Bidding wars in the suburbs (part 6)

Is this the last thread in this series, or will spring bring more covid refugees to the suburbs and beyond?

https://www.nytimes.com/2020/10/02/realestate/nymarket-still-down.html

"Sales in the suburbs are also plateauing, indicating that the outbound migration from the city may be waning. The number of new contracts signed for single-family homes and condos on Long Island, for example, was higher than 2019 levels, but the spike in sales seems to have topped out in mid-July and has been declining sharply since then."

I didn’t read it, but there was another article yesterday on WSJ.com about pandemic refugees taking shelter in Aspen. It will be interesting to see whether those prices hold up once the dust settles.

George, The worst is over. We will certainly get some increase in corona cases in the fall but the death rate is getting lower possibly due to a combination of virus weakening, more people with antibodies, and improved medical treatment. Offices are slowly opening in person. Schools are open and hopefully will remain open in some capacity.

IF the only thing causing an increase in sales in the suburbs was people fleeing the city due to coronavirus that's a classic bubble market.

As has been discussed, it's far more than covid refugees. But many of the people are families whose lives revolve around kids and school years. So I wouldn't be surprised if numbers trend down for the next several months, people write it off as a one-time phenomenon, and then there a huge spring in Nowhere.

Well that was fun. But now, the NYT has officially declared the suburban boom over and NYC real estate on the way back. Take that, 30.

https://www.nytimes.com/2020/10/09/realestate/new-york-city-real-estate-return.html

Ha. I am seeing clear signs of stabilization In resales with the volume of transactions increasing from the dark days of March-August. First step is transactions taking place and price discovery to happen and it is happening right now. My guess price 3-8 percent off pre-Covid for resales of say more than 10y old non-ultraluxury building.

One deal that I followed in a suburb of New York (Rockland county), just north of Manhattan was very telling. I knew someone who was bidding on a home last November, very strong buyers market. The home had been on the market over 500 days, and it was a real beauty. They had been dragging out the negotiation as they continued to grind the seller down on price. Long story short, covid hit, panic buying ensued and this home soon had multiple bids well above ask.

The only thing worse than trying to catch a falling knife, getting that knife shoved right up your backside as you compete with other frenzied buyers thinking 'buy now or be priced out forever.' But I understand the psychology, most people have trouble buying real estate and stocks when they go on sale or even worse it feels like the world is ending.

Is this the absolute perfect time to be buying real estate in New York City? Probably not. But I think it's a heck of a lot better to be a buyer now than it was in 2014/2015. And I'm speaking to people who prefer to own versus rent.

Keith Burkhardt
The Burkhardt Group

Well, George, I believe I said the boom in the suburbs could be a flash in the pan more than once, and the numbers still point to more pain here rather than recovery. Looking at us still heading towards supply greater than the absolute peak during Great Recession shouldn't have anyone cheering. And all the new development deals I'm hearing about recently are at huge discounts (listen to Talking Manhattan interview with Ryan Servant and pay attention to the new dev deals/discounts he rattles off).

Not so fast, says WSJ. Leave it to them to contradict the NYT at every turn:

"Now, many real-estate analysts suggest the shift to the suburbs could continue. Work from home remains widespread, and prices in the suburbs still look relatively cheap. Even with recent rent reductions in urban markets, upscale city apartments still command a premium of up to $2,000 a month over surrounding areas, according to landlords and brokers."

https://www.wsj.com/articles/renters-flock-to-suburbia-upending-decadelong-urbanization-trend-11602581401

Meanwhile:

"Weeks turned into September. Then September turned into January. And now, with the virus still surging in some parts of the country, a growing number of employers are delaying return-to-office dates once again, to the summer of 2021 at the earliest.

"In the past week, Microsoft, Target, Ford Motor and The New York Times said they, too, had postponed the return of in-person work to next summer and acknowledged the inevitable: The pandemic isn’t going away anytime soon."

https://www.google.com/amp/s/www.nytimes.com/2020/10/13/technology/offices-reopening-delay-coronavirus.amp.html

I just made a big bet that suburbanization will continue. This is a generational change. Covid is scarring 20-somethings the way 9/11 scarred my generation. It caused us to rethink everything. Including where to live. But the difference is that we beat there terrorists, and people are still dying of covid.

Some countries are doing well on developing the Trump Virus vaccine, this might help the US eventually.

Bidding wars still going in Montana despite the surge in virus there. I only know one person who has moved to Montana: a tech CEO. People will follow him.

https://www.washingtonpost.com/national/coronavirus-montana-escape-property-gold-rush/2020/10/20/9e36e858-0340-11eb-a2db-417cddf4816a_story.html

Montana is beautiful if you like natural beauty, peace and quiet. Most remote working dreamers will be back as they see their salaries being cut and career progression limited.

https://www.npr.org/2018/07/12/626693116/riveting-documentary-sheds-light-on-dark-money-in-montana-politics

I'm not as convinced as you about the idea of salaries being cut and career progression limited. First, for executives, there is a global market for talent, and compensation does not vary significantly between any location on the planet. Salary differences exist at the lower ends, where a secretary in Westport will make 20-30% less than a secretary in the city. But secretaries follow jobs, so the real question is where rich people are going, or where they are sending jobs. There was already a lot of Boardroom talk before covid about getting jobs out of expensive coastal cities and finding new hubs in the interior. This is only accelerating.

As for career progression, the main variable is how established one is in his field. A 40-something with 2 kids who has 20 years of training and experience, in occupations that aren't naturally tied to a specific place (such as a real estate agent), can work from anywhere. That might not be possible for a 25 year old. But if these established people move, you can expect to see more companies setting-up offices in places where the bosses have decided to live, whether that's Morristown or Missoula.

I've been going to Bozeman, Montana since the 80's, beautiful country for sure. Still plenty of places throughout Montana that are affordable, but living there full time, no thanks.

I've been looking at real estate in vermont, the Cape, North Carolina, Tennessee, New York State and there's still plenty of affordable properties throughout nowhere USA. There's really no reason to buy into a market that's bubbling up based on a temporary problem. This isn't the first global pandemic and it probably won't be the last.

Every time I really come close to buying a house somewhere in the 'country', I look at the yearly costs versus doing an Airbnb, that keeps me from browsing Zillow for another 6 months.

Anyone have the actual statistics on the percent of New Yorkers actually leaving permanently? I believe the current metro New York City population is about 18,800,000.

George,
I personally know people who had to take 30 percent pay cut on a 7 figured salary+bonus to work remotely 3 weeks a month. Pay cuts are real at all levels if you want to work remotely and your job mobility is limited.

Parking garage attendant down the block said all his monthly customers came back around Labor Day after clearing out over the summer. My informal survey of lit up apartments at night squares with that report. These are mostly owners and not renters, for what it's worth.

I am seeing more people come back too. I think almost every one who has not permanently left the city will be back early next year. And I am seeing empty nesters selling their CT homes they couldn’t sell before and moving into NYC.

NYC is too crowded

Keith, did you ever consider the Hamptons.
The air is rarified there and there’s a whole subset of people there that are really into the environment and nature.
I learned how to windsurf there and fish. There are so many farms to buy the most incredible organic produce or maybe do your own farming.
And certainly you can always get a rental for part of the summer to help with expenses.

Buy some land and build or buy a tear down.

Given that NYC is still a 'big finance' town, one element of whether and when people will be back is whether the securities regulator, FINRA, will make permanent the relief they granted that permits traders and other licensed individuals to work from home. (has to do with technical definitions of 'branches', 'offices of supervisory jurisdiction', etc, and related rules for those things).

@flarf: My former garage (I gave up my spot), still is not back to operating 24/7. Still a lot of monthlies not back yet.

https://www.bloomberg.com/news/articles/2020-10-19/with-nyc-influx-greenwich-area-home-prices-rise-fastest-in-u-s?sref=5WyK57cE

Streetsmart I love the Hamptons and especially Montauk where I've spent quite a bit of time surfing since I was a teenager throughout the year. I have a number of friends that actually wind up buying places there in the '90s, when you can get a pretty cool summer house for a couple hundred grand (near the lobster pot). I guess that's technically Southampton.

Apologies for the grammar...

I don't know the extent of people who left manhattan. But in my large rental building in midtown, I've never had to run the hot water in the shower until the past month.

N.b. My landlord sent a no-change renewal offer with "hopefully we can come to a mutually acceptable agreement".

Tell them "Eddie I want half. Half, Eddieeeeeeeeee..."

Is it just me, or does anyone else think George is actually communicating with us from 1962?

“ a secretary in the city”
I think secretary jobs went away long ago.

“As for career progression, the main variable is how established one is in his field.”
His?

“A 40-something with 2 kids who has 20 years of training and experience”
What do the 2 kids have to do with it?

Some signs of life at my bellwether Prism. First, my beloved wayward studio has finally found a person to spend the next year-and-change with:

https://streeteasy.com/rental/3056653

Second, inventory is down to 31 out of 269 apts. Peak was 46-49.

Is this a healthy market or something else:
https://therealdeal.com/miami/2020/10/19/billionaire-rockstar-energy-founder-flips-elin-nordegrens-former-north-palm-beach-estate-for-48m/

Inonada wrote:

“ a secretary in the city”
I think secretary jobs went away long ago.

--> There are 3,638,800 of them in the US, says the BLS.

“As for career progression, the main variable is how established one is in his field.”
His?

--> Such is proper English grammar. BTW, in French, why is the word for vagina masculine?

“A 40-something with 2 kids who has 20 years of training and experience”
What do the 2 kids have to do with it?

--> Typically people with kids are considered less mobile than the 25-year-old in my example, who presumably does not have kids at home.

To 300's comment, "Pay cuts are real at all levels if you want to work remotely and your job mobility is limited." Of course, if one gets too high on the pay scale and does not continue to grow his value ("job mobility is limited"), then any change he makes is going to result in a salary cut. I know guys at banks here who can never change their jobs because they're overpaid but the bank hasn't gotten around to unilaterally whacking their salaries as the market for whatever they do has become automated or shrunk. The time I've spent looking at executive talent says that it's a global market with global prices. While Facebook's pay-cut plan has attracted attention, it is the exception not the rule.

I think there is a decent chance as the fallout from COVID-19 increases, it becomes more obvious that fig fish are going to go after each other because there's not enough juice left to squeeze out out the bottom 95% anymore
https://www.bloomberg.com/news/videos/2020-10-15/howard-marks-fed-and-treasury-are-taking-extraordinary-actions-video
and the Fed can't just spend us out of the hole we have dug for ourselves, not only are we going to see companies shed very expensive office space
https://therealdeal.com/2020/10/20/cushman-wakefield-paints-bleak-picture-for-manhattan-office-market/
but also shed executives who haven't proven they are pulling their weight lately
https://therealdeal.com/2020/10/15/jll-makes-cuts-to-i-sales-team/

FWIW, I’m with 300 on the remote worker front. Careers for remote workers do take a hit: productivity is just lower because the organic interactions are not there. It might be a small hit, say 10%, but if your career progression depends on “compounding” of productivity, that builds up. I’m not saying people shouldn’t work remotely, but they should acknowledge the reality.

In any case, I am rather enjoying the exodus as I am starting up my rental search for real. I’m with 300 & Keith on this one, seems like an overreaction to a temporary problem. However, it’s resulting in jaw-dropping rents because the George’s of NY are stampeding to Montana.

As one example, there’s a place in the West Village that last rented in 2016. It had an asking annual rent that was 3.2% of the early-2013 purchase price, which is as great a deal as you’d find in 2016. Unsurprisingly, it spent all of 9 days to come on the market, find a tenant, negotiate, sign the lease, and get removed.

This time around, it’s been sitting on the market for months. With a recent 30% price cut, annual rent is now at 2.3% of the purchase price. Properly described as “a trophy apartment”, but well within budget of the higher ends of the “mass affluent”. For those that remain and haven’t splattered their housing dollars around, I guess.

Nada, There are indeed fantastic rental deals at all price points. For buying, perhaps 5-7 percent down on an average vs per Covid in Manhattan unless you are looking at new developments, high $ say $5mm plus or high $ per sq ft.

I only feel George is from 1962 when he brings up and praises Nowhere again and again.

But inonada, maybe you are too advance in the future. There are tons of secretaries in NYC, and normally they are the last one to cut int he team during each round of layoffs. That is one of the reason NYC is no longer a good place to raise 2 kids for George's friends

@Keith,
So if you love the Hamptons, what’s holding you back?
Ditch Plains in Montauk really became big as the entire town of Montauk became big. The windsurfers go to Napeague harbor. There’s a mobile home community in Montauk on the ocean where the homes can cost over a million depending on the proximity to the ocean and views.

Don’t know if you have ever heard of Alan Schneider. But he came out to the Hamptons in the seventies loved the area and started a real estate firm. He told everyone that he was Protestant and came from a wealthy family and that his parents lived in a castle in Germany. He became the most successful broker in the Hamptons, and that was no small feat as the big entrenched WASP firms had a firm grip on the market. To make a long story short , he died in 1991 as he was big on food and drink and hard work. And it was only after his death that it became known that he wasn’t a rich Protestant but was Jewish and even had a half brother that was Hispanic.
I suggest you read Steven Gaines,”Philistines at the Hedgerow”, the first chapter only is devoted to Alan Schneider and how he made it so big in the Hamptons, it’s a page turner.

But again think about buying there, I saw today a few articles in the papers indicating how strong the Hamptons market got since the pandemic, but the market always did well. And from what I see there are places to buy that are still reasonable.

This article indicates that more people headed to the NY Metropolitan area than moved out.

https://www.bloomberg.com/news/articles/2020-10-21/new-york-among-top-cities-for-relocators-during-the-pandemic?sref=5WyK57cE

I am going to preface this post by inviting George to correct me if I am off in the following perception:

I think I "get" George. I suspect he is settled in a world where the patriarchal bargain is still alive and well, and that contingent is a force to be reckoned with. Some really smart men and women who have a set of values that make sense to them and have as much right to exist and vote their preferences as anyone else.

My female friends from college are split between (1) those who gave up their high powered careers because they found them devoid of meaning and their true passion lay in raising their children and (2) those whose independence and professional identities are as important to them as their family life.

The two groups each married men who were on board with the costs and benefits of whatever philosophy the woman chose, and the only thing I will say is that those in the contingent that chose to give up work are the ones who are most likely to use the traditional old school grammar, in which "he" is the proper pronoun when referring to the third person in a general sentence.

Please note that in describing the two groups of above, I make no judgment as to whether one set of values/priorities is "right" or "wrong." While I have one set of values and tend to gravitate towards those with similar values, I absolutely respect every individual's right to believe what they believe and live accordingly (as long as their actions are within the bounds of the law).

@streetsmart - Alan Shneider sounds like he found Slim Aarons playbook.

30's comments that suburban homebuying is a "flash in the pan" that will quickly evaporate in the fall are not yet being borne out in the data. Quite the opposite right now.

https://therealdeal.com/2020/10/22/existing-homes-sales-remain-high-but-inventory-is-historically-low/

From the article:

In September, 6.5 million homes sold, seasonally adjusted, a jump of 9.4 percent compared to August. Sales were also up 21 percent year-over-year.

While demand is high, supply is low: Existing housing inventory sank to a record low of 1.47 million, which would be sold within 2.7 months at the current sales rate.

The median sales price continued to climb, clocking in at more than $311,000. The median sales price for existing homes surpassed $300,000 for the first time in July.

71 percent of the 6.5 million homes sold were on the market for less than a month.

I'm familiar with Alan's story, certainly an interesting and fascinating one, as well as 'Philistines at the Hedgerow'. Although I agree it is possible to find an affordable house in the Hamptons, I have zero interest in living there, I've always felt very claustrophobic there. I've spent most of my time out there in the fall and Spring, which also happens to be the best times to find surf! Growing up, I spent my summers in a small Beach town called Mantoloking in Jersey, where my grandparents had a place, we would also do road trips (starting in the) seventies out to Ditch Plains to surf, since Long Island runs east to west, winds\swells that are no good for the Jersey Shore can produce very good conditions on the island. These days I spend most of my time in Florida, mostly because my youngest daughter has Type 1 diabetes, and it's much easier for her to live down here. This hasn't always been an easy adjustment especially since I run a business in New York City, but we made the decision based on the health and well-being of our daughter.

I find the WASP / Jewish history very interesting. I come from a mixed family, quite a bit of diversity and also quite a bit of division. However, holidays were always very Lively and interesting!

Maybe if I win the lotto I'll buy a house out on Further Lane, but first I'll have to start playing the lotto!

Keith
tbg

I remember saying "flash in the pan" but where did I say "that will quickly evaporate in the fall"? RE markets rarely change that rapidly, even for "flash(es) in the pan."

(leaving out that I believe I qualified the whole thing with "could possibly be" or "could be").

>> There are tons of secretaries in NYC, and normally they are the last one to cut int he team during each round of layoffs.

I guess I haven’t ever seen a job title called “Secretary” in my adult life, but more rather “Administrative Assistant” or “Executive Assistant”.

>> I absolutely respect every individual's right to believe what they believe and live accordingly (as long as their actions are within the bounds of the law).

That’s all fun & games until their antics leave you exposed to lawsuits as their employer.

The very first case I worked on right out of law school involved a female investment banker's suit against her employer. This was back in 1994, and what shocked me the most was how pervasive the hostile environment appeared to be in the finance industry at that time and how much employers in that industry were willing to pay out to the targets to maintain that culture.

I was on the defense side and felt like a physician trying to treat a patient with lung cancer who insisted on chain smoking even during appointments.

I sure hope that has changed, but virtually all of the men I know in finance married women who are not only fine with their husband's use of old school grammar, but who use it themselves, and I am particularly distressed that I don't know any women in finance.

Guess I'll have to bring my wife to StreetEasy Poker, then.

I've been privileged to only ever marry women smarter & more accomplished than I.

MCR,
Remember what the market was like for newly minted attorneys back then? (Or am I off by a year or two on either side of that?)

When I was hired we were in a recession; an unprecedented number newly minted attorneys could not find jobs. I started at one of high flying firms that had historically had classes of first year attorneys in the double digits. My year there were only 8 of us.

Then, in 1995, everything took off. Our salaries literally doubled in the next year. By 1997, there was an insane demand for mid-level associates (because the recession of the early 90's had decimated the pipeline). Head hunters stalked you if you were one of the few who had landed a job during the recession. It was pretty awesome, except for the volume of work that needed to be done with too few bodies. I think I have PTSD from the exhaustion that plagued me during those years.

And then . . . the music stopped. I was in San Francisco from 1994-2001. It was a dizzying but magical ride.

@RichardBerg - Outstanding. I do think you and Inonada were separated at birth.

P.S. @RichardBerg - I am curious as to whether your male colleagues resent you for it? I have to say that my relationship with my colleagues was disastrously altered for the worse when I got married. They were all like "Not fair! We thought you were one of us. We are raising families on a salary that is just a rounding error of your spouse's paycheck. BOOO!"

What was even more distressing was my next boss' reaction when she met my husband. I had not mentioned him during the job interview and always wore just my plain wedding band with no engagement ring. She was almost angry when she met him at a mandatory work-dinner-party-with-spouses because she had assumed that I was the primary breadwinner (I said nothing to lead her to that assumption).

In short, I hated it that my husband's success had a genuine negative effect on others' reaction to me in the professional world, but I also absolutely understood it because during the exhaustion years, I really resented my colleagues who had stay-at-home-nurturing spouses. They went home to an awesome and orderly home with food and magically clean clothes, sheets and towels, whereas I went home to an empty refrigerator, stacks of unopened mail, a hamper perpetually overflowing with dirty laundry, and always at least one light bulb that needed replacing.

@Keith,
So sorry about your daughter. Do want to mention I am totally into health and fitness. I respect Andrew Weil. But whether you like him or not I do think a plant based diet with no red meat (I don’t eat any animal protein) could be real beneficial for your daughter; focus on anti inflammatory. Somehow I feel animal protein could lead to autoimmune problems, just my personal theory.

That said, did you ever think of getting a mortgage broker license? I could have gotten a license in the state of Florida just for the asking years ago since I was licensed in the state of NY but missed the deadline as Florida banking dept. is far easier on the compliances.
After a few years, you are eligible to get a banking license.

@MCR
Don’t think Alan Schneider would fit into that playbook, didn’t see him as a jet setter type of guy.
He loved houses, knew everything about them from a builders standpoint, he worked very hard, and he brought a sense of style and class to the real estate business in East Hampton. He even would throw a fit if he saw a styrofoam coffe cup in his office, and at that time they were acceptable.
After he died and his parents came up to East Hampton from Florida, the brokers who met them could tell just by observing his parents that Alan misrepresented his background. Of course when they told his parents that funeral services would be held in the church, his parents exclaimed, “but Alan is Jewish”. And the cat was out of the bag.

Slim Aarons was the son of Jewish immigrants and was raised in poverty on LES. He represented himself as an adult as being a WASP from New Hampshire who had been orphaned at a young age, maybe with a trust fund. Check out the documentary "The High Life" https://www.imdb.com/title/tt6865728/.

And, like Allan Schneider, none of Slim Aarons' WASPY inner circle (including his own wife) had any idea of his true ancestry and upbringing until after he died.

MCR, when I was on Wall Street I always used to say I needed a wife; it was a common thing for all the women on Wall Street to say.

ali r.

Thank you StreetSmart, she's doing very well, very healthy! FYI I've been plant-based since 1982!

Having a young child diagnosed with type 1, it's quite an experience! Having a lot of support and good guidance initially is really critical, and unfortunately you leave the hospital with very little practical guidance. Even a good endocrinologist may not be enough to guide you through the wild ride that type 1 is. If you know anybody recently diagnosed especially someone with children feel free to share my information, my wife and I are always open to share what we've learned with others. Not that I want to turn this into a type 1 thread, one of the best books you can give to somebody with type 1 diabetes is called sugar surfing.

Keith
tbg

@Keith
I know a closing attorney who told me he has type 1 diabetes. I mentioned to him that I like Ezekiel bread which has no flour and he was very appreciative of my recommendation. But I am not certain if in fact this bread should be eaten by diabetics.
Doctors can only know so much about illness, it’s still a mystery. And while at the present moment there are heated discussions about science, the fact is that it can only do so much. In short it seems that it is impossible for life to understand itself.
I guess that’s why Andrew Weil appeals to me. After getting his medical degree, he went to South America to the rain forests and studied indigenous plants and healing traditions.
Did you ever consider looking into cannabis as a help with your daughter’s diabetes. Of course this is something that truly requires due diligence.
I also read something recently about Michael Pollan, and his new book that talks about psychedelic drugs and their medical use.
Okay this is not a type 1 thread so I will hopefully say no more.
https://www.drweil.com/health-wellness/body-mind-spirit/diabetes/diabetes-type-1/

This is not a type 1 thread, it is a gender-equity thread!
Okay, it is supposed to be neither, so hopefully I, too, will say no more after this:

@ali - When I said that ("I need a wife!") to my male colleagues, one of them retorted: "Me too!" His wife was a peer in another industry, and both I and those with stay-at-home nurturing spouses threw tomatoes at him because we envied the dual incomes that his household enjoyed.

All the different models of living have their costs and benefits. It's great that we live in a society where all the choices are increasingly accepted, but I don't think the natural tension between those who make different choices will ever go away because we are all forced to compete in the same marketplace.

@MCR
Thanks, I will check out that documentary.

Ali / MCR, it’s 2020: you can have a wife!

MCR,
Any chance we are close to 1994 again?
https://schiffgold.com/guest-commentaries/a-look-back-how-the-greenspan-fed-helped-blow-up-the-dot-com-bubble/

https://therealdeal.com/2020/10/22/billionaire-paul-singer-dumps-nyc-for-west-palm-beach/

No 30yrs not with their new Average Inflation Targetting framework.

@30yrs - I don't even pretend to have a clue, but your post just reminded me that I still have not read Michael Lewis' The New New Thing. A friend gave it to me when it first came out in 1999, and I did not read it because I was living it. Having a front row seat as the GC of a publicly traded tech company at the time, it was quite obvious that the whole thing was a house of cards. I chose to take my pay in cash rather than options.

@nada, unfortunately with Covid I can't! Mr. front_porch is pretty liberated, but balks at doing more than 50 percent of the housework (something about "I'm working too," or some such nonsense.) The typically solution is to outsource, but in these days I really don't want more people coming in and out of my apartment building than necessary.

Just marry MCR, then you’ll both have wives. Problem solved.

Seems like some suburban prices are below 2006 levels
https://therealdeal.com/tristate/2020/11/03/yankee-great-mariano-rivera-will-settle-for-loss-on-his-rye-mansion/

Ugh, that's a Certified Dank McMansion. People coming from the city (still) don't want three turrets (one is mercifully hidden), the giant lawyer foyer with double curved stairways, the massive rooms full of void space (double queen beds - is this a Best Western?), fake columns, inconsistent decoration, and general feeling of cheap excess. It's also squeezed onto a tiny lot with three exposures to the road. To me, the place is a tear-down, and a good reason why cities impose FAR limits.

https://www.zillow.com/homedetails/1-Brook-View-Ln-Rye-NY-10580/33038831_zpid/

Oooh. A Kate Wagner / McMansion Hell fan !

Indeed, it's a shame she doesn't publish so much anymore.

Funnily enough, a search of Rye reveals a dozen similar McMansions, all with a vulgar footballers' wives vibe. Why do the people of Greenwich have such better taste?

It's the Coney Island of Westchester (didn't you see Big), what do you expect?

For a little more you could buy a private island at Premium Point.

WSJ says that $500K plus homes are still selling like hotcakes.

https://www.wsj.com/articles/pandemic-boosts-upper-end-of-housing-market-coast-to-coast-11605106801

I saw a property recently that was listed at +35% over the Zestimate (which seemed reasonable) and went into contract the same day it was listed. Broker confirmed to me that it's not a mistake in the MLS.

I saw an interview with Jonathan Miller today where he talked about a record number of leases in Manhattan during October and the rush to the suburbs being over (or largely diminished).

But it's interesting that unlike most of what we talk about here the "upper end of the market" is anything over $500k.

My childhood home in the Chicago suburbs was on the market for a day and went for 20% over the "Zestimate" a few weeks ago. It would make a perfect set for anybody wanting to shoot a film or television show set in the late 1980s.

I'm gonna have to disagree with the esteemed Mr Miller. Rush to the suburbs is not over. There just isn't any inventory left. In some places, there is literally nothing in single family below some ridiculous price. If there's nothing to buy, there will be no rush. Doesn't mean the demand is gone.

Same. No one I know at banks/funds expects to be back at work before Spring or Summer.
Some already have explicit orders that they aren't returning til Summer at soonest.
My firm just offered a WFH office equipment stipend to buy anything we're missing.
My wife's boss is building out a new home office in her summer house.

Schools in my suburban hometown shutdown for rest of year due to staff shortages after 20% were out sick/quarantined/etc.
NYC schools set to close any day now.

Where's the driver for return to city here?
If wave 2 is anything close to wave 1, it could drive a whole new set of people who stayed to decide they've had enough fun.

I also think we have a significant amount of both residential and retail tenants who have been hanging on only because of eviction moratoria. What happens when those are over if there isn't some very large tenant relief passed?

Richard Florida is saying that cities will be reinvented as 15 minute bubbles, meaning areas where life can be conducted all within 15 minutes' travel.

The upshot: "Perhaps the biggest change—and the one that looks most like a fundamental disruption—is in store for the central business districts of great cities, which pack and stack office workers in canyons of giant office towers. The pandemic has turned them into virtual dead zones. While many office workers will return once vaccines are widely available, the shift to remote work means a significant number will not. This will be wrenching for the restaurants and shops that depended on their foot traffic, and for city budgets, which stand to lose billions of dollars in tax revenue."

https://www.wsj.com/articles/will-coronavirus-be-the-death-of-cities-not-so-fast-11607612400

I wonder how much schools have to do with the suburbanization trend. We've seen some proud schools go off the rails lately, including Collegiate, St Bernard's, and now Dalton all embracing the kookiest progressive social justice baloney. The danger is that you can be at a school that you think is level-headed, and then suddenly a fringe group somehow gets enough power that the school is embroiled in the latest political controversies rather than educating its students on reading and writing. Scary times in NYC.

https://nypost.com/2020/12/19/faculty-at-nycs-dalton-school-issues-8-page-anti-racism-manifesto/

Or, those schools could lose their biggest donors and the brightest future talent if they continue to ignore reality. These schools know what they are doing; IMHO, Collegiate is making an excellent decision forgoing Megyn Kelly’s children for the money and talent they will attract with their progressive curriculum.

And don’t get me started on Dalton. Bill Barr’s father and Jeffrey Epstein are two legacies they’d like to forget.

These schools are teaching their students to read and write quite well (and do math too!), but you go ahead and send your kids to school in Nowhere and I am sure they will be fine too. I recently had the pleasure of watching some excellent high school debate (albeit on Zoom). I love listening to the young debaters size up their competition. One of the funniest comments I heard was a team sighing relief as they noted their next match was against “two white guys.” It was hilarious to hear how the tables have turned. With that said, the duo from Regis was quite impressive. They lost, but it was close.

These loony "progressive" curricula are in fact just as intolerant of diversity as those of the far right. Diversity of thought and political belief is not welcome, and hence we have even more sorting along political lines between cities and everywhere else than before. Perhaps this is a reason no bailout of cities is forthcoming from the Senate.

I find it odd that we have to kooks taking over schools, yet your building and many others are run as of it's still the antebellum years. Why don't the self-styled reformers start at home, literally?

George, it is interesting you say that about my building. We have a few die hard Fox fans who are begging their fellow shareholders for charity. They cannot afford the things they want, have leveraged themselves to the hilt and are now leveraging the corporation’s main asset to the hilt. They can’t afford maintenance increases or assessments, so they want the staff to do the same and more work with fewer bodies. They lament the welfare state, yet they coddle failure to launch millenials related to them and their friends. And then there are those who are still taking money from their own parents, yet profess to be “self-made.” I could not agree more regarding wishing my building would start at home.

And my favorite refrain from reactionaries is how intolerant progressives are of them. Hurts, doesn’t it? I suggest these folks form a Galt’s Gulch in Nowhere, USA and see how that goes for them. To that crew I say “Run along now; be on your way already. We’ll be here stronger than ever when you come back . . . or don’t.”

What has become clear to me about my building is that it has quite a few pretenders in it; my favorites are those who cling to the high equity down payment and the need to remain a “BHS building” without giving a thought to post-closing reserves or the bigger picture. They just want to finish out their days without their friends knowing that their building is not what it once was. Again, we have quite the mix. I can deal with it all because I come from the culture, but I don’t pretend my building is something that it is not.

What is a BHS building?

I am sure there is a long line of applicants to Dalton, and if some parents take their kid out, there will be those willing to take the spot.

Some of the proposed measures seem more appropriate than others, reads like a brainstorming document. Important data missing from the article is the race-based performance gap or admission gap for the school. Maybe the proposed measures are justified if the current situation is really dire?

Remember this at the Little red schoolhouse;
https://nypost.com/2018/06/30/posh-schools-plan-to-segregate-students-by-race-draws-parents-ire/

I'm really happy my two oldest kids went(mostly) to public school (ps 3, is 89, LaGuardia). My son did four years of private high school, basically a playground for the privileged. A bunch of rich kids stealing their parents drugs and a tremendous amount of clickyness.

The brainstorming document uncovered by the Post has some nice ideas in it, but I am skeptical there can ever be such a thing as an antiracist $55K private school. In all likelihood, the best thing those activist teachers & students could do to improve Black education is to make good on their threats to quit, bringing that zeal to neighborhood schools that actually need it.

> And my favorite refrain from reactionaries is how intolerant progressives are of them.

Always interesting to see different sides perceive the same action. Reminds me of the old saw about asking for a date: men worry whether they'll be made fun of, women worry whether they'll be strangled.

After a hiatus, the news stories are back regarding businesses and people fleeing to sunnier shores.

https://www.wsj.com/articles/low-taxes-and-high-temperatures-lure-finance-firms-to-miami-11609851600

Virtu says they're heading to Florida (more like they're diversifying, as they've got a number of offices scattered around), meanwhile BlackRock says they're definitely still planning on moving into their Hudson Yards palace in 2022/23 (per Bloomberg this morning). But Blackrock may have to say that, as they got some sweet subsidies a few years ago to commit to the area. (Discuss amongst yourselves why they needed those subsidies, and whether subsidies will make a reappearance as the state or city try to encourage businesses to stay.)

Another thought - NYC has released their vaccination schedule by priority tier and we are looking at “beginning of summer” for the bulk of the 9-5 Manhattan office worker cohort to BEGIN.
Caveat that with.. we are not hitting any of our targets on vaccination deployment as it is.
We are on our 4th week of vaccinations and NYC is doing under 9K vax/day weekdays, half that on weekends, zero on holidays.
So we are on pace to take ~6 years to get through 2 jabs for 8M people. It’s a complete joke.

So we could be looking at 2021 office utilization looking very much like 2020 if not worse.

How many businesses won’t re-asses their office footprint after 2 years of 100% remote and force everyone back as if nothing fundamentally has shifted?

More stories about the unsustainable situation with NY...

https://www.wsj.com/articles/new-york-i-love-you-but-we-cant-go-on-like-this-11610732183

"New York’s biggest existential issue is the dire financial condition of city and state government. Total state spending is $177 billion a year—almost twice the budget of Florida, which has a population that is 10% larger than New York’s. New York City alone spends as much as Florida’s state government does. In the past 18 years, New York City’s population has grown less than 4%, while its public payroll is up 20%. For the six years ending 2019, according to a Manhattan Institute report by Eric Kober, the city’s average public-employee wages rose 48%, almost three times the national average. These trends are worth keeping in mind during the discussion of how to fill Covid-related budget holes."

And this...

http://avenuemagazine.com/young-new-yorkers-moving-to-palm-beach/

“I love it down here. All of my friends are young and stylish. It has all the energy that’s missing in New York.”

Her neighbor, Felicia Taylor, another recent émigré, says she won’t leave either. A longtime television journalist (and daughter of actor Rod Taylor), she put her Park Avenue condo on the market and moved south in February.

“I have quite a few friends who have come down here and bought apartments sight unseen,” says Ms. Taylor. Speaking to Avenue from her terrace — “the first time in my life I have a terrace!” — she wondered why anyone would stay in New York. “With online platforms and technology there’s no need,” she said. “I just finished a documentary: the director was in Lebanon, the editor was in Brooklyn, and I’m here. It worked wonderfully.”

Those people driving up digs market pulse are not listening.

I'm happy for them (some of my relatives included). As the ranks of the noveau riche continue to swell, there is room for multiple clusters of swank to thrive in parallel. Maybe when this is all over I'll finally be able to get a reservation at Carbone.

I wonder how many of those fabulous former New Yorkers have spent a summer in South Florida?