m not talking smack), David G in LA–don’t worry, i’ll take care of my adopted city while you’re away/it made me everything gave me magic i’ll pay it forward and back and on and on… this is a verrrry magical place. thank you for making it magical for ME. / SF taught me this love thing is real and sweaty. dinnertime gotta GO! James calling me. / good night. x
That would be nice. You’re absolutely right. I left SF many years ago and lately haven’t been visiting much. It would be nice to see it come alive again.
I’ve been in dozens of cities in the Rust Belt, including the most rundown areas therein, but the only place I ever saw rats openly scurrying about in streets and sidewalks in broad daylight is NYC. Same with the roaches at LaGuardia.
I saw them on Central Park West and I’ve seen plenty in Boston
During the cold months, there are about 100 homeless guys living inside the terminal at LaGuardia. It really makes a good first impression to travelers from outside NYC, especially those from different countries. The city claims that the bums have rights and they can’t be evicted.
Sounds like SanFransicko Sorry Wolf
Yuk!
Ah, the magical midnight rustling of the rats hunting through the black garbage bags stacked waist/chest high on many a Manhattan street…that’s why people love NYC.
Well, that and Broadway.
Definitely worth 3 or 4 times the national median cost of living.
And…the delightful taxes.
I have seen many rats here in Tokyo, of all places, including rats on busy streets in broad daylight. Rats are a feature of any big city
It was pretty scary when I found myself in front of a rat stampede. They turned out to ignore me though. I wonder if some poor souls get et by rats.
That’s because in NY the people put more food in the rubbish I think Rats love gourmet food Look at all the fancy restaurants down near Wall Street
You can spot a lot of 2-legged rats & roaches in suits on Wall Street too!
In Hawai’i houses are hot and condos are not………………
Probably the HOA fees associated with condos as well as the regulations scare people off rightly
Elevators.
The monthly fees for a lot of those condos is more than the mortgage!
And the City and State of Hawai’i have totally mucked up the rental market with all sorts of rules, regulations, and especially taxes and more taxes over the past 30 odd years…………
Wolf and all of the comments so far are focusing on living space and the new WFH trends, which in some cases seem to be more permanent than temporary. I would suggest that many people are also fleeing to the ‘burbs purely out of concern for their safety and that of their familes. As we continue to see American cities torn apart by what seems like ever-increasing levels of unmitigated violence and destruction, the question becomes “Is this where I want to live my life?”
Who in their right mind would want to stay in — let alone move to — a Portland, Seattle, Chicago, or NYC? Or for that matter, even a sleepier city such as Kenosha or Louisville?
I think you are correct because I’m not seeing this flight to the burbs occuring in Eastern Europe or in Turkey
I wouldn’t give up my place in the center of Warsaw for any lousy burbs Personally I love to just walk out the door for a great cup o joe or dessert but maybe I’m an anomaly
I’m with you there. I’ve spent most of my adult life in an urban environment. While some have been safer than others, the concession you make for living “in the middle of it all”, the trend until very recently had been one of improving conditions due to much-maligned gentrification. That trend has been turned on its head in the past 5 – 6 years or so, with a rapid decline in the past 6 months.
Going back to your cup o’ joe in the local cafe — when you can no longer enjoy that cup without being beset upon by an angry mob with bullhorns shouting in your face and literally slapping the food out of you hand, the allure of urban life quickly loses its appeal. Surely that never happened to the “Friends” sitting on the sofas at Central Perk. Not sure how this may be portrayed in the Warsaw press, if at all, but it has become common in many once great American cities.
The biggest losers of course are the small business owners. Even if pandemic theater lock downs didn’t do them in, or their business wasn’t torched by social justice warriors with gender studies degrees, their middle class customer base is leaving by the U-haul load. Not only are those customers very unlikely ever to return to residence, they aren’t likely to even come back for a cup ‘o’ joe any time soon. The downward spiral.
BradK I guess you must be working for the RNC. When I left NYC 4 1/2 years ago I felt perfectly safe there, and I’ve seen nothing in NYTimes about deteriorating conditions. The incidents you are talking about were reported by NYTimes to have happened in Portland and there is no indication that they are common there. The picture you present of US city life is a vile distortion.
The difference being Warsaw is a super safe city I’ve been going there since 1980 and never seen or been a victim of a crime except a few Roma kids petty theft which was rapidly dealt with by the authorities Even the east side of the river, Praga which used to be dodgy has gentrified and is safe even at night
The situation in the states is upsetting viewed from abroad The upcoming election could be very unsettling to say the least
Hey Paul… in case you haven’t heard the NYC murder rate and burglary rate are up by about 40%. No hype…just stats.
do you work for the DNC?
and when is Cuomo gonna make my dinner?
Paul says:
“and I’ve seen nothing in NYTimes about deteriorating conditions”
And you must be Baghdad Bob…………….
Got news for you: even the NY Times is reporting the following:
“A Violent August in N.Y.C.: Shootings Double, and Murder Is Up by 50%
The city recorded 242 shootings in August, up from 91 last year, continuing a summer spike in gun violence that has become an issue in the presidential race. ”
2 September issue.
Violent crime always rises in the summer, but this year has been extreme in New York. Since May, the city has recorded 791 shootings, a more than 140 percent increase over the same period in 2019. The 180 murders seen between May and August is a more than 51 percent increase compared to 2019.
In August alone, there were 242 shootings in the city, compared with 91 last year, and the number of murders rose from 36 to 53. As a result, the city surpassed 1,000 shootings before Labor Day, making it the worst year for gun violence since 2015, with four months left to go.”
Geez………………
BK has it right IMO PE,
If you would bother to read widely, it is clear from reports on many so called ”alternative” newspaper and web only sites that, first of all the NYT has become nothing more than a mouthpiece for the left wing of the left side of the aisle, to my great disappointment as one who formerly read every word of NYT at least once a week no matter where I was living.
Now, retired from my work that entailed reading a thousand pages a week on average, and with the convenience of the web, I read dozens of sources around the USA and another dozen or so around the world every day; trust me, there is no way the NYT is the voice of USA or truth as it used to be.
Brad, I’m in 100% agreement, and would say that anybody with kids in a place like Portland is leaving out of fear for their family’s safety.
Portland may have plenty of delusional for-left leaning folks, but IMO most of them see the light when they’ve got kids to look after.
“The trend had been one of improving conditions due to much-maligned gentrification”
Ah yes, improving communities through displacing poor & POC families & tearing down generational (affordable) housing & evicting local-owned businesses. Tossing off an area’s culture & vibrancy like an old sock just for a micro-brewery (12th in the city) & a luxury condo development. Good old gentrification…improving the lives of the wealthy in a metro area near you!
Moomoo I saw the article about the August spike in crime. I was talking about his assertion that things were going downhill the last 5 years.
You may be sure I would not work for DNC or RNC. I think the difference between them is merely cosmetic.
And personally I wouldn’t try to eat Andrew’s cooking.
Lee as I said to Moomoo I knew about the summer spike in crime. I think it was due to restlessness after a long lockdown, plus unemployment. I was saying I didn’t believe BradK saying that things were getting worse for the last 5 years.
I think that some people can’t be helped, even by Jeezuz.
VintageVNVet I think you are wrong. NYT has become the mouthpiece of the DNC, which is the right wing of what passes for the center. I don’t trust them, but I haven’t noticed that the local reporting is particularly distorted.
But Poland is vastly different from the US cities. A 15 minute car ride from centrum of Warsaw, and you’re in dense ancient woods, ready for some mushroom hunting. A 15 minute car ride from centrum of Chicago, and I’m still stuck in traffic in centrum of Chicago.
15 minutes and you’re still in well, Central Warsaw To get to dense forests you need to drive two or three hours Two million population and lots of rush hour traffic but great mass transit Clean brand new subways and lots of modern air conditioned trams and hybrid buses My tenant who is a lawyer keeps his car in the burbs and bikes to his office Lots of bike lanes too which is great
BradK,
There are some people who like to live in the sticks. There are some people who like to live in small towns or smaller cities. And there are some people for whom really big cities are magic. Everyone likes something different, and that’s good. We love it in San Francisco now even more than before Covid because the frenzy has calmed down. Restaurants and the like will come back, with lower rents. But the people for whom big cities are not magic, and who were just living in a big city because it’s close to the office, they’re the ones leaving.
uhm, yeah. you said it. i should’ve read to the end before wasting my time writing more and more words. this is IT.
oh and while i’m here: i’m glad you’re planning on being alive when your wife’s 70. and i’m glad you love it here in the city and will stick around.
x
Yes, the risk in Chicago is sudden and acute lead poisoning in the streets. Anxious to see how Corporate America navigates the PC route post-Covid to get the starry-eyed Millennials back into the office buildings Downtown. Don’t think that the Starbucks machines and kewl open-office concept will do the trick anymore. Secondcitycop blog / comments by Chicago cops a real eye-opener, even for someone who has been around there over 60 years like me.
I live about an hour from Durham, NC. Shootings are up about 70% this year and that is from a high base. Mostly black on black young males doing a lot of shooting from cars into cars and homes with children and other innocents getting caught in crossfire. Somehow government policy has really goofed up that 17 year olds are gun fighting in the streets instead of getting the skills needed to earn a decent living.
Crime is up in rural areas too. Don’t kid yourself. The heroine epidemic is too real. Plenty of meth everywhere. I live 70 miles from anything you could call a city and the robbers go miles up dirt roads in 4×4’s with AK 15’s. They’re a little scarier than protestors..
Just don’t be flashy. At all.
Exaggerate much? Portland is a big, gorgeous city and the protests have been limited largely to a few blocks.
You may remember that this country was born out of protest.
Protesting won’t on forever and please note what one protester said:
We came out here with hula hoops and signs.
They shot us with rubber bullets, so we put on helmets.
Then they gassed us, so we put on masks.
Now they call us terrorists!
See how it works? You gotta lay off the Fox “news” and try a refreshing dose of reality. All this fake pearl clutching is a bit much.
Maybe so dcnt, but the local news websites showing folks dining outside to support local restaurants being harassed by ”protestors” were certainly not seen by this old boy on the foxy one, because I pay no attention to any of the MSM, including that one…
They are OK for sports, but only with the sound off most of the time, due to the inane comments most of the time…
Yea that dining story has been circulating like the holy grail of cheap fear. Diners yelled at… OMG! Algorithmic amplification is a modern “feature” everyone should familiarize themselves with.
Quick update from urban California…everyone hasn’t left yet. Patiently waiting. /s
I am ok with the protests, but there are criminal thugs that infiltrate the protests and destroy people’s lives by destroying their businesses. The nonviolent protesters should have assisted the police in getting the bad guys out of the group. By not doing that public opinion has turned against protesters and they have lost support of the average voter which is what counts.
You don’t win public opinion by being rude, getting in people’s faces, shouting four letter words and destroying people’s property. In some ways the protesters are a paradox in themselves as many hate capitalism while taking pictures with the ultimate capitalist product (an iphone) and wearing products made by sweat shops.
How does that $1K/mo. for 2BR compare to the local market? Are they really dumping cheap apartments? Depending upon how many new residents may be drawn in, this could instead end up forcing down everyone else’s rent in some good, old fashioned market signalling.
It does seem like dumping and it is likely to depress the market but as I said I expect it to turn around in a year.
Could they be driving the market down so they can buy up existing housing? Is there a law against that?
Paul I follow Connecticut pretty closely and it seems many of the better paying jobs did NOT return post the Great Recession
Lots of beautiful large homes( with very high property taxes) to be had on the cheap in Fairfield County near NYC Trouble is nobody can afford them even at the discount prices
…just ask for a discount for 2-3 years paid up front. And that no increases will apply to you.
Hey Hartford! I live near the Barkhamsted reservoir, still in the county but a world away…
Another CT resident here too – Enfield. I’m seriously looking to retire away from CT to a income tax free state to the south. Between the CT state income tax and local property tax I’d be made to continue living here in retirement.
Look for the taxing arrangements to change from “city tax” to “county tax” as people move from the urban to suburban.
This was floated a few years ago in Chicago / Cook County.
The county was proposed to be on big Chicago for taxing purposes.
Brace yourselves.
No doubt they will find a way to rob everyone Grifters always do
Fred I guess you prefer to pay the Feds to squander your money on arms makers and health insurance companies and big pharma than to pay the county to squander it on water supply and education. No doubt you have a reason.
Certainly I do not prefer that but local taxes are outrageous in the states I own properties in Poland and a Turkey and pay minuscule taxes and yet get better services Explain that one to me please Many areas of the US have gone off the reservation with property taxes and many more will leave as I did
If only that’s what state and local taxes were for! Try Medicaid and pensions, especially if you are in NJ or IL.
Look for city taxes to become state taxes. That way the state can funnel it back to the big city. I would think moving to another state with no really big cities would work but those states with big cities would probably get federal taxes raised and funnel it to themselves. In fact that might be what’s actually going on with Pelosi demanding Trillions for the states. I’m sure that would be proportioned according to state population.
I’m also thinking limiting deductibility of SALT is pushing large states that are poorly run over the edge. Which, in turn, is causing outmigration and perhaps even roving bands of rioters and looters.
We are so far down the rabbit hole of debt in the USA that cities and states think the solution is to just have the Fed’s print up another trillion dollars. I have already determined that there are two kinds of dollars. The ones that I have that are few and precious and the kind that the government has that are unlimited and squandered easily.
Amen.
I think the trend is a net positive. WFH can be urban, burbs, or rural. People can make that great cup of joe at home or invite the friend over you were going to meet, anyway. People will have more choice.
People can also better grow into who they are, rather than having a work location be one big compromise about everything; something that eventually changes you. Just an opinion, though. I’m retired.
One thing about safety. If society breaks down nowhere is safe, including the ‘burbs. Hopefully, the worldwide situation will be different than what this slide seems to portend.
OK Paulo but at home we won’t get to chat with all the cute Ukrainian girls will we ?
Yup, (I had to smile). You just need a cute Ukranian girl at home (like I have). Well 1/2 English and 1/2 Ukranian. She even made me coffee, yesterday. :-)
I like going out for coffee, too. One day I ran into an old flying buddy I used to work with. Thereafter, every town run I used to time my shopping to finish up at his coffee shop time and we would have a chin wag. Then Covid hit. But I get your point. I enjoyed sitting outside and watching the World walk by, sparrows taking over the plaza. It was pretty nice.
i think it’s gonna get a whole lot worse first, because the white collar workers aren’t prepared for being made obsolete or extranneous or gig worked outsourced via this WFH move.
the system picks us off one-at-a-time like dazed buffalo. but i FEEL that The Powers That Be have gone too far and we’re at a tipping point finally or soon.
that said, i’m actually optimistic because pain is at least something beyond numb deadness, but as your Leonard Cohen said, the cracks are where the light gets in.
so true.
so i’m also optimistic in the long.
x
Thanks for that reminder. One of my favourites!
Good thought. If you can do your job remotely it can also be done in India or China.
O now I see. WFH means work from home.
Isn’t that where all this is headed, globalization and one world govt ?
Yeah, the whole wealth-transfer gig is already old for many … but it’s the other, far larger engaged crowd .. who, for variety of reasons, are caught in the downward position within the planetary-monied seemingly ‘perpetual’ grift-engine, who may lose their sh!t .. having virtually no preparation for much in the way of uh, downsizing ‘privation style’ …
For us, with little debt relative to everyone else, relying on modest income stream, owning our home, clear .. with few assets but who can at least grow some food … I’m not at all sure that the plebs will, in the main, stay rational. And I’m talking the MPC contingent – those for whom unavoidable physical work is for something to be passed by, quick like! I know,I’m generalizing – bigly .. but when your whole means of existence × multi-millions of your neighbors, becomes unobtanium – verily so …
I’ve been, for ten years, trying to scale down, knowing that something would go Smash!-Bang! – this pandemic fitting the bill .. or some similar rhyme .. something a LOT of people just haven’t had to grok.
People will just ‘lose it!’ .. as per the Gerald Celente quote.
Sorry,
… forgot the disclaimer : ‘I’m not too sold on the ‘optimistic’ part myself’ .. having had the politician$’ FAVORITE utterances – “HOPE” and “We,Together” – spit oh-so-meaningless into my face one too many .. to care much anymore …
Breaking up IS hard to do, as been’s sung .. after all. New boundaries, new borders, new alliances – and all that!
Seems to me a lot of people are extrapolating the extraordinary situation of 2020 to become permanent. It won’t be. Worst case is advanced economies will have fully vaccinated populations and the associated herd immunity by 2022.
Things may not return to exactly as they were but trends where people accepted less space for the benefit of being near the people and businesses they wanted to frequent will likely still apply.
Businesses would like to ditch all their office space and save money but the reality that it is difficult to hold remote employees accountable will soon start to settle in and force them to limit how much of this is allowed.
People who are paying 20-50% premiums on real estate in more rural areas thinking this is permanent may ultimately get burned when Covid is more a painful memory than a current crisis.
Dave,
Agree with your post except for the ”worst case” part; IMO that is the best case, if for no other reason than the incredible amount of lying that is coming from all sides.
Worst case is much more likely to be at least a lot closer to 25, that is 2025.
We still have a long long way to go, both with this virus event, and especially with the economic and political situation now continuing to develop.
As has been said on Wolfstreet.com many times, last time it was many years from start, actually indicated as 2006 in one of the charts above, until any but the very earliest places recovered their RE mkt, and some places still have not recovered.
(Been involved with RE mkt crashes since 1956.)
2025! You are out of your mind. This will all be blown over by the end of 2021. Employers will want people back in the office and everyone will be scrambling to buy and rent close to the office once again. This WFH experiment has been done plenty of times.
I’d hate to spend trillions on states when we could flush trillions down the toilet in Iraq!
You may remember that none of the 9/11 hijackers were from Iraq (or even Iran!), but 15/19 were from Saudi Arabia! So we invaded the WRONG country! Dead people and trillions down the toilet….all for nothing.
And as far as spending on states, you can look it up and you’ll see that blue states like NY, Cali, etc. pay far more into the system then all those near 3rd world country red states down south (I live in one of them).
I’m amazed at how people whine about spending OUR money on US (the people) but have no problem letting the MIC steal your children’s futures while big corporations poison us and get huge tax breaks.
+1,000,000
I agree. I know a lot of people making permanent changes when the new status quo isn’t known yet. The world has suffered a severe economic shock that has been papered over with more debt and lower earnings going forward.
I read up on John Law’s Mississippi stock bubble and the great depression. Stock prices fell close to 90% in both cases which turned the party into tears. I think the Fed knows that if the stock market falls the unwealth affect is going to be all she wrote for the current system as corporations slash and burn their workforce and people cut consumption. If you read between the lines this is what the Fed is preparing for, direct helicopter money to your bank account or some other scheme such as buying stocks (yea I know it’s not allowed now) that would have been unimaginable a few years back.
Through all the fancy doubletalk the Feds job is to ensure politicians can look like benevolent givers instead of tax collectors.
1) New Single Houses Sold : the market at the bottom of 2005 swing point.
2) From 2009 til 2012 RE whales accumulated houses at low prices.
3) At the bottom, when prices went even further down, the whales didn’t care. They were bullish.
4) The public discovered the RE market, the trend was up.
5) Prices moved up effortlessly, on low volume, because the trend is up.
6) The trend is up until there will be a change of character.
7) Since late 2018 the RE market started to misbehave.
8) In 2019 the market went straight down.
9) Since Mar 2020 the guppies are buying in the suburbs. Sales went vertical. In the major cities sales are plunging. There is no demand, there.
10) The average prices are FLAT : rising in the suburbs // falling in NYC, SF…. from high level.
11) The whales are selling to the public, taking profit. When market buying will reach a climax the whales selling will increase. They will distribute their assets to the weak hands, until demand will wane.
12) The markdown will start after there will be a change of character.
13) Both the guppies and the whales selling on high volume / falling prices, will send prices to Bottom Fishing levels.
What do you mean by “change of character”?
“change of character”– the riff raff i was mentioning above.
but i think the suburbs were already turning into ghettos, too.
I went to the original ghetto for my 40th birthday. It’s in Venice, Italy and ghetto is rooted in the Italian word for “foundry”.
That’s where the Jews lived during the Venetian empire and they were not allowed out at night (except the occasional doctor).
I walked around it for a few weeks and was struck how gorgeous the original “ghetto” was and still is!
Imagine if some of those trillions flushed down the toilet in Iraq had been used in the USA to build schools, hospitals, etc.
The USA could be a wildly different place if some sensible people could ever take over Congress and the Presidency.
In the major cities sales are plunging. There is no demand, there.}}} wrong… There is plenty of demand in cities like NYC & SFO even with the ‘pandemic theater’ and ‘social justice warriors’
And for the business owners I say tough ti%%%ies — like the national retailers that are closing, likely these businesses were crappy anyway and how many $6.00 a cup coffee places are needed in a five block radius for example.
This time around (unlike 2005-2007) were have mortgage rates that show no sign of rising and oil prices stable at $40.
Live & work rural flyover. Almost 30yrs with our business. We have NEVER
witnessed the land rush such as this. Maybe in march & april it was about
the virus. Thats not even visible in the rear view mirror today.
The surge is tied to the purge currently underway in the nearby cities.
Its a race to see how many freedoms can be taken, and who can be the most “woke”. My clients are typically from chicago, milwaukee, madison, or the twin cities.
The rapid increase in building supply costs, and availability, will slow the builds. Along with winter.
Really??? Never seen a land rush like this???? What exactly do you mean and what evidence is there (other than a mere 15,000 empty apartments) that places like NYC are ‘plunging’ and that everyone is packing up and moving to the suburbs just because of ‘pandemic theater’ and the whole SJW theater…
Simple statement from a business that is tied to rural construction.
No stats, no bean counters, no charts or graphs…..just living it.
Do not live/or work near NYC. Have no idea on their market.
RE might be in re-accumulation. When over, the market uptrend
will resume.
In dollar terms no doubt it will inflate up and away In real money terms it will deflate I lived this in the late 70s and the US was at a much better standing in the world then excluding the war anyway
@Michael Engel
‘RE might be in re-accumulation. When over, the market uptrend
will resume’
we are coming coser to beginning of a ‘DOWN cycle’ after expansion for nearly 11 yrs. Public debt could be handled by monetization, MMT and infinite expansion of balance sheet at Fed. Long way to go considering Japan has debt over 300%, ours could be around 150%(!?)
Corporate credit mkt was supported by Fed buying bonds since April and apparently no more. What about personal/household debt? Where/When are the jobs coming, at what extent compared to pre-covid? nearly 50-60 of businesses are permanently closed (Yelp). Unemployment is increasing although cameflouged by data chaos. It is NOT just the Blue collar jobs but now even some white collar jobs are at risk! Not every one is employed in IT or similar digital based industry.
By mid-next year, the state of affordability to own HOUSES and ‘means’to carry servicing of the debt(s) required will be challenging for many.
World has changed since covid and housing will also get affected just like during GFC or worse! DEBT levels are at unprecendted record level, world wide.
I hope I am wrong but many have not apprteciated the primary, secondary and tertiary impact of the virus, even after a vaccine.
Oh, but home working is SO easy, even in an apartment: one spends all their time in the kitchen, the other -the highest earner – in the ‘office’.
I’m retired from home. Nothing changed much.
I’ve been working from home for the better part of 20 years. I absolutely love it. I don’t have to shave, get dressed, fight traffic/road-ragers, etc. No parking/speeding tickets, no getting stuck in traffic jams.
I can use my time and talents to do my job. I don’t have to wait for you to finish your print job or listen to the ridiculous banter of my mostly idiotic co-workers.
Working from home is the greatest thing to ever happen to work. If you
competent at what you do, it’s no bother at all, imho.
Another trend that was already happening just accelerated by covid. It’s not just where to live that’s moving, but jobs and “city life” too. Around DC, many larger suburbs are cities in their own right. New mixed use town centers, nicely planned and walkable, for work, living, and pleasure.
Just don’t tell that to Jim Kunstler
Yup, this is exactly what I was seeing and pointing out back in May, and was mocked by a few here. Covid cubes aren’t very desirable during a pandemic and even less so with kids and having to work from home. 92115 has been on fire since May and continues to be so. The median price in San Diego is 640k but if you want anything nice in the old neighborhoods be ready to shell out close to a mil, which will get you 1600sf in the nicer old areas and around 3500sf in the burbs away from the city center.
We’re still in this insane state but no where near the insanity of SF or LA and folks know it so they’re coming here. The city itself is going blue but the county is solidly red and probably will he so for a while. Things are only going to get more and more expensive here, and in short order. There has been no sept or aug slowdown at all.
I said the same thing- the market is hot and will continue to be back in May. Some suburbs in Ottawa are up 40 percent ytd. Many disagreed on here calling all out doom. Lol.
Booming on the West Coast of Canada as well. Our economy is still doing okay. We are also seeing folks from back east who can no longer travel to US. I think this trend will continue. Beyond home sales, rentals are in very short supply.
Booming in Winnipeg and especially cottage country where winterized places are going for a premium. A lot of senior sales and lawyers are working from their cell and laptop and have decided to move to the lake, especially if the kids have left the house…
Does a million dollar home make any sense unless you are really making big bucks and get appreciation on the home. I think for maintenance, taxes, insurance and keeping it updated to market conditions is about 4%. A 3% mortgage means you are up to 7% and you have to pay that in after tax dollars so you are probably having to gross 11% or $110,000 just to keep treading water. It really can only make economic sense unless house prices keep going up or your gross pay exceeds $300,00.
Old School – where do you get these numbers from? They don’t really make sense to me.
I’m at nowhere near 4%. On my home valued at $800k, that would be $32k. There has never been a year in my life where I have spent anything like that.
I’ll give you my numbers, although that only qualifies as anecdote:
Current value $800k
bought/built/cost $450k in 2014/2015
This year’s repairs/upgrades so far: $150
Taxes: $5200
Insurance: $645
Mortgage payment $1484
Tax roughly 1.3%
Insurance 0 7%
Maintenance 1% (That’s if you pay to have done. Roofs, HVAC, appliances, paint don’t last forever).
The 1% is a swag on keeping home up to market conditions. Styles for kitchen and baths change and probably have about a 15 year style life. I am like you I did it all myself and didn’t really update style, but I had to price it house lower as it was outdated
National median on taxes and insurance are approx 1.5% or 12k on 800k valuation.
Where do you live that you are only paying $5845?
Prop tax deduction might help that some (although 2017 tax act gutted high end deductibility…one mjr reason why Dem coastals are so desperately desperately to seize Presidency and undo…) but nearly that much.
I’m sorry but no way on earth is your homeowners insurance 645$ annually on an 800K home, it’s at least 3 times that amount or else you are vastly underinsured.
I’m in Montana, outside my city’s limits. Taxes are based on assessment from almost 2 years ago, then it was $670k.
Insurance amount – that’s what it is. Interestingly enough, in 2021 my insurer, UFG will be getting out of the retail insurance business, so my policies will go over to Nationwide. I think that my state government caps annual homeowner policy increases, but I don’t know if that will apply to this scenario so I’m not sure how much longer I’ll get this kind of rate.
I’m a little ‘underinsured’, but not by a lot. I think I could get the home rebuilt for less than prices would indicate right now and have enough insurance from that perspective. We’ve had a substantial run-up in prices as we’re a destination for folks fleeing the big cities.
As I’m not married, no f’in way am I redoing baths/kitchen for style purposes… But I’m always curious about the latest trends. Here new construction continues to go with more modern style/design, to the point that I’m not a fan.
Old School – thanks for your numbers. Glad I don’t fit those!
Jeff,
Thanks for the info.
It sounds like you are pretty rural (MT is very large and very empty). Even the cities are pretty small.
Your house must be huge…it is very, very hard to spend 800k on a house in MT.
(I see you paid 450k for it in 2015…and somebody is valuing it at 800k just 5 yrs later?…maybe the taxing authority makes up for low rates with heavy overvaluation…)
In any event, I would say your experience is very atypical…MT is much, much, much less populated than the vast majority of the states.
I grew up in San Diego’s east county. Yeah, it’s going to turn about as blue as the central valley.
The only good thing politically about being in the city anymore is that I’m in Jacobs district. My friends joke that I should live in east county.
We are literally 92115 neighbors, Bob. As someone who has lived in both SF and LA and now SD, this is a veritable paradise of both livability and affordability in contrast. Clean steets, awesome weather and air quality. Manageable traffic. Great restaurants (hopefully many can survive). SD is a holdout of the old California, not (yet) victim to the lunacy that has destroyed most of the rest of the state.
Brad, Now why would anyone leave San Francisco?
I offer for your consideration a 9,500-square-foot San Francisco home at 950 Lombard St. on the crest of Russian Hill listed for $45 million.
(Forty-Five Million, not a typo)
Really nice location, across street from the Art Institute. Great views, morning light. A pool too!
Clean fresh cold air most of the year.
Sixteen cars broken into on your block in the last couple of years. A recent spate of burglaries and home invasions a short walk around your place. Several assults. Housing projects a few blocks away.
Your children can walk 1/3 of a block to a public elementary school. Covenience! However, that’s if you get really lucky and win the school lottery. Odds are that for diversity and desegregation, they get driven to school at least a five mile round trip, twice a day, unless you are willing to put them on public transit, which would subject them to homeless vagrants, child molestors or simple robbers.
A few mediocre grocery stores a short drive away. Trader Joe’s parking lot is in the basement of the housing projects. North Beach, your neighborhood, has had greedy landlords pricing cafes and restaurants out for half a decade. Now, it’s all shut down.
A twenty minute drive across the Golden Gate Bridge, you could buy 40 nice houses with big yards for the same price, in a variety of small safe and unique towns, all part of the larger suburb, send your kids to a neighborhood public school of the highest quality, enjoy better weather, bicycling paths, nature, clean air and your neighbors will be highly educated, have children and speak English as their native language.
Most techies who can remain in California are approaching child bearing age. That alone, will doom what’s left of San Francisco for families, a city which has more dogs living in it than school age children. Wolf can definitely negotiate a lower rent in the coming years.
Locals here in AZ have grown tired of the California/Oregon cash offers here in AZ for homes on the market. Trends point to high tax state moves to states like AZ, TX, ID, and UT here in the west. Personally, it’s hard for me to swallow dropping $800K+ on a home move at this point when I keep thinking in the back of my mind that prices will go down but, low interest rates will keep this housing market burning likely for the foreseeable future. Majority of people are foolish with their money and play the consumer/debt role very well despite these strange economic circumstances. I’ve found most new buyers don’t even want to see the price they pay. They are only interested in what it will cost them monthly for a mortgage payment. I choose to sit on the sidelines while the clown show goes on. I’ll jump back into buying homes when the fire has burned out…..if it ever does at this point.
Well the monthly cost is what matters if you’re shopping for a home and not an investment. A lot of people still do that, but anyway, one has to wonder if the fed doesn’t go negative how much lower mortgage rates can really go. That limits upside to housing prices, and builders are all the more incentivized to keep building. A lot of builders are probably just temporarily scared of impending doom and taking it cautious right now. Either way, if the government bails out fha loans, and the fed keeps buying mbs, then mortgages are going to keep being handed out by financial institutions and we won’t see a collapse in housing prices. Unfortunately, that’s only good for people who already have houses. It takes a shocking percentage of the average after tax paycheck to afford a median mortgage if you’re new in the market. Financial advisors have basically condemned the majority of society to the status of “financially irresponsible” just for trying to have a house. Responsible as they define it means living in 50 year old apartments or the cheapest 80yo shack you can find in many cities. Too bad they can’t make more of those… Americans could also just accept that American individualism is dead and find cohabitants to coop up with. The younger generations already know this is just how it is now, but many of them also expect to live like their parents eventually.
CRE is getting crushed. We got insane amount of office space and properties for sale. I only live in a medium sized area.
Interesting that hourly workers are moving in while salaried employees are moving out. RRE is going through a major shift. My guess onshoring some production in the bigger cities is next.
Greedy landlords won’t lower office rents. They may change their tune when hundreds local corporations declare bankruptcy next year and walk away from their leases, back rent and tenancies.
Picked up 100 pounds of white rice and twenty pounds of popcorn at Costco last week. This is going to get interesting timesy.
Nobody is tracking the impact of the RE platforms(zillow, redfin, opendoor, and others) on the market. I see a lot of overpriced RE where I am and many sales at the higher prices. Can’t wrap my head around why a local would pay 100K more than last year in this economy. Me thinks, only someone with money to burn would do that.
People were doing that in 2006 without money to burn and they foreclosed. Curious to see how the employment situation looks when forbearance ends.
Ditto Turtle’s thoughts, and Petunia’s as well.
Out here in the hinterland (and we also like “the marches” as moniker; but please, Wolf, not “the sticks”), I am celebrating seeing the balance on the mortgage go below $20 K on the next payment. However, I have not been tracking prices on local real estate.
Not a lot of COVID out here, but most of those of us who are “at risk” continue to take care.
I admit that I’m hoping to see here, soon, a post on the hype from Elon Musk re the mining empire in waiting, in Nevada. Just where are those lithium claims, anyway ?
Best to all.
The human behavior appears to be the same as the late 2000s….speculation and financial overextension out of control…. the housing financial environment isn’t quite the same so likely won’t yield the same results as quickly but should still yield similar results with more foreclosures. Starting to see more foreclosures and delinquent property taxes now.
That and Blackrock, Blackstone, Invitation Homes, Colony Starwood, American Homes 4 Rent etc. etc. Plus the ubiquitous “We Buy Homes for Cash” companies. I can’t find any data on this either.
I’m very suspicious.
Petunia – For some it just means selling some stock, paying the taxes, and buying for cash. Although with interest rates this low it makes some sense to finance 60-70% and not have the cash tied up, leverage applies too.
Young people out of work and living at home with parents might look for construction jobs.
In my area ( Long Island) if your not very young and Hispanic forget about it
The NIMBYs don’t allow them to build anything.
Those who are into building something are buying a van or RV and remodeling it, making housing a discretionary item altogether. The smarter among them will get rid of property taxes and state income taxes long-term, shifting that burden to the NIMBYs, as it should be.
What kind of discounts can you expect in NYC right now? Well good friend leased a 2k foot place near Central Park starting Sept 1. They were asking 13k a year ago for the same place. My friend settled with them for 7k a month. Now go across the board and expect similar and you tell me what the result is for CRE et all.
“tell me what the result is for CRE et all.“
The result is that the bottom is in and it’s only up from here.
The bottom is in??? Nothing has been allowed to even drop because transactions have slowed to a crawl because everything has been put on ice with eviction moratoriums and mortgage forbearance deals. It will take a long time to sort out where the bottom is.
Totally agree Wolf. Friends keep asking why the housing market hasn’t failed at this point. My response is simple. Hard for the housing sector to fail when you prop up sellers, buyers, interest rates, delinquent payments, moratoriums, forbearance etc. The short and simple fact is this… no failure until you let it act like a free market. The propping up can’t last forever.
With recent announcements by executives touting the benefits of working in office (JPM CEO, Google CFO, Apple CEO, Microsoft CEO, and many others), I think the WFM fantasy is already starting to reverse. I predict that very few businesses will allow their employees to work from home in the long run. If your competitor is working in office, you can’t afford to let your own employees work from home or you will lose money from lack of productivity and innovation. This will force everybody back.
Regarding housing, I predict the data we’re seeing is partly a temporary situation built on a miscalculation. Many people think WFH is a long-term prospect, but it isn’t. By mid-2021, I think 90% of folks will be back in office. My spouse went back to office a couple weeks ago. JPM employees are returning now.
Also, I think much of new home sales increases is attributable to the low interest rates and better deals being offered, and not so much a WFM expectation. In Seattle outlying suburbs, I see new 5 bedroom 3000ft newly finished houses going for around $700k. Existing houses with comparable space, but in bad need of remodeling, moss control, and deodorizer, are asking same price. Thus, the new houses seem like a much better deal. I think the price differences result because builders need to sell. Existing home sellers can usually afford to take their time in an effort to maximize price.
On the contrary, companies that DO allow work from home will get the better people who can command that flexibility. I will NOT be going back to an office 5 days a week.
JPM, Microsoft, Google, are all the big companies that can to some degree afford to make their own policies, at least initially. When people start leaving for smaller places, they’ll change their tune.
We disagree on that.
I’ve been in business a long time, and I have never met a talented, motivated corporate employee that wanted to work from home. They want to learn a maximum amount in a minimum amount of time. They are always willing to be available and make sacrifices for the employer. WFM arrangements have always been allowed to some extent, but not for leadership or skill positions. There’s a reason for that.
As an investor, I would never own stock in a company that let the bulk of their employees work from home over an extended period. I think that company would be on a solid path to failure.
Yep, I still disagree. I’m willing to sacrifice my time and effort, but not to sit in a closed office 5 days a week when there is no business need. The time saved on commuting at my company alone has made it worth it, not to mention the reduced expenses.
I guess we’ll see, but I don’t think the old “normal” is coming back.
Look at Automattic, Inc. 1,000+ employees. 100% remote. They’ve been doing this for years. Lots of growth and investment.
https://automattic.com/work-with-us/
Not everyone is interested in change, because it’s hard. Not to say that every company can do this, but many can – if they want.
Turtle, ultimately the market will drive this, not the whims of 60 something CEOs.
I remember law firms, banks, accounting firms in NYC swearing that they would never move to business casual. Nearly all of them eventually caved.
Billy G. made the Fresca free.
WFH will be canceled when companies need to get rid of employees ( especially those hard to get rid of ).
This strategy was used by IBM, Yahoo!, etc in the past few years.
RightNYer,
don’t forget how quickly you white collar types age out of being able to demand much of ANYTHING past a certain point. / i saw it happen to all my White Guy Friends we used to say had all this amazing white guy power. not when they hit their forties. all of ’em got too expensive and that’s when i realized if my once-swaggering know-it-all friends were brought to their knees, we’re ALL—-
… you fill in the blank.
>WFM arrangements have always been allowed to some extent, but not for leadership or skill positions.
I’ve been in tech (likely a different industry than the one you’re referencing) for 20 years, and have seen 180 degrees the opposite of the view you’ve just expressed. The highest skilled, get to choose when/how many hours and where from they work. Often, they get to name their price. All of the companies, who’s CEO’s opinions you mentioned, literally base their business operations on other companies’ hardware and software, many of which have been 100% remote since their inception. I’ve been remote between 80-100% of my time for 16 years now, and the trend is only accelerating.
Kitten Lopez,
I agree to a point, but when the 40 year old white guys are no longer in a position to demand things, then it’s going to be the 20 and 30 somethings demanding, and they’re not going to want to go into an office 5 days a week either, simply because some stodgy boomer thinks it’s a good idea.
RightNYer, i give you half a “touché” –if it were up to ME i’d give you a full one as i shrugged and ceded defeat when i read what you wrote but the 20 and 30 year olds aren’t gonna be the Pretty Ones Much longer.
it’s not up to me because even though she’s alive, i’m her student and i’ve gotta channel Petunia here and question how much these pretty 20 and 30 year olds will be into bearing the brunt of having even MORE corporate costs externalized onto them.
this is where i shrug as myself and counter with how no one ever seems to even NEED to do The Math anymore.
i think these 20 and 30 year olds who don’t wanna be in the office are psychopaths and Happy Man on here earlier, was showing you WHO’S REALLY IN CHARGE IN THE OFFICE.
people resent rich people who aren’t there and undermine morale. even i know that and i’ve NEVER worked in an office. i know how to control The Room and i know that’s all that matters. it’s a lot of work getting into the headspace to do it right.
that’s what Happy Man had shown.
so how many psychopathic 20 30 somethings can outdo zuckerberg or bezos?
i don’t wanna say i believe heads will be guillotined… but i AM betting with all the life i have left in me, i’m betting on well… i’m betting on a backlash against the screen, even if small.
ripples. decades of ’em…
i can live with that. i come from that.
there’s your shrug, RightNYer. i want your hot 20, 30 year olds to tell the corporations to fuck themselves and i want them to use their brilliance to save where they live and all they love.
i guess this comes down to local vs neoliberal futures. it’s more than just words. it’s all your life your TIME.
who do you serve? / was it worth it? IS it worth it?…
i don’t know… i’m new here, too.
shrug. so i concede defeat after all… because i don’t know nada
so i’ll be sweet in my defeat and give you the full touché just for reading to the end.
x
p.s. to Wolf, i’m have a helluva time not putting in the sex references. they’re not even metaphors anymore so i have to come up with metaphors and i’ve never been the florid poetic type. i write this so you don’t take my sacrifice my pain for granted. i want many many points for this when i fuck up in the future. yeah. i’m German enough to understand the Ledger Brain even more than YOU! ha!
Totally agree. We’re already at the point where lower level workers are required at the office while upper level staff & management work remote. This causes major discontent within the organization which drives inefficiencies and inferior work product. In a competitive market, business will gravitate back to the office model.
The potential consequences for WFH employees are numerous. Software is already being deployed that tracks computer habits for workers engaged online. These programs are now sophisticated enough to follow your every movement – at home! Every website you view, every moment you are away from the screen can be monitored. Second, if WFH becomes standardized why would companies continue to pay exorbitant salaries to Americans? Offshore hiring would have the benefit of paying much lower salaries and benefits (most countries have medical covered so no need for companies to pay for health insurance.) Third, once CRE winds its way down to affordability this trend will reverse and commutes will be awful for those who made rash decisions based on a short term predicament.
The sense of community and camaraderie that ensues from working in a shared space is very important to the psyche of workers. Especially in a demanding or critical situation. This scheme will ultimately lead to even more feelings of isolation and disassociation creating further inefficiencies.
If the trend is permanent then the gig economy is about to sky rocket and we all know that leads to a race to the bottom for worker bees.
Are you a Boomer, just out of curiosity?
Say Boomer again. I dare you. I double dare you!
I am for sure for sure. Smack dab in the middle. Gotta problem with that?
Wolf, you? No, because you aren’t advocating policies and asset inflation that benefits current holders of assets (mostly Boomers and older) at the expense of younger people. Most Boomers, in my experience, are.
I think there’s also a level of myopia regarding work from home and other things among Boomers that the next generation will continue doing things the same way simply because the older generations did it that way.
Just a note on WFH:
I’ve saved my corporate clients millions of dollars while WFH.
Not every WFH job can be outsourced. I work with property owners, corporations and municipalities. I need to go inspect sites in person from time to time. Somebody in India can’t do these things.
Just saying, there is no ‘one size fits all’ when it comes to WFH. I can tell you it made me a much happier and more productive employee.
I’m not so sure. Until some of these cities get the rioting under control, why would anyone want to go back to an office?
I certainly won’t, not without my Glock. May be safe at work but the to and from is a whole other matter.
My Glock 17 comes with me everywhere these days.
Smart but ask yourself, is that how you want to live, in fear all the time? Not me thanks and I owned a three family in Ridgewood Queens in 1980 The area wasn’t very safe then and I got out as soon as I had a child and yeah I’m a “ horrible” boomer
I escaped New York as well because I couldn’t take the politics (as my name might indicate).
And obviously, there are some boomers that get it, but there is a huge divide that this crisis is illuminating, in terms of what level of government spending and what level of Fed support is appropriate to maintain asset prices.
This is beyond the work from home debate!
I live in a small city with not-too-great case numbers, but when I look at the daily maps of case rates by county in my state the highest totals are invariably in non-urban counties. Not just sparsely populated rural farmland, where one or two extra cases per day spikes the pop normalized rate, but decently populated exurbs too. A few truly rural areas do have low rates, but the commuter/exurbs all have rates about 2x – 5x more than my city.
I’d guess a lot of the folks fleeing the cities will be less than happy with what they find, basically a higher concentration of crazies. Right now that means a greater degree of poor mask discipline and dumb behavior that’s leading to enduring, high base rates of infection, but fast forward a year or so to when an actually good, safe vaccine is being distributed and your going to see lower uptake in these communities as well.
I suppose “crazies” has multiple definitions because I haven’t seen anybody out in the country burning down their local stores or jumping onto moving vehicles. I do see elegant homes in gated communities on acre lots for the same price as old bungalows in urban ‘hoods.
To be fair, crazies exist everywhere. Just different flavors. And like Wolf said, people like different places for different reasons. It’s all good. ;)
Of course not. Rural people come into cities to do looting and blame it on locals.
I’m talking about anti-vax sentiments which are (relatively) common in well-to-do subs/exurbs among people who you think would know better. Vaccination rates can lag among the impoverished too but that is often due to poor healthcare coverage or in cases absent parents/guardians so you need to think about who would put up active resistance to a brand new vaccination campaign and what the consequences of spatial disparities in vaccination rates would be.
Are you so sure it’s safe Nick Why don’t you volunteer to be a guinea pig for testing I hate vaccines and my doctor advised me years ago not to ever get a flu shot
Frederick,
I agree with your concerns about the covid vaccine… greed, billions of dollars, and an election are at stake, and you cannot believe anything coming out of this. So I will stay clear for a while and see if it’s safe.
But I think you need to check with another doctor about the flu vaccine. It’s not perfect, it’s only moderately to mildly effective, but it helps and it’s safe. It has saved lots of lives. Last time I got the flu ten years ago, I thought it would kill me, and it took me a month before I could walk up the little hill to our place without stopping and catching my breath. And I’m a fit thin guy. Since then, I’ve been getting the flu shot every year and have never gotten the flu again. With the flu vaccine, safety is not the issue; it’s effectiveness. But even if it’s only 25% effective, it saves many lives.
You have to follow the local, very local news for that. CNN is not going to report the local store burning down in a rural area. It’s not protestors burning stores and houses down here though. It’s angry feuding neighbors or drug deals gone bad. Rural and suburban.
Mayberry just isn’t what it used to be. And the sherriffs are now on a tight budget since they all bought their “Bearcats”.
Is there really enough available housing stock in the burbs to accommodate a significant population shift out of urban areas? It is not like right after WWII when the endless potato fields of Long Island and orchards of the San Fernando Valley fueled suburban growth.
There are over 17 million vacant homes in the US according to the Census Bureau.
I’m sure there is but those aren’t the homes that spoiled kids want They are older homes in need of sweat equity like the one I bought in 1981 for 55k renovated and flipped a year later for 175k But it was hard , dirty work trust me Not for everybody
Robinhood investors meme in a different market ecosystem. House is also a speculative property like stocks or gold in a different format. If 2008 GFC comes out during the time millennial went to the job market, this 2020 covid arrived at a time when they want to settle down after marriage and kids. Add the inflation, FOMO, job security or desire to live in a house. Others also want to buy a house but did not have the capitol or qualifications or risk-taking behavior. Deep down a lot of people here or outside, already own house(s). They want to see the housing market in distress. Only time will tell who is the winner.
Maybe I’m missing something, but if people are leaving cities, are they selling their homes or apartments in the city? Is someone buying these? Or are these people the wealthy that have more than enough momey to take on an additional mortgage moving to the burbs, country side? I get that there might be renters moving to cheaper areas but I can’t imagine the homeowners in the city are fleeing, since they’d need to sell their home for a loss ( assuming nobody wants to live in the city anymore ).
Darwin,
There is a surge in vacancy rates of rental apartments in those cities, hence the plunge in rents, and the surge in incentives… a sign of renters that left.
In terms of homeowners that left: anecdotally, from people that I know who left the City, they bought first elsewhere and moved, and they’re in no hurry of putting their property in the City on the market since prices are strong, and they’re hoping for more gains before they sell. Credit is easy and cheap for people with money these days. One couple I know paid cash for the second home without selling the first but will sell it eventually.
All of this RE thrashing is a double-top, Knife catcher’s convention, fueled by low-interest rates. RE is still massively over valued EVERYWHERE, when measured against wages.
When the real layoffs start, after the election and the expiration of the PPP, which is Oct. 1st, we are going to see a screeching halt to this panic buying. Job insecurity will set in at all levels. Many of these recent purchases will be in default in 2021.
As for all the company men who have signed on here to talk about ‘getting-back-to-the-workplace’ crack-the-whip or I won’t invest nonsense, American corporations are debt dinosaurs, crashing to earth after the massive asteroid strike called COVID-19.
Even before Covid, Seattle was in the midst of the Biggest commercial RE over-build in the history of a town that has had big overbuilds before…. Now that Amazon is moving to Bellevue, Seattle is going to be a ghost town, China-style.
The debt-hidden Depression that we have been floating along on since the GFC, AKA the Obama mirage, will come crashing down when the CMBS market starts defaulting on the overwhelming amount of bond debt that has been created.
Exactly
1) In the next few years silicon valley will be extracted from SF and disperse. SF will become a hollow, empty shell, like in 1975.
2) Analog #1 : Jan 1976 Jimmy Carter inauguration. Next : a plunge all the way down to 1966(L) support line.
3) Accumulation until the 1982 spring, at the lower half, sent the market to the 1998 & 2000 vertical.
4) There is no guarantee that we get a new vertical up. The markets might trade in the upper half, in distribution ==>> we will get an inverse vertical. SS will not be distribute to real babies and baby boomers.
5) Analog #2 : a low slog up followed by a vertical rise. Vertical up // vertical down. How far it will go nobody know. Your SS, when u will be in your 80’s, might be gone. 6) The real value of stocks, in 1920’s Germany, was only15% of their real value. // Utopian nominal prices // 85% losses during the hyperinflation period. Deflation and high inflation destroy value.
7) Wall street moved in, bottom fishing, until the late 1930’s : u could get in, but u cannot get out. That’s China.
8) The two analogs might be wrong.
I call bullshit on this property boom, these numbers are manipulated & skewed cuz so many wont move during a virus, people maybe selling their million $ apartments & buying rural homes or whatever, this market is gonna crash, I wouldn’t trust a single figure these people release, it’s simply not possible for property to be up or stay up, it’s all a scam just like the stock market & will end in tears & a lot of corruption being earthed, anyone who finds a reason for these moves is kidding themselves, all markets will crash & burn, those who wait, can wait, should, no banks are lending so this could be a blip as a few rich city folks scramble for homes, they ain’t blind and can see the US cities decending into chaos, no way in hell are these moves gonna last, if they are real which in Trumps America every number is corrupt & manipulated.
I agree the numbers are fudged but they were no better under Obama or Bush. It’s what they do, and Trump has little to nothing to do with it What do you think the numbers would be like?
I moved from London to a village in Thailand.
I was getting internet speed of 21Mbps in London, but in the Thai village I am getting 680 Mbps ( 30 times faster).
I managed to build a two story house/office of 3200 sq ft for US$50,000.
No BLM protests, no vadalism, no burglaries and people seem happy and not aggressive.
3200 sf for 50k Couldnt do that here in Turkey More like 75k and land isn’t cheap in touristy coastal locations anyway Too many Brits bidding everything up ?
Then there’s the infinite supply of Thai food which makes it worthwhile.
US$50,000 or about A$70,000…………….
Where I live in the magical land of Oz where no one is allowed to travel more than 5 kilometers from your house and a curfew still exisits, the cheapest dwelling for sale in my suburb is now a townhouse with three bedrooms on a 163 square meter lot for A$500,000.
The cheapest actual house that I could find for sale in the state of Victoria is A$75,000. For that price you get about half an acre and some sheds. The house and sheds need repairs.
It is located 206 miles from Melbourne in a town with a population of 184 people. Public tranport is a bus once a week.
Even Japan has cheaper real estate than Oz. You can buy a really decent house on a decent block of land in a city with reasonable infrastructure anywhere from A$125,000 up.
I used to spend lots of time looking at places for sale there and the range of properties for is huge.
From the US$10 million dollar condos in the big cities to a small house in Hokkaido for US$5000!!!!
“I moved from London to a village in Thailand.“
Sounds sketchy.
Like Brad K said the cities have increased violence and crime. In San Francisco burglaries are up 42% (SFPD crime data) in the last year. Throw on top of that Covid, increased homelessness, and expensive rent, and some people want to move out.
In California, Oregon and Washington State, has a double whammy, wildfires. So it looks like the suburbs are the sweet spot. But if you go out too far you run into the urban/forest interface, with possibility of forest fires reaching your suburban home (re: Santa Rosa Ca. a couple of years ago, and Redding Ca.). Let alone moving out to the country proper, surrounded by beautiful trees. California still has 8 million or so acres to burn.
Also, a friend has two cousins who lost everything in the Paradise fire. He still wants to retire into the country, even those with all these fires around here. He said he would just make sure he has a built in fire clearance.
I lived in the Santa Cruz mountains for 25 years, not sure I want to go back? I suppose you could move to the country where the fire has already burned in the last couple of years?
It burned into the city itself in Santa Rosa. Also burned to the beach in Davenport.
It’s either mosquitoes or fires. AK 15’s and 4×4’s or protestors.
So many comments on the sizzling’ housing mkt. But where are the jobs with or above living wage levels, to support those housing? Matters little if they are in urban or in suburbs!
How many will afford to keep their houses by next year, by this time?
See my detailed reply to Michael Engle above!
‘We are NOT in Kansas any more’!
I think there’s a lot of shadow flipping to keep prices high. Unfortunately, this raises the RE taxes too. There’s going to be a lot of collateral damage when it turns.
Doesn’t matter if there is shadow flipping (+ money laundering) ultimately ability of home owner to continue to ‘service that debt’ ( and other personal/household debts- auto, CC and student loans) along with RE taxes, insurance etc, is the crux of the situation.
Not now, b/c of furloughs and deferred (not forgiven!) payments.
Can any one guess, who will have (pre-covid)their job still, by middle of next year?Per YELP almost 50-60% businesses are permanently closed, as of now.
How many of tourist/hospitality industries come back? Are you reading the plight and future of airlines? hotels? cruise lines++etc
How many industries besides Banks, taxpayers are ready to bailout?
Watch for demand for ‘wealth’ tax next year. Mind you this is worldwide disaster affecting the global commerce. BTW, covid-19 is NOT going go away by next year or two!
Actually, the shadow flipping, house hoarding and money laundering do affect us. The US is one of the most popular places world wide. Every time RE prices go up the homeless percentage goes up. It’s demoralizing the entire country.
Anyone who turns in real assets for paper assets has a screw loose
screws loose and nothing making sense: THAT’S THE POINT. / this is mass suicide and no one CAN change a thing for real, because to do so is to summon the lizard people.
SUNNY129:
part of the reason i’m like this, ghetto-bougie, is because early on i realized there were levels of reality and b.s. that i was supposed to navigate seamlessly while also being the darkest one in the room.
that’s why i want to work with Petunia on The Future: because Petunia has an invaluable sixth sense that borders on freaky, when it comes to who’s gonna get gang raped by the pitch.
but don’t pay too much attention to regular media. they are part of the anxiety necessary to keep us twitchy and on the drip.
the story of Wolf and me becoming friends is another odd thing because i KNEW he was gonna ask me to work for him long before he did, BUT I DIDN’T WANT TO DO ART FOR ANOTHER WHITE CAT WHO’S GOT IT ALL THE SAILBOAT LIFE THE GORGEOUS WIFE… PLEEEASE! I AM FOR MY PEOPLE!
so i AVOIDED him and knowing him, but he showed up at Carnaval a few years back when i casually said come over just to be nice since he was local (no one takes anyone up on anything anymore ever since the magic phone, as no one is in the WORLD anymore).
but Wolf showed up and he saw me dancing and introduced himself and didn’t look at me like a freak. he GOT IT. he got every minute of me.
and then he brought his WIFE the next year and i was smitten because they’re both All Love.
and it’s in this site, even though we’re supposed to pretend this is all about money. money is how we play our our VALUES. that’s what my mom used to remind me money was. that’s all it was. nothing more than that. and that budgets are how you make dreams come true.
i can budget like a motherfucka, too.
anyhow, so i wanted to be For My People, but my RULES are that if you make it past all “THIS” that i am, all the bluster and “deft” sidestepping any commitment (i can feel a question coming when i first meet people), if you can make it past all my distraction and bluster, you’re in. i’m weak and helpless from there, you might as well walk into my heart and put your feet up and take over the remote control as many do. it’s okay. i love it… here’s my masochism playing out maternally.
anyhow, so Wolf offered real money for art so he wasn’t just trying to take advantage of my art. art’s different for me now that i’ve died as i was: it’s magic to me and i can’t do art for just ANYONE. it’s an act of love and creation to get into investing my heart my skills my hand and time and imagination into…
and doing art is like 3rd base. if i’m connected forever just by a mere kiss, then doing art is marriage and divorce with lots of embarrassing cop calls and no shame.
but everything is CONNECTED because i did art for free as my donation to the ..well, i think i may have said Stone Soup. the story about the rabbit who invites everyone for stone soup and they ask what they can bring and he says, “oh nothing, we’ve got everything we need more than enough! …but if you could bring some carrots that might be just the thing!”
and he says that to everyone he meets and all he ever added was the stone at the beginning, but as everyone showed up with their gifts, they had a feast a bounty.
and then there’s the good old story about hell being full of starving people with lots of food and really long chopsticks, starving as they haven’t learned to feed each other in order to thrive.
both apply. i see why Leonard said we’re on our own now. we knew all this long ago. / we know it now.
point is don’t believe the media.
because now Wolf and the life found on this site, it is my offering to try and use my talents to try and help manifest many of the formerly wasted minds and ideas on here.
like my mind was made small by these binary left/right democrat/republican forced FORCED ARGUMENTS. you all KNOW we and life is way more complicated than that.
i say this to you here because my James is blue. he feels that as a man with a brilliant mind and great ideas, he is wasted in this society. it breaks his heart. i cannot love him enough in these 400 sf to make him feel used and necessary.
but i can love him enough to try and change the WORLD, our little piece of it, so that he may find a place in it to shine and enjoy life.
all this hell is because of our emotions. our FEAR. i fear too. what will i say when my bluster is gone? and it’s going going gone because even i cannot afford that now. i must BE defibrillator, even as it’s exhausting and i’ve so much to do.
but each moment is the doing. not some grand scheme in some imagined future.
so i am glad that i got past my own racist tendencies and my own self hate because i’m not only colored i’m part GERMAN. more than the French. i GET German stuff. i feel calm with on time THINGS. you can not be a freaky artist girl without crossing your…well, DOING THE MATH.
that’s why i know Regular People are in their emotions. because as the one getting it dry if my math is wrong… i wanna check my work, dig?
so you won’t find these under on-the-low stories of how Wolf has become a dear dear friend and EDITOR of mine by accident, and i have to go with whatever comes up for Wolf Meets in the future.
because THAT is ultimately how i can help “My People”… other poor folks the scrappers the freaks artists …the ones who still feel emotions… i can help them by going BEYOND these binary choices and the divisions they seek to rent between us…is that the word? … no time to spell check… but i can help “My” people when i remember you ALL are “My People.”
so if i can broker new alliances between unlikely interests that are in actually nothing BUT ALIGNED in reality, then COOL.
we’re too far apart. and in extremes i’m Extreme Girl. i’m comfortable here in extremes. thanks Lou Mannheim for what you said about us being where the good times are.
things are gonna get hella scary, but this is where Petunia and i shine. we’ve defended our hymens in the alleyways. you want us. you want the ones who made it past the fetal position existential screams of what’s this all about…
it’s TIME. i’m not a witch. i just smell different things than money.
i smell baby green shoots and i’ve not been this optimistic in a long ass time. and fuck looking for the government to get it together. i come from revolutionaries and quakers who kicked my ass. i’m living proof we’re ALL living proof that we’ve got it together at HOME before we change even the potted plants on our front porches, let alone the problems of the world.
as Neely Fuller said… “WE’RE NOT SUPPOSED TO GET ALONG, Y’ALL.”
what would happen if we DID?…
Unamused said no one was asking The Right Questions. i’m still working on that one…
but i’m not counting people out even though i’ve been out of love with humanity for the better part of a decade. i’m falling in love and surprise again.
so don’t believe the hype, Sunny129. all you can do is what YOU can do. the moment you think locally, even as far as your next door neighbor, it’s amazing how fast your optimism and romance in humanity will come back. i’m grandiose and now that’s the ONLY thing that can cheer me up when i see the pain and agonies regular people are gonna go mad from. because pain bad enough makes you mad. / some many won’t come back. i almost didn’t.
in fact, Wolf’s site here is also a blossom from his former blues.
x
Wolf you cling to this media concocted narrative like a giddy schoolgirl.
Manhattan vacancies are hurting because so many jobs were lost. Restaurant, hospitality, tourism, leisure, etc. It’s that tragic and simple. As soon as the virus subsides, likely by mid next year, things will start to steadily improve. Even now people are slowly returning as safe office protocols are introduced.
The whole WFH thing is VASTLY overblown. It’s a trend that has existed for 20 yrs and it’s not going away but work is STILL work and the office is STILL the office- as long as it’s safe.
Walter Ego,
Yeah, like all the people who work in hotels, restaurants, and tourism can afford to live in Manhattan, one of the most expensive places in the US. Duh!!!
The apartments that are vacant rent for $3,000+ The high end — a lot higher than $3,000 — is particularly troubled.
I mean, DUH!!!!!!!!!!!!!!
I get first hand reports from Manhattan from my son. He says a lot of people left when virus was bad and are living in alternate locations waiting for things to return to normal whenever that may be. He is leaving when his lease runs out to try to save on rent til his job requires him to be back which he things will be in August.
$3000 isn’t high end in Manhattan. It’s avg rent or was at least. There are thousands of middle incomes jobs lost in Manhattan from those sectors mentioned.
I don’t suspect the 3rd year Wall Street lawyers who lived on the UES in an elevator buidling are packing up and moving to a split level ranch home in NJ do you?
Seems to me the pandemic has moved the demand forward. The millennials with a new baby in a 2 bedroom all decided at once to leave the city and find a house in the ‘burbs. They’d been thinking about it for a while and always planned the move so what better time than now?
But their nice apartment will be leased up when things slowly return to normal and the virus risk subsides. I fully agree it will take some time, 6-12 months minimum.
Statistics are going to be difficult to interpret as well. Some people will keep a NYC address at say a friend’s apartment so they don’t get caught between two states fighting over taxing their income.
This is not a blip. I have been traveling coast to coast last four weeks and can tell you these cities didn’t get frozen in time, ready for your return. Everything is out of business or gone. You won’t go back to Denver or ny and have the place you left. It will takes years. They all remind me of Times’s sq in 1975 right now. I also have an apartment in ny and rents for one bed are down from 3000$ to 1700$ In nice areas. Some younger tourists (25-40) are returning to tourist friendly sunbelt, already booming cities like Nashville or Austin but anything larger is toast – the gangs are running the street corners and you can’t walk two blocks without being “asked” for money. No police in sight. There are enough wfh jobes now if you like staying home you can and if you want to go to an office you can pick that job. I suspect some ratio of 70/30 vs 15/70 work from home vs an office. This is the biggest mobility and demographic geo shift since the great dipression