Urbandigs: Market continues to improve - Feb 21

Did I mention that resales market pulse at 52 now?

Thanks all for the various responses to my question re "why not buy RE with stock market gains?" It all goes back to the way I view the consumption aspect of real estate (like buying that new pair of shoes I might have had my eyes on!). I feel like the stock market gains I am seeing in my account are not real to the extent that I think they are going to evaporate, but if I use them to buy that overpriced pair of shoes I've had my eyes on, then I will then get the shoes to wear and enjoy without having spent any "real" money. I know this type of thinking drives finance types nuts, but I can't help it.

On the topic of selling stocks to buy RE, I think this is happening. But it is happening outside of the urban core in areas including Westchester, Fairfield County and the Hamptons. Separately, it is also happening in cities seeing net inflow of residents, primarily in the south. So I think the trend you are expecting is happening, but the high stock market prices and low interest rates are just offsetting the impact of the outflow of residents NYC has faced in the past 12 months.

I know a law firm partner who last year lamented that his apartment was only 1200 sq ft for his family of four and if he knew he was going to have had a big year he would have bought a bigger apartment. This year he has another good year and instead of upgrading the city apartment he bought a 'weekend house' an hour away on the metro north. Any other year and he would be flipping up to a $4-5 million apartment.

Don't pop my bubble MCR... I'm certainly viewing my recent stock gains as real money! Just staying focused on the end game.

I get the shoe analogy, but I don't view real estate as 100% consumption, maybe 50%?? Theres zero financial return for your shoes, 100% emotional/utilization. However as you suggest, a home is a financial and an emotional decision. Many people, especially those with children seem to prefer home ownership. Others just prefer owning the place that they live in with or without children. Potential financial / tax benefits along with utilization as well.

I wonder how the math works out on owning that second home versus doing an Airbnb? I get some prefer the ownership aspect,convenience of just having all your stuff there. However a second home just sits empty for such a large percentage of the time for most people. This is where I would rather plow that extra money into my kids college fund and my own retirement investments via stocks versus upkeep / mortgage on a second home.

I would personally rather invest in upgrading my primary residence where I spend most of my time. But that's just me, everybody has to do what's best for their own situation.

Keith
TBG

>> Nada, For me, if the space is adequate and I like it, I wouldn’t move even if I had more money to spend. Of course if my networth became 10x since buying, I may think differently.

Having parlayed the money that would have been a down payment 10 years ago into something that covers rent for a place that costs 10x as much, no mortgage / interest / cc / tax, I guess I think differently.

MCR, I don’t disagree with the viewpoint of “If stocks have gone up to an overpriced place, why don’t I sell and use it for consumption.” I just disagree with buying shoes when they are giving them away for free.

@nada at what point do we view stocks as being 'overpriced' and we should sell? I know a little bit about you and your level of expertise and intelligence. But correct me if I'm wrong, didn't you think stocks were overpriced one year ago?

@woodsidepaul, give him my number. I'm happy to help him through his NYC real estate needs when he's ready.

ali r.
{upstairs realty}

Nada, Where are going to find a place if you net worth is another 5x in next 5 years?

On the main topic of this thread, I am wondering why we have not seen more supply. Thoughts any one?

High number of listings in contract can be partly explained by a lack of market activity during April/July last year. Perhaps it will take another month for more listings - March/April time frame. So the end of March will be real test of Market Pulse strength.

300, I would guess people are in a wait-and-see mode. Wait to see if they are staying in NYC or not, upgrading or not, is the market reverting or not, etc.

>> But correct me if I'm wrong, didn't you think stocks were overpriced one year ago?

Yep, shows how much I know. Stocks returned ~15% in 2020. Just makes me think they are even more overpriced, by my valuation metrics. Doesn’t mean you should, and most of the professional advice out there seems to be that investors should not attempt long-term investing based on value: just go long no matter what.

There is also the issue of “If I sell, where do I put it?” I don’t have an answer to that for you either. I do for me, but not you.

So roughly, I am useless.

On stock market, standard and simple advice from financial advisors to any one who feels the market level is very high is to keep a bigger percentage of portfolio in cash till they sleep better.

>> Nada, Where are going to find a place if you net worth is another 5x in next 5 years?

More a question of what the hell I’d do with such a place. I’m having enough trouble digesting the current place.

That said, if Kenny G decides he needs responsible house sitters for his $238M 23,000 sq ft apt who’d be willing to cover the $100K monthlies in cc+taxes, it’d be an injustice to leave him hanging, wouldn’t it?

Maybe we just cut it up in 10 shares at $10K/mo, a big share apt for SE denizens. We could all justify the cost by time saved alone. No more slow pecking away on the phones, we’d just efficiently hash out every day’s RE gossip over dinner each night.

Re supply, my newly ex-landlord was ready to be done landlording, until he saw what the expiring J51 and oversupply had done to recent comps. So he did not move forward with listing; apparently would rather rent it out at 1.5% cap rate indefinitely. Not sure if that's optimism or loss aversion, but either way there's your data point.

It was 20 Pine, right?

Funny, Nada...

Yes, 20 Pine

Regarding the low number of listings coming back on recently there are two factors, I think:

1. A lot of COVID panic sellers who didn't find buyers are calming down now that there is vaccine being distributed. There is now a line of sight to a 2019 lifestyle returning this summer-ish. These sellers are reconsidering holding out to stay here and not relisting. It will be interesting to see if there is a COVID reverse: once we are all well vaccinated and restaurants and schools are open, do some of the sellers start looking to come back.

2. Days on market kills real estate listings. The weather the past two weekends of snowstorms and near freezing weather may have led some to not list. Why have days on market and an unattended open house if you can delay? I am in contract to sell, but had I not been able to get into contract before the holiday break, I certainly would have delayed my listing until this coming week. We are coming into March and it will be rainy and ~50 degrees instead of snowing and 34 degrees.

Thanks. Your first reason is very interesting. If that is indeed the case, the strength is real.

One of the reasons people might come back is how crazy markets are outside NYC. Here's an example of what buyers who didn't act quickly when leaving NYC are now confronting:

https://www.zillow.com/homedetails/236-Pendleton-Ave-Palm-Beach-FL-33480/46844576_zpid/

Sold in Nov 2019 for $2.3M, now listed $6.4M. Definitely not renovated in the meantime.

https://www.bloomberg.com/news/articles/2021-02-19/january-home-prices-in-new-york-city-had-record-declines

Old news with October/Nov pre-vaccine contracts. Not sure people can get those prices now.

I'm certainly not an expert on that sub market of Palm Beach County. But the home you posted will never sell at that ask, almost 2k a square foot. The market is certainly hot down here, but it hasn't more than doubled for a mediocre home.

multi I'm with you. Keep some stock but enjoy your new shoes. It's like I occasionally will run into a guy (never a gal, oddly) that likes to brag about their $ but has horrible teeth. I used to wonder about that silently but now I call them on it. One of the fun things of getting old is you can say that kind of thing.

https://www.wsj.com/articles/wall-street-moves-to-florida-nyc-real-estate-11614020268?campaign_id=4&emc=edit_dk_20210223&instance_id=27394&nl=dealbook&regi_id=69395791&segment_id=52169&te=1&user_id=0ee78fbe7414c12d83966706ca1eb7f3

Some riches are leaving, as long as the price is stable, it means some other riches are coming.

Surely this trend will only apply to the extremely wealthy... ?

https://www.wsj.com/articles/wall-street-moves-to-florida-nyc-real-estate-11614020268?campaign_id=4&emc=edit_dk_20210223&instance_id=27394&nl=dealbook&regi_id=69395791&segment_id=52169&te=1&user_id=0ee78fbe7414c12d83966706ca1eb7f3

UBS moved to CT and eventually moved mostly back to NYC. While the move to Florida by some finance players is real, the net impact remains to be seen. Some of these people will try to find top ranked private schools in Miami and will find the options slim.

https://www.niche.com/k12/search/best-private-k12-schools/

Florida's beautiful for about 6 months out of the year. However, the extreme heat and humidity of the other 6 months is an acquired taste.

If they move to Jupiter / North Palm Beach area... You have the Pine School (Jupiter/Hobe), Benjamin(NPB) and St. Marks (PBG).

These are also much more livable places than Palm Beach, especially if you have children. But I still think the shock of moving to Florida from New York City might be a bit too much for most... Unless of course you are absolutely over urban life.

Masters of the universe want National rankings.

I’m disappointed by Icahn’s pad from yourname’s link:

https://streeteasy.com/building/museum-tower/penthouse

I would not want to play responsible house-sitter there for $70K/mo in cc+taxes.

That mirrored bedroom ceiling surcharge on the property taxes is a killer.

You asked me NADA if I dealt with many investors, I don't. I've joked I'd love to get my hands on some of that foreign money pouring into these new development condos, but that hasn't happened. Why wouldn't somebody want a rebate that was paying 15 or 30 million for an investment property?

So Friday we bid on a property in what was once a uber expensive, branded 'it' building. The owner paid $1.65, we have an accepted offer at $1.02..

This particular owner happens to own a few other units in the building, along with what sounded like three or four units in other previously new development buildings... Taking an absolute bath on all of them. I got to speaking with the broker, this is an extremely wealthy overseas buyer, all the units were bought with cash and then rented out... I stopped asking questions there. In this particular case the owner is not from a country where one would typically be nervous about keeping too much cash there. So go figure? Am I missing something? Scratching my head why such a sophisticated, wealthy business titan would be making these types of 'investments'?

The broker handling the resales was the broker that got him into these units initially, and specializes in these types of transactions to foreign buyers.

theburkhardtgroup, I guess that must be a Russian or a Chinese broker

Congrats on the accepted offer Keith! A third of normal commissions on a heavily discounted $15-30M apt is still a lot of lolly, so you’re buying the first round post-pandemic.

I figure it’s some combination of a belief in momentum (it’s gone up in the past so it’ll continue doing so) and diversification (any diversification is good, and any attempt at assessing value is folly as the efficient market has fully priced in the “right” value).

But you can gently inquire for more from the resale broker, I suppose.

In any case, please pass regards from both your client and me to the owner for allowing these apts to get built. We, the developers, and the workers all appreciate the subsidies.

And just to clarify what I meant by Uber expensive, price per square foot relative to the neighborhood. This was for an approximately 600 square foot one bedroom...

I am regularly surprised at the number of momentum investors who pile into a trade just because the trend is your friend. Many of them make tons of money just by being able to spot a trend and ride it. It made a lot of people in Manhattan real estate rich, like our erstwhile president. But some people get stuck holding the bag.

I am not aware that our erstwhile President is rich.
In the early nineties Forbes Magazine reported his net worth went negative.
By 1987 he was a Russian Asset, I wonder why.

As far as moving to Florida, no way I want to live in a state that flies the flag at mast for Rush Limbaugh.
All those alienated people.
Florida is very susceptible to the Texas like incident that just happened thanks to cronyism, deregulation that benefits rich corporations and disregard for the people, and of course no respect for climate change that is causing these unusual events.

https://www.crainsnewyork.com/technology/queens-chamber-has-plan-make-borough-tech-hub-amazons-help?utm_source=trending-now-&utm_medium=email&utm_campaign=20210223&utm_content=hero-headline

"The owner paid $1.65, we have an accepted offer at $1.02."

That sure is some "improvement."

Btw, why $1.02m? Why not $999,999? Buyer just wanted to donate mansion tax to the govt?

I guess a rising tide doesn't lift all boats...

Current Ask: 1.295
Rebate :$18,360

Accepted: $1.020 +$20k credit (approved by lender)

Buyer now moving in a different direction. C'est la vie

"Though deal volume is up, prices are still trending downward, with the average discount from the properties’ original asking price coming in at 16 percent."
https://therealdeal.com/2021/02/22/manhattan-luxury-market-sees-another-strong-week-with-36-deals/

George, you still have to pay mansion tax for 999,999. The city factors in closing cost for this calculation.

As an FYI, the building I'm referencing above was essentially trying to sell top of a line BMWs. What's the most depreciated car in the United States? 750i. The original owner purchased from a sales gallery...

I think buyers have become smarter over the last 15 years. And I've also realized there are some buyers who purchase homes like they're buying a high-end luxury car, they know they're going to get killed. They just don't care. Or maybe as some have suggested here, they're just not as smart as I give them credit for being.

Keith

That analogy it some pretty intense bullshit.

It's simply an analogy based on my experience/observation. However one can think whatever they like. However considering you're dealing with limited information, since you don't know which building I'm referencing, I'm not sure why you think it's b*******?

One thing I've observed with your comments regarding some of my posts 30, I believe you have a very old school traditional view on real estate sales.

I don't offer sweeping opinions on market direction. I created a model for consumers based on 100% transparency, and I share a large portion of my commission with my clients. Similar to the way that pricing for travel, stock trading decreased exponentially due to technology and available information to the public. I've similarly reduced the transaction cost for my clients. Works well for me, works well for my clients.

We don't consider ourselves traditional salespeople, we're actually never trying to sell any property. Clients bring properties they're interested in purchasing to us, and we offer them an opinion and analysis on the property based on our experience and available data. And other than my participation on this forum for the last 10-plus years, we do no advertising.

There are a number of people currently in these forums that have worked with us, and have been very happy with the results.

So no worries, if you think my opinion is b*******.

Keith
TBG

People get so emotional when it come to housing...

I don't know if Keith & 30Yrs' loving argument falls under that category.

Re Mansion tax for $999,999 conveyances: the transfer tax is NOT part of the consideration calculation. However, apparently a transfer of a coop at $999,999 can be taxable if there is an underlying mortgage. Presumably that's what happened here.

"consideration includes a proportionate share of the unpaid principal of any mortgages on the real property of the cooperative housing corporation comprising the cooperative dwelling or dwellings."

https://www.tax.ny.gov/pdf/current_forms/property/tp584nyci.pdf

Just listened to Digs weekly video. Noah is claiming the sales are off the chart strong - in my view it is to be expected as a catch up to lost activity last year. However, if it continues for another 6-8 weeks, I do not see how the resale prices do not start to go up in a very obvious manner. SE condo index may start to reflect the increases too when April closing (Jan contract signing) data gets published.

300, how bullish are you compared to pre-pandemic levels? Is it that you think we are going back there, or that we will exceed it? It seems to me compared to then:

+ interest rates are lower, but much of that has gone away compared to 6 months ago

In the could help, could hurt category:

? Stocks are higher making people more flush. But then again they could see it as evidence of how great it is to keep money in the stock market.

On the other side of the ledger, headwinds are:

- rents are lower, making value even more questionable than it used to be
- demand for living in NYC is lower
- would-be local buyers (e.g., George, WoodsidePaul’s law partner) blew their wads in Nowhere
- new development inventory continues to pile up
- the momentum investor coffin (“NY RE always goes up”) got its final nail and has been replaced by “no one will ever want/need to be in NYC ever again” fever

To me, that all does not bode well for NYC RE prices compared to before.

On the positives:
1. People are looking for more space due to possibility of working from home say 1-2 days a week (essentially higher $ allocation to housing) 2. Empty nesters from burbs, who couldn’t previously sell their home, moving into the city after getting a great price for their suburban home.
3. New developments start has virtually come to a standstill in Manhattan in the last two years and a big percentage of new development in Manhattan is ultra luxury and doesn’t offer competition to resales. High $ per sq ft (call it $2000 plus per sq ft) and high price tag (call it 6mm plus) Resales will remain under pressure due to competitor from new developments.
And the trend of younger people wanting to live in the cities will restart in a couple of months.
4. Lot of money being made by company founders going public and sponsors of SPAC IPO. Many of them want to own a place in NYC.

Forgot to mention what Keith say. Most of his customers want to buy not rent and have plenty of money left to invest elsewhere. Granted his buyers are mostly in under $3mm resales which is where rental yields over long-term are higher than say a $10mm apartment.

For context, using DIGS data.

Manhattan Resales price per sq ft $1145 market pulse 53. New development $1887, market pulse 48 (real may be 20 as not all inventory is listed) and new developments tend to be in a lesser location than location of resales as that is where the land is available. So if the new development prices come down another 20%, they will provide a competition to resales despite much higher RE taxes on new development per sq ft.

https://www.nytimes.com/2020/10/13/nyregion/big-tech-nyc-office-space.html

300, so where do you think it all ends up price-wise.

On your positives:

1. We saw 5-day WFH increase demand in the suburbs and decrease demand in Manhattan. Why should we think 1-2 day WFH increases net Manhattan demand more to a number more than 0-day WFH? 2020 tells us people go to the burbs.

2. This is circular logic. Pre-pandemic, burb prices were low and NYC prices were high. Pandemic increased burb prices and decreased NYC prices. This in turn is going to increase NYC prices to above prior levels because of newly-minted money in the burbs? Those who sold their house in the burbs at high prices, are they living in the street currently!

3. 10K new dev inventory as of last year. I bet it grew over the past year. It is a pipe dream to think pressure there does not pressure the rest of the market. Again, what’s the difference between now & 2019?

4. Weren’t people making money in 2019?

>> Forgot to mention what Keith say. Most of his customers want to buy not rent and have plenty of money left to invest elsewhere.

Isn’t that a self-fulfilling prophecy? (Mainly) buyers broker has customers who want to buy, not rent. Were these people not around in 2019, with their loads of money to buy and invest elsewhere at the same time?

Not to hijack (but I guess to hijack) Nada, #1 is going to be very very dependent on what the public school situation looks like for the Fall; as it stands there is a possibility that we won't be offered five days a week in-building in September. If that's the case, then the 'burbs start calling in a way that they don't if school is back.

I personally think this factor is too early to call, and we'll know a lot more June/Julyish, but probably not before then.

ali r.

Nada,

We have 6-8% lower prices than 2019.

1. It is all relative to last year. Exodus from Manhattan peaked last year and my opinion is now we will see net inflow and upgrades (due to partial WFH) as office open in person.

2. Where do you think the suburban home sellers go? There were people who wanted to move to the city from the burbs as they couldn't sell their suburban home. Basically, people from NYC buying suburban homes and some of the those sellers are clearly moving to NYC after spending time perhaps in their vacation home in FL.

3. Not a pipe dream but we can agree to disagree. Upper-east side 2/3 bedrooms resale condo buyer under $3mm was never to looking to buy that fancy new condo in Hudson Yards or West Chelsea at $5mm with poor schools. I am not even talking about 1 Manhattan Square,

4. Far more money is being made in tech type IPOs and SPACS than 2019.

Question: Do you see June 2021 SE Condo Index higher than that of Jan 2021? I see higher.

"Isn’t that a self-fulfilling prophecy? (Mainly) buyers broker has customers who want to buy, not rent."

Shall we consider what you say self-fulfilling prophecy as you will never buy as $10mm plus price point condos have been cheaper for rent for a long time and likely to remain so due to unsold ultra luxury new developments and you may be generalizing your view based on your market segment to other market segments?

The best areas of the market have been sub-$3m, where real people buy, and real people take mortgages. Hence why this is such a bearish sign:

http://www.mortgagenewsdaily.com/consumer_rates/968604.aspx

There is a somewhat delayed reaction from the 10 year rising (it was above 1.5 this week after bottoming at 0.5) to mortgage rates rising to cooling housing demand. So while there are tailwinds from high equity prices, high interest rates both depress the tech stocks that have made millennials rich and make housing less affordable. The extraordinary blowout of $1.9 trillion of spending Could further inflate the dollar and force rates higher still
Could be a formidable headwind.

I got no horse in this race, 300: just a SE barfly with little info on the “real” market.

I was more thinking about outlook vs pre-pandemic levels, but I’ll take the other side of your call on a higher June 2021 vs Jan 2021 SE index. That’s a tougher call. Loser buys summer cocktails, let’s say?

Reasons:

1) I think the bump you are contemplating goes into contract in the spring, not in the fall. So let’s say Apr-May. Mortgage rate headwinds pointed out by me and George notwithstanding.

2) Add 1-2 months for contract to sale time.

3) Add 1.5 months due to SE index’s 3-month averaging (IIRC).

So if we’re talking about a bottoming (without discussing what happens after), I think if it happens your call is a few months early. Hence, I’ll take the other side on June 2021 SE Index vs Jan 2021 SE Index.

To FP’s point, parents don’t have full clarity yet on school situation in the fall. They can probably guess, but people hesitate to make decisions when faced with uncertainty. That delays decisions, IMO, keeping demand suppressed for a few months still.

Agreed. At nice place. Hopefully most of us will be vaccinated by July.
“I’ll take the other side of your call on a higher June 2021 vs Jan 2021 SE index. That’s a tougher call. Loser buys summer cocktails, let’s say?”

@George - temporary spike. For many reasons the Fed cannot allow treasury yields to rise considerably higher than they are now. Look for potentially more asset purchases to be announced at the March 17 Fed meeting, and if not later in the spring. In any timeline, they simply cannot allow rates to significantly rise to a point that would crash housing prices, and this is obvious when you examine current debt/GDP levels relative to historicals in context of bond convexity at absolute low yields that we’re currently seeing. This Thursday was proof that the rising yields in response to the absurd levels of fiscal spending are a threat to equity markets, and the Fed Put prints every time this happens, even in less tumultuous markets. Don’t expect anything different this time around - rates will be lower end of year due to Fed action. The inflation implications will also be severe, which again makes prime real estate a good asset.

Re: clarity on “full normal” school opening for 2021-2022 school year by mid-summer
I suspect the resignation of nyc schools chancellor mid-pandemic is not going to do a lot to improve planning.

At the end of the day it’s going to come down to what kind of case the teachers unions can argue vs the % of people vaccinated & number of parents who are “back to normal” in-office at work.

Though I think NYC offices opening & NYC schools opening is a little bit of a chicken&egg problem so going to be interesting to see this play out. I would agree that we really won’t have much of a clue till July.

UWS_ER, I tend to agree with you on Fed support especially when Powell said that QE will continue at least at the current pace but remain cautious due to increasing deficits. Without being in the flow of information at the trading desks, Fed is probably happy to see 10y rise to 1.5% level but not sure how much tolerance they have beyond that. Increase of 10y rates to more than 1.5% does remain a risk to real estate market.

Failure of schools to reopen fully in Sept would be an epic fail, as if the current state of public schools in progressive cities isn't already an epic fail. Barring a new vaccine-resistant strain, there is no reason not to reopen fully. This should favor NY real estate. On the counter side, try getting a summer house in any nice resort area. The inventory is close to nil. The longer the disruption lasts, the more permanet is the behavioral change it caused.

As for interest rates, this time may be different. Inflation in the next few months will almost certainly be higher than usual, and the near consensus on the Street is that yields will rise further.

300>> Agreed. At nice place.

At this point, I’ll take brown paper bags on a stoop.

I think increase of 10y yields north of 2% poses more risk, but 1.5% isn’t that big of a deal considering its theoretical relation to higher growth. The Fed won’t allow 10y yields anywhere near 2% though, and the way they do that is even more printing which is just what drove the national housing market 10% higher in 2020. The idea that their next move is tapering is frankly laughable. I’m on a Wall Street rates desk and nobody sees this as the path - they just cannot allow conditions to tighten and Biden’s administration will spend more than enough to force them to do more QE. Should be positive for NYC prices if it comes in conjunction with a return to normalcy and some office work.

Fed can stick to its guns and keep driving rates down regardless, but if the market perceives that the Fed is behind the curve and might lose control, the price will be high for equities and the bond markets. Fed may enjoying watching assets deflate, but at some level, sharp moves in the bond and equity markets is not something Powell can or should ignore. No doubt one should not fight the fed, but the fed also should not get into a protracted battle with the markets, that would be a bad mistake. So far so good, all fed gauges read a slow go, but some gauges outside of Powell's focus , level of stim spending, lumber prices are flashing red. I think Fed projections are too pessimistic. Economists/Fed are at times as good as weatherman, short term, pretty good, long term, that is where the problems occur.

In fairness to Carranza, the man was an absolute superhero to get us all even the amount of school that he did. Just about everyone on this board is used to dealing with millions of dollars, and that makes us think we're smart. However, it's infinitely more complex to deal with millions of people.

And to address the point about our teachers, @steve, I don't think it's "the teachers unions" who would stand in the way of a full fall re-opening; it's parents. This is to @george's comment too -- if there is a significant percentage (whatever "significant" is) of public school parents who demand a remote option in Fall 2021, then THAT would be the reason we can't reopen fully.

DOE can't run two school systems, remote and in-building, in parallel -- they don't have the staff to do it. (Which comes down to money, but I don't see the societal will to throw MORE money into school systems that many think is "already an epic fail.")

ali r.

PS I want to crash these summer cocktails, wherever and whenever they are...

Ali, You are most welcome to join for cocktails. Hopefully end of July.

@ali - I’d agree parents are definetely a huge factor, but we can’t discount the teachers union.
My memory of summer 2020 was dueling press releases from BdB announcing schools were going to safely open & teachers union reps saying “oh hell no”, tit-for-tat all the way through to September.

The solution would be for NYC to allocated vax to DOE and use the schools as a vax site for teachers&staff. Teachers need to be prioritized and this is the easiest way to do that. Simultaneously this removes the teachers union safety very valid argument, and hopefully re-assures teachers.

This is not rocket science, the hospital systems and elite universities managed to do this already.
Currently the easiest way to get a vax is to be in any way associated with above. I know of many non-patient facing employees at hospital systems who have already had both shots.
Further I know a remote instructor at an out-of-state Ivy who has a vax with their name on it if they want to drive over. There was the NYT articles about colleges not being able to differentiate between their remote&in-person staff per their legal counsel.

Currently NYC public school teachers need to compete with SoulCycle instructors and everyone else with vague ailments now allowed to get shots at the general vax sites.. all basically on the honor system since no one is checking documents.

JNJ is approved and after 1 months of sorting out production and actually administration current daily jab rate will go to 2mm+. Perhaps 2.5mm per day by the end of April. So all the teachers in NYC certainly would have gotten shots by then if they wanted to.

FP, you have to make a call for fun on SE Index Jan 2021 vs June 2021 to join.

RE: SPACs

I didn’t know why we were talking about them. Now I understand, this is will drive NYC RE to the moon (in the sub-$3M market?):

https://www.nytimes.com/2021/02/27/style/SPACS-celebrity-craze.html

The yield on the 10 year note closed at 1.40% late on Friday.

Monthly jobs report this Friday.

nada, fair enough. It looks like SE has multiple indices so tell me which one we're using (link if you can).

Tx
ali

Ali, There is only one SE Condo Price Index for Manhattan.

https://streeteasy.com/blog/data-dashboard/
You need to go to download data at the bottom.

From article Inonada posted, I still view SPACS as “scam-prone backwater of the finance world.” Who is actually buying these things?! I could understand buying one of Chamath’s, but the ones like whatever that one was that just bought Rover? Who invested with those guys?

Here's a link to the urbandigs vlog from Friday. Some interesting new charts as well.
https://youtu.be/sYnrGmJ_12w

@nada I do have a bit of a captured audience, the people that contact me for the most part have a bias towards buying. They prefer home ownership I guess is what I was saying versus renting.

When I worked at traditional firms, I would occasionally get walk-ins/phone ups from ads the company placed. You would get a greater percentage of people who were calling on a sales ad that were weighing both purchasing and renting, no particular bias.

I get it, this is not a very profound realization and wasn't meant to be : )

I'll take the over on your wager, I think June 2021 will be slightly higher. We're just not seeing inventory rise the way we were all expecting. It's just hard to believe that everyone would be thinking the exact same way regarding timing for listing their property.

Keith Burkhardt
TBG

Excellent, welcome to the fray Keith! It’s 2 clueful people vs 1 clueless. Anybody care to join my clueless side? George?

FTR, I am counting on technical bits here to eek out a win on the wager:

- Contract to sale delay.
- Delay from sale to SE index.
- Expiration of old new dev tax abatement.

You guys tend to bucket new dev that sold in the last decade or so as new dev folly. Nevertheless, it shows up in the index upon resale with a drop of relative to the rest of the market because the tax credits have been used up. Lots of $1-3M new dev from the past decade out there, many with investors looking to exit.

Yes. Tax abatement expiration on 10-20y old condos is a real drag on the SE condo index. Hopefully from Jan-June, this factor is not material.

Nada, How much delay do you expect from Sale to SE index? Is is due to averaging to make the index moves smoother? 2 months?

So just to clarify, from the Sales Dashboard, "Download Data" > "Property Type" = "Sales" > "Home Type = Condo" gives us seven possible reports. We're using the "Median Sales Price" report, yes? So that gives us a csv file where row 110 is Manhattan, and column EF is a January value of $1,542,500? Is that the number we're betting on being lower/higher?

Just click on Price Index.

300, If I click on "Metric" to get "Price Index", then what I get can't be subsorted by Property Type. So it's everything -- townhouses, co-ops, condos all mixed together. So we're using that?

The index is only condos.

Last reading for Manhattan is 1020523

I believe StreetEasy gives users registered as agents/brokers very different options on their menus.

OK, so 300 and I figured this out: the index HAS been revised, so the one with the last reading for Manhattan of 1020523 now includes all property types, including co-ops.

So this whatever-it-is-index, in January, probably reflected Oct/Nov contract activity. In June, it should reflect (*counts on fingers*) March/April contract activity.

So assuming:

Bonus Drops between Index Reading 1 and Index Reading 2 cause a spate of buying activity as Bonus Babies feel their oats...

Interest-rate rise between Index Reading 1 and Index Reading 2 provide a headwind/damper on buying activity...

Index will be weighted towards co-ops as Index Reading 2 will still be too early in the year for increased international travel to flow through towards a stronger condo market....

Seasonally strong spring market due to better (I hope) weather...

Move over, Keith and 300 ... I'll sit with the bulls, though at a respectful 6-foot distance.

I hate to bet against Nada (because, among other reasons, if I'd listened to him in 2008 I'd probably be sitting in a much nicer apartment now)... but I too am going to go for up, though I think the bump up will be very very marginal.

Does that mean if I win I'm stuck with a tiny drink? I hope not.

ali r.

Ali, Thanks for pointing out that SE Price index has been revised not just to include condos but coops and townhouses as well. Apparently they did it a few years back but I never bothered to read the change note.

Nada, They are using ARIMA. So depending on what auto correlation factor they use, the turn is harder.