Just last month…
I wrote about five little things that, if improved, would help our real estate market get back to full health more quickly (you can read it all here). They were:
- Bringing Back Normal Open Houses
- Getting Managing Agents back to Full Speed
- Eliminating COVID forms
- Brokers Making Themselves Readily Available for Appointments
- Getting All of Our Crazy Neighbors Back in Town!
Within just two weeks, New York State hit its 70% benchmark (of people vaccinated) required to begin fully reopening the city. This unleashed a whirlwind of activity that included relaxing nearly all restrictions, and permitted all vaccinated people to go just about anywhere without masks. The effects were immediate in the real estate industry:
No More COVID Forms
Imagine the frustration of having to have “voluntary” forms completed for every single real estate showing. We knew that no one was ever going to look at them. They were not updated since late 2020 before vaccines came out. It was the illusion of safety. But worse, it became an utter frustration for the industry. The bane of everyone’s existence. And now…they are gone! Poof! No more. You can hear the sound of paper forms being burned across Manhattan. It’s a miracle.
As of 6/15/21, NORMAL open houses are allowed! This means a few things. First, it means that as long as each building permits it, all the nosy neighbors may return to snooping into other shareholders’ apartments. Last minute viewings, effient for everyone involved, may happen. The serendipity of accidentally falling in love with an apartment may happen. The casual lookers don’t have to pretend their are serious to get in. It is a cascade of joyful real estate viewing, made possible by the return of in-person viewings without appointment. Now, brokers may not be as excited at the prospect of sitting in empty open houses, but I’m actually very excited for sellers. In this market, as things are red hot, it means that the market for these well-priced units may find a higher level, as simple economics come into play. The more people see apartments, the higher likelihood that the price will move up. All the way around exciting!
I was on a Clubhouse chat (where I appear most Thursdays), and I heard one of my colleagues suggest to brokers that they cancel their summer plans, as the market was just that busy. I don’t see that happening. Quite the opposite. It seems that the deals are really to be had right now, even if we are at record weekly sales numbers. What I mean is that by the time we hit September, and everyone is really back in full-speed mode, watch out. The market may be sizzling today, it’s going to be insane come September. All I can hope is that with COVID forms gone, we’ll see enthusiasm on the part of agents to schedule access more readily. But I’m not holding my breath.
Managing Agents More Available? Heck no. Sadly.
Managing Agents and their backlog is getting worse, not better. I see no light at the end of that tunnel. You see, buildings aren’t paying their managers more money to process more transactions. They can’t really add more staff given their tight margins. So what we have is transaction pace up about 60% right now on a month-to-month basis, and no more people to manage it. It is a total disaster. Sellers and buyers are furious. I had a situation today where a closing had to be scheduled one month in advance. Come the week of the closing, the managing agent said, “Oh, just mail in all the paperwork.” Translation- the closing could have happened at any point in the last four weeks, since there’s nothing time sensitive. Imaging the fury of a seller who had to carry his apartment for no reason!
There will be many other things that get in the way of transactions, but we are absolutely on the road to recovery. The optimism in the city is palpable, and as we incorporate the mature technologies like 3D touring and video tours into the old school property visits, we should see massive action. This can only lead to price appreciation in no time. -Scott