Total existing-home sales—completed transactions that include single-family homes, townhomes, condominiums and co-ops—rose 3.1% from December to a seasonally adjusted annual rate of 4.00 million in January.
GATEWAY PERSPECTIVES: Don’t Let Our Guard Down
Back in the height of the lockdown caused by COVID-19 in April and May of this year, on weekends I would venture out of my apartment in Manhattan to take a walk in Central Park. It was a very scary time, especially in April. The number of COVID-19 cases and deaths were climbing at alarming rates. People weren’t just keeping six feet of distance from other people—it was more like six yards. In many ways New York City seemed like a ghost town with many residents fleeing to vacation homes.
Fast forward to this weekend when I took the same walk in Central Park, and it could not have been a more different experience. People were out in droves enjoying the fall weather. The outside areas in front of restaurants were packed. The MET was open and people were milling around the front. What I was most impressed with was everyone, on the sidewalks and in the park, with very few exceptions, were wearing masks. I couldn’t help but feel gratified that we live and work in an area where masks have not been politicized.
While the national numbers of COVID cases has escalated recently, and New York has experienced a slight uptick of cases, many of those cases are localized. Also, New York State’s positive test rate percentage continues to hover just slightly above 1%, one of the lowest in the country. There was significant trepidation that the reopening of New York City schools would fuel an increase in cases, but the initial testing has resulted in few positive tests. Out of an initial testing pool of just over 15,000 staff and students, so far only 18 tests have come back positive.
While I am optimistic that we are turning the corner in New York State, I would call it cautious optimism. We cannot afford to let our guard down. The mantra of “wear your mask, practice social distancing and wash your hands” has to continue. Where my optimism waivers are my concerns for the economic picture for New York. While the market for single-family homes in the New York suburban market continues to surge, the Manhattan market languishes. While shares in Zoom continue to head higher and higher with employees working from home, commercial offices sit vacant and the stores and restaurants that serviced those workers prior to COVID are now shutting their doors.
As I’ve said before, the New York State economy is driven by the New York City economy, and we need to develop a roadmap for economic recovery for New York City if the state is going to fully recover. That roadmap cannot include regressive taxes like pied-à-terre taxes and increased transfer taxes, which discourage purchasers and put downward pressure on sales and prices in an already struggling Manhattan real estate market. What the roadmap does need is assistance for landlords and building owners. In many instances, landlords are still having to pay property taxes and make mortgage payments with diminished rental payments. This creates a lose-lose scenario for both landlords and tenants, when in reality we need a roadmap that throws a lifeline to both landlords and tenants.
We are at a very fragile juncture in our road to recovery in New York State. Now is the time to be bold and aggressive—it’s not a time to set up road blocks to the recovery with regressive tax policies that put out a “not welcome” doormat at New York City’s front door.