A report from CNBC. “‘Everybody I know is leaving,’ said Michael Kronenberg, who owns a downtown Manhattan apartment. ‘It’s not just New Yorkers. My partners, long-time clients and investors of mine that live in Connecticut or New Jersey, they are used to commuting in to the city. They’re never going to commute in five days a week ever again.’”
From Forbes on New York. “Manhattan’s rental market is all about concessions and more concessions. ‘In markets that are more favorable for renters (more available units than demand to fill these units), landlords may offer concessions to entice renters to pick their property,’ explains Senior Managing Editor of Apartment Guide Brian Carberry. Despite significant rent decreases the over-supply of available units make this a renter’s market. Currently even these lower prices aren’t luring an abundance of renters to sign leases.”
“Edgar Romero owner of a luxury condo at 100 Barclay Street in Tribeca understands the current climate. ‘In these difficult times, flexibility on both sides of the rental market is necessary. Concessions must be made to keep the market moving on some level with the exodus we have seen from the city.’”
From Bisnow on Massachusetts. “Boston remains one of the most expensive cities in the country, but apartment prices continue to fall precipitously. The average rent for a one-bedroom apartment in Boston this month is $2,210, according to Zumper’s November National Rent Report, with the median rent falling 12.6% in the past year. Multifamily property owners are feeling the pinch in Boston, where landlords collected just 68.6% of rents between Oct. 1 and Oct. 6. The rental collection drop-off rate of 11.7% was the largest among the country’s major markets. The Metropolitan Area Planning Council earlier this month indicated nearly 1 in 6 Massachusetts renters were behind on rent payments, and an estimated 60,000 households face eviction.”
From Bisnow Washington DC. “The restaurant industry’s nightmare year is about to get even darker. The cold weather is expected to slow demand for D.C. restaurants and make it more difficult to dine outdoors, a factor that has helped keep businesses alive during the pandemic. Geoff Dawson has already shut down one of his restaurants during the coronavirus pandemic, and he owns multiple large beer halls in and around downtown D.C. ‘It’s going to hurt a lot,’ Dawson said. ‘So many businesses are on the razor’s edge right now going, ‘OK, I think I can be here another two weeks, maybe three.’ That’s the nature of sitting dead in the water. We don’t see any answer.’”
“He said his bars across the board are doing around 20% to 25% of their typical sales, but business is particularly hard in the office-heavy downtown area. For this reason, he said he still hasn’t reopened Astro Beer Hall at 13th and G streets NW. ‘Downtown is dead as a fence post. There’s nothing going on. Nothing,’ Dawson said. ‘Nobody’s working, nobody’s visiting, nobody’s out being happy.’”
From Seattle PI in Washington. “Since the start of the coronavirus pandemic, rent prices have been dropping across the Seattle area. In October, that trend continued once again. Month over month, Seattle rent prices in October dropped 4.2%, ApartmentList found. Since the start of the pandemic, the city has seen its rent prices drop by 14% — the third most significant drop across the country, according to the study. It marked the seventh month in a row Seattle has seen its rent prices decrease.”
“Since March, rent prices were down in 41 of the 100 largest U.S. cities. Rent prices continue to fall more quickly in ‘pricey coastal cities,’ the study said. ‘Workers who have been laid off or furloughed in these cities likely have little buffer to continue affording sky-high rents.’”
The Los Angeles Times in California. “When Alan Abdo negotiated with his landlord to end the lease for Olive Tree Restaurant, he remembers saying, ‘I can’t close fast enough. I’m losing money by the minute.’ Olive Tree was a thriving, well-known Middle Eastern restaurant in Anaheim right up until the enforced business closures began. ‘The day before, we were still busy,’ owner Alan Abdo said. Then, he began losing ‘between $15,000 and $20,000 a month.’”
“Though some restaurants have successfully pivoted to takeout, Abdo said it didn’t work for Olive Tree — when they tried it, he said, they didn’t come close to breaking even. ‘I’m a nice sit-down restaurant. …We weren’t a fast food place,’ Abdo said. ‘On average people spent between $21 and $25 a person when they came into the restaurant. That was too expensive, especially with people losing their jobs.’”
“Despite the pain of losing Olive Tree, Abdo said he felt good about his decision to close permanently. ‘Everybody’s losing money. Well, I stopped losing money,’ he said. ‘It seemed like I was the smartest guy in the restaurant business.’”
From NBC Bay Area in California. “It’s no secret that since the pandemic started, California is seeing an exodus. Now a new study says the Bay Area appears to be getting hit the hardest. Santa Clara-based company Upwork surveyed more than 20,000 people and found that cities with the highest housing prices are seeing the largest number of people leaving. Adam Ozimek, chief economist at Upwork, says you can already tell there is a Bay Area exodus by looking at the recent rental market. ‘You can look at San Francisco, San Jose and the general area and see that apartment rents are declining rapidly,’ said Ozimek.”
“Scott Fuller is the founder of a company called ‘Leaving the Bay Area’ that helps clients relocate to less expensive places. He’s seen the trend but adds that the work from home trend isn’t the only recent event pushing people to leave. ‘It certainly has increased, really probably in the last 30 days,’ said Fuller. ‘Especially with a lot of the issues we’ve had with fires. You take a lot of these collective things that have happened in the Bay Area and in California, and at some point, people kind of reach their tipping point.’”
The Motley Fool on California. “Real estate agents in San Francisco are struggling to move condos off the market as inventory is up and buyers don’t seem to be biting. They’re getting so desperate, in fact, that they’re starting to offer huge incentives to entice buyers to make offers. But should investment property owners in San Francisco be worried?”
“Active listings for San Francisco condos are up 114% year over year, and while it’s not unusual for there to be more available condos than single-family homes, there are currently two condo listings for every single-family home available on the market. As such, the average price per square foot for condos has decreased 4% since 2019, and the number of buyers outbidding each other over asking prices is declining.”
From Atlanta Agent Magazine in Georgia. “A whopping 1.55 million (1.6% of all homes) are currently vacant, and just over 200,000 homes are going through the foreclosure process, according to ATTOM. The report added that the numbers are driven in part by the ban imposed by the CARES Act that prevents foreclosures on federally-backed home loans. Georgia is among the most hard-hit states, according to the report, which showed that zombie foreclosures are largely clustered in the Midwest and South. Georgia had a rate of 9.56% for properties in foreclosure and vacant. Atlanta was noted as having a zombie foreclosure rate of 11.5%.”
The Coeur d’Alene Press in Idaho. “Our fall series on North Idaho price cuts comes to a close with a look at some deals in Coeur d’Alene. Conveniently, all of our featured price cuts are located south of Interstate 90 in the heart of Coeur d’Alene. Being close to downtown and Lake Coeur d’Alene comes at a premium, which definitely explains the prices we’ll see compared to previous price-cut-a-palooza installments.”
“A bit closer to downtown and near Government Way are two larger homes with enticing price cuts. A four-bedroom, 2,800+ square foot home with a multigenerational layout (an in-law quarters with separate entrance) comes with a 24×24 shop and is priced at $674,000, down $25,000 from mid-October.”
“Another $25,000 drop nearby comes in the form of a sprawling five-bedroom, four bathroom craftsman with 4,100 square foot, modern amenities and a detached three-car garage. Price: $925,000 – pretty fair once you take a look at the listing, location and comparables. More price cuts can be found east of Tubbs Hill in and around the Sanders Beach neighborhood.”
“Want new construction near the water in the Sanders Beach neighborhood? Got a million bucks? Well, you can save $60,000 now on a four-bedroom, 4.5 bathroom 2020 home with almost $3,000 square feet and a ton of fancy modern things (including a hot tub!). Price: $1,099,000.”
“The more money you have, the more you can save… at least in the case of another Sanders Beach property with four bedrooms, 3,300+ square feet and everything fancy. A price cut last month slashed $200,000 to come in at $1,800,000. Folks with that kind of money can buy a few extra cars with that savings.”