All Forum Posts by: Phil Wells

There is a reason why NYC-Manhattan and San Francisco is so high. The land mass of the cities are small. There is no where to go but up. SF is a peninsula and Manhattan is an island. These two areas have been some of the most priciest areas for a very very long time.   

Thanks Phil! Yeah I agree it has awesome advantages! My current situation is I've lived in my currently property for 3 years with the VA loan. (Thinking I have to replace it with a conventional loan to use it as a rental.) So in the process of refinancing it. But that also starts my loan off to another 30years with a couple fees in the process. Basically restarting my whole process over again, since I've mainly paid a majority of it to interest.

I was thinking about freeing up my VA loan and use it on my next property as the next loan. But hate the fact that I have to start a whole new loan over again. any recommendations on if I should keep moving forward with the refi? Or should I just save and make my next loan be an FHA? Thanks

@Phil Wells it's an interesting question, thanks for starting this thread.  I think the US is big enough, and still growing enough, that some people may leave cities in the wake of covid AND the attractive cities will also continue to grow.  There's another thread going on BP about the supposed "exodus" from California, and I think the same principle applies.  It's inarguable that California is not growing as fast as it was in the 1990s and early 2000s - and also that more residents are leaving than are moving in - but that's just one measure: domestic migration, not overall growth.  So, just as California isn't actually about to start shrinking even as growth crests, so it goes with the trendy cities.

@Phil Wells Great topic and very possible

I do believe a large shift could happen and downtown office sectors being effected the most. I understand that people still want to live downtown and be close to retail, restaurants, & attractions but I also know a lot of people live downtown bc it’s close to their office.

If a company that pays rent on 100,000+ sq ft of office space and just realized they can almost operate at full strength without that office space, why wouldn’t they keep a “headquarters” but make it 10x smaller?

And if you wfh full time, would most prefer a 600 sq ft apartment to live/work in or a home with an office in it and land around it(for the same price or less, +equity)? I know there are negatives to homeownership and not everybody wants the required maintenance that comes along with it.

Maybe office buildings get converted to condos for the 20 somethings & others that prefer to live downtown. This would be a few years out.

:

I live in NYC and I do think there will be a huge impact. Young families will probably move right to the suburbs whereas they may have raised kids in the city otherwise. A lot of my friends have been “thinking” of moving away from the city for years but never made the change. This is now a catalyst for them to finally have the courage to try living somewhere new.

About half of my friends are looking to move in the fall. That’s probably not the norm, but I think there will be major shifts in the fall & another after the holidays. Many companies are being vague about their policies still, so people are waiting to find out what their options are for remote work long term. 

@Phil Wells the post and premise of the new market disruptor reminds me of the old adage that "the first one through the wall always gets bloody". I believe your really ahead of the ball here. I recall when a few "nut jobs" were talking about how one day we would all be shopping from home on our Gateway PC, and 99% of us laughed at them. A few years later 89%, then 50%, and now Bezos is set to become the first Trillionaire. 

Most often major market disruptors seem completely obvious in hindsight, yet completely unbelievable at the onset.

In my area we have a large CapitalOne headquarters, one of their main national hubs, with covid they had to rapidly implement remote working for the entire staff, and they did. I was speaking with a person from there who will remain un-named about how it's gone and he said the funny thing is productivity has gone through the roof, they have been hitting numbers they could only have dreamed of before, and it's being watched very closely from top-down. I mentioned the expense of there giant high rise and he gave me that telltale side smile, the one that we all know as "your spot on, and I can't say a word".  

It's a well known established metric for a home buyer; schools and proximity to work. Well, we are in a technology age where for a great many positions consist of functions that are fully capable of being completed from a home office, it has been the culture and habits we have that say we must work from an office, that's how it has to be for things to work. Along came COVID and removed choice, it forced us to either embrace remote working or in many cases not work, and so we embraced it. 

We are now past that hump of experimentation, we are now in a time or considering do we want to bring all staff back into office, not "we need to", and with that comes the consideration of cost vs benefit. In addition it spurs the expanding thoughts, if we can run these jobs effectively remotely, wow, we could hire remotely, maybe hire where cost of labor is half???? 

Without doubt this will impact where people live, in a very big way. How can I say very big way, review what the top job sectors have been the last several years, the list is dominated by tech jobs, jobs that are the best candidates for remote working. Who is the biggest demographics that have been focusing on main metropolitan housing, it's that same grouping that's concentrated in the tech sector. So yes, this may be the beginning, of the beginning, of a paradigm shift. 

I believe the moves will be along the line of the remaining consumer motives combined with some of the age old drivers such as good schools, low crime, good internet, nice weather, cool things to see & do, and convenience in food. Shopping, well that's moved to Amazon in a big way so that is becoming less and less a factor isn't it. 

In the end, this is nothing new, neighborhoods move through cycles, many C/D areas are loaded with giant mansion-like homes because once upon a time that was an actual mansion and the area was an A+ area, things changed. 

I think people are moving closer to family members. Whether it's the city or not, people want to be closer to people they know and love after experiencing a pandemic.

IF companies allow employee to work from home more often then I do see the move happen. 

Why would you need to be close to an office that you only go into 2-3days a week? 

@Phil Wells so... "but are people going to trade NYC for a place that's half the price but an hour outside the city, I think so"

yeah, but that's the deal, people already do that, so what's the difference here? I mean, my fried in Mahopac, NY doesn't live there because he loves the commute to Stamford, he lives there because Stamford and NYC are super pricey, and he gets better value for what he wants. The deal is, I don't think in these examples that the 'people leaving' part is the focus... it's where are they going?... having 0.15% of NYC workforce decide to work somewhere else doesn't move the needle much. Now, if you told me they all decided to move to Scranton, PA... well that's suddenly a like 1.6% boost in the population for that town... which is a much bigger deal... so I guess to answer your OP question... I don't really think it's going to affect major cities that much, but, for mid-sized cities that are big enough to have decent broadband footprints, this could be boom times for them. So I prefer, in this situation, to focus on which smaller places are winning bigger in this case than the larger cities are losing.