A report from Forbes on New York. “Landlords in New York City and across the country are offering more flexible rental options in response to demand from renters facing unclear economic futures. The number of listings for short-term or month-to-month leases jumped 70% and the share of furnished rentals rose by more than 40% over last year, according to data from New York City listing site StreetEasy. Nationally, Zillow saw an unprecedented surge in rentals for six months or less starting around the week of March 10. Between that day and the end of April, there was a 33% increase in short-term rentals.”
“Jared Antin, director of sales at New York City brokerage Elegran, says he’s seen some landlords offer tenants to renew leases for three to six months and in, some cases, allow tenants to go month to month. ‘Landlords would rather have a paying tenant in place than risk units being vacant and having to find another paying tenant,’ Antin says.”
From WGBH in Massachusetts. “A Massachusetts landlord organization says the state’s emergency eviction moratorium is already creating turbulence in the rental housing market. Douglas Quattrochi, executive director with the group MassLandlords, said he estimates 20 percent of rent payments have gone uncollected from landlords since the coronavirus shutdown, and that’s created a long-term problem of hundreds of millions of dollars in unpaid rent.”
“Quattrochi said the college housing market has seen the bottom fall out, mainly because college housing arrangements disintegrated when most college classes went online and students moved back home. As a result, many of the households disbanded. ‘We’re seeing a lot of increased vacancy in three bedrooms because a lot of times three college students will rent, or in Boston, it can be up to four legally,’ he said.”
The Miami Herald in Florida. “Landlords might finally be cutting multifamily renters a break in South Florida, with Zillow reporting decreased asking rents for new leases since the pandemic. The average asking rents decreased year-over-year and month-to-month for multifamily units in Miami-Dade, Broward and Palm Beach counties, according to Zillow. Landlords will likely renegotiate rent with existing tenants and make concessions or, in the last resort, lower asking rents for new tenants, Olsen said, in the months ahead. ‘Landlords do not have a huge incentive to evict tenants,’ said Skylar Olsen, senior principal economist at Zillow, ‘because they have their own maintenance costs, mortgage, and insurance payments for the property.’”
The Tampa Bay Times in Florida. “The first condo tower built on Tampa’s Bayshore Boulevard in 15 years has completed the construction phase and is ready for its residents to begin moving in, developers announced. Residents are paying at least $1 million for each of the luxury units in the 24-floor tower, though some went for more than $5 million apiece. Even though the coronavirus pandemic has affected many luxury apartment complexes in Tampa Bay — prompting many of them to offer free months of rent or other perks — Virage’s sales were largely unaffected. That’s because much of their units were already secured before the pandemic began, with all but four having been sold by this time last year.”
The Daily Advertiser in Louisiana. “Lafayette Parish had 83 pending sales in the first week of March, compared to 45 the final week leading into April, a drop of 45%.T he problem has been particularly pronounced for properties requiring ‘jumbo loans’ — loans for properties that are too expensive for a conventional loan. Jim Keaty, president of the Realtors Association of Acadiana, said any loan not backed by the government is difficult to come by.”
“There are also issues for investors looking to build large residential properties, like apartment complexes. ‘The banks aren’t lending money for those right now,’ Keaty said. ‘I guess because they’re concerned about people paying rent.’”
The Union Tribune in California. “A well-known real estate tracker is predicting a 10 percent drop in rents in San Diego County by the end of the year because of the economic fallout of COVID-19. CoStar says the average rent now, around $1,840 a month, should drop to roughly $1,664 a month by the last three months of 2020. It would be a historic decline considering rents hardly changed during the Great Recession and San Diego is often considered one of the most resilient multifamily markets in the nation.”
“Joshua Ohl, CoStar managing analyst, said the extra $600 people are getting on unemployment from the federal CARES Act runs out at the end of July and there doesn’t seem to be more stimulus checks coming. ‘In my judgment, I think that once the stimulus checks and the $600 a week sweeteners fall off, people are just not going to be able to make rent payments,’ he said. He said the formula also considers the downward trend seen in the last few months.”
“Ohl said much of CoStar’s analysis looks at losses among high-end apartments that have popped up all over the county, especially downtown and University Town Center, in the last few years. The vacancy rate in University Town Center, where a high percentage of new apartments are located, has gone from 6.16 percent in the fourth quarter 2019 to 6.5 percent now. Rent in UTC has fallen from $2,535 a month to $2,402 in the same time period, but calculating the actual rent can get tricky because of the increase in concessions.”
The Los Angeles Times in California. “Nowhere in Los Angeles are the logistical, financial and health complications of the coronavirus outbreak on greater display than at Park La Brea — the largest housing complex west of the Mississippi River. Park La Brea has slashed the rent on vacant apartments in recent months. That has encouraged existing tenants, many of whom are looking to save money in an economic downturn, to break their leases and move into other apartments within the complex.”‘
“David Patton, 63, lived in a two-bedroom, one-bathroom garden apartment with his wife and son. They paid $2,660 a month. But the family found a slightly larger apartment in Park La Brea — for $400 a month cheaper.Patton said he would have preferred if Prime Residential Apartments had just lowered the rent for his previous apartment. But that wasn’t the deal. ‘It was inconvenient,’ Patton said, ‘but the inconvenience was outweighed by the economics.’”
From Bloomberg. “Uber, Lyft and Airbnb have slashed thousands of jobs. Salesforce and Visa are letting employees work remotely for months; Twitter and Square are allowing them to do so for good. For the companies’ hometown of San Francisco, the moves are early signs of a dire blow. In a city with a long history of booms, busts and natural calamities, the coronavirus pandemic has suddenly upended nearly a decade of prosperity.”
“The pain wreaked by the pandemic is only accelerating negative trends for the city, such as the departure of companies, conventions and residents to less-expensive areas, said Ken Rosen, chairman of the Berkeley Haas Fisher Center for Real Estate and Urban Economics. ‘The boom is over, and the question is how deep will the bust be,’ said Rosen, who warned the city may have diminished appeal to the tech industry. ‘We are going to need dramatic changes if we’re going to keep our golden goose here.’”