All Forum Posts by: John Collins

Originally posted by @Llewelyn A.:

@John Collins

I have 10 small multi-family properties in Brooklyn, approximately 25 apts. I had been given notice for 7 of them through out the pandemic. 6 of the I had re-rented with one left.

My rent roll is slightly HIGHER as people flee Manhattan. Some have come to Brooklyn. In fact, Brooklyn is a HOT market right now if I were to sell my apts.

I don't think this should be a surprise unless people were biased against NYC in general.

I'm doing quite well, especially since Interest rates have fallen and my rent rolls are approximately the same or slightly higher.

 Interesting. From what I hear , the biggest sector hit has been the luxury rental market which makes sense as these people have A LOT more options and immediately flee to suburbs or surrounding towns. 

No one?

It's important to note the common sense posted by @Lynnette E. has already had her branded as a KKK redneck who supports white supremacy by the city. It's the constant pandering of liberals instead of growing a pair and accepting straight talk that leads to this cycle. Those who keep popping out kids then complaining about the rent should be evicted - actions have consequences in nature and nature's laws should apply here. 

If we can get over politics and preach common sense, we might have a sense of pride as a nation again and not keep stepping on our own feet. 

The surge in empty apartments in the nation’s largest rental market is likely to have ripple effects throughout the economy. Housing experts estimate that about half of Manhattan’s apartment rentals are owned by small business owners, rather than large publicly traded companies or the big, well-funded real estate families. As the small landlords lose income, they may be unable to pay property taxes, which is New York City’s largest source of revenue. A drop in property taxes could result in cuts to services, which could make New York less attractive to new residents.

“This could be a difficult couple of years for landlords,” Miller said.

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NY landlords - what are your plans? 

https://www.cnbc.com/2020/08/13/empty-apartments-in-manhattan-reach-record-high-topping-13000.html

• The number of apartments for rent, or listing inventory, more than doubled over last year and set a record for the 14 years since data started being collected
• While hundreds of thousands of residents left the city in March and April in the beginning of the coronavirus pandemic, brokers and landlords hoped many would start returning in July and August.
• July’s weakness, and what brokers say is already a slow August, suggests that Manhattan’s real estate and economic troubles could extend well into the fall or beyond.

As I wrote about many times earlier, the migration from expensive city centers to more luxurious suburban / rural settings is solidifying. The experience is now virtual to meet, going on trips, instead of just staying in close proximity. SF/Silicon Valley are the only places insulated because of the tech bubble (which has been strengthened by pandemic). Also expecting strong biotech areas like Anaheim to see an uptick of rental activity. 

How are you guys on payments now that we're entering July?

https://www.cnbc.com/2020/07/08/32-percent-of-us-households-missed-their-july-housing-payments.html

As the economic fallout from the coronavirus pandemic continues, almost one-third of U.S. households, 32%, have not made their full housing payments for July yet, according to a survey by Apartment List, an online rental platform.

About 19% of Americans made no housing payment at all during the first week of the month, and 13% paid only a portion of their rent or mortgage.

Renters, low-income and younger households were most likely to miss their payments, Apartment List found.

Congrats on actually looking at the context of the statement. The covid effect will signal a cultural shift to commute into big cities for these affluent people when they need to (which won't be daily), not being in the thick of the action all the time.  You also have the rise of social media as a dominant cultural point that lets those connect online and then meet up. 

Low income housing won't change and will likely increase in the cities. 

 This is very specific to high end rentals, not the city itself. People will want all of those things while coming in from more spaced out suburban settings. You will see a drop in rental demand for upmarket properties and prices by the end of this year. We are still in the early faces -- look how inflated the market is , far out of touch with reality. 

Lafeyette qualifies as an upscale suburb, not city proper. The whole point is this is about the de-urbanization of America for those that can afford it - the priority being to go to these suburbs where you get more bang for buck, have a homey feel, don't have to be in the thick of things all the time.

Here's a great article by Andrew Left , a guy who made billions by predicting trends and exposing frauds ( @chris k. check this out)

https://citronresearch.com/wp-content/uploads/2020/05/RH-The-Clear-Winner-from-the-De-Urbanization-of-America.pdf



It seems every three hours CNBC is interviewing a realtor about this trend.
Instead of Citron editorializing, look at these headlines from NY, SF, Seattle,
London, Paris, and every over urban market over the past few weeks:
• “Zillow, Redfin predict a suburban boom in US real estate as remote work
becomes more common”
• “Wealthy New Yorkers flee Manhattan for Suburbs and Beyond”
• “New Yorkers Fleeing City Hunt for Million-Dollar Suburban Homes”
• “City Dweller looking to move to suburbs amid pandemic”
• “Young are joining the rich fleeing America’s big cites for the suburbs”
• “Remote work may trigger a suburban boom in real estate”
• “Investors are prioritizing greenery and open space, even if it means leaving the
historic city center”


The work at home and move to larger spaces trend is just beginning. But more
importantly, the people who will be working at home are younger and have more
disposable income. Consider these points:
• “Mark Zuckerberg plans to shift Facebook toward a substantially remote
workforce over the next decade, permanently reconfiguring the tech giant’s
operations around the dispersed structure that the coronavirus pandemic
forced on it”
• Twitter and Square CEO Jack Dorsey informed employees that they could
work from home indefinitely even after the COVID-19 lockdowns end
• Shopify CEO Tobi Lutke announced that employees will permanently work
remotely until 2021 and said the era of “office centricity is over”
• “The New York Times reported this week that major firms like Barclays,
JPMorgan Chase and Morgan Stanley are all debating whether they really
need to maintain the more than 10 million square feet of New York office
space. The three firms have more than 20,000 employees in the city, but it
seems remote workers are doing just fine from home”


https://citronresearch.com/wp-content/uploads/2020/05/RH-The-Clear-Winner-from-the-De-Urbanization-of-America.pdf

 Understand context. This about the high end rental market in NY, not ownership. 

We know WHY the cities of SF and NY are pricy. The question is will people still see it as worth the premium rent when they can live in affluent suburban areas without the claustrophobia, fear of a 2nd wave, more bang for buck and a general peace of mind.