BloombergBy Oshrat Carmiel
March 24, 2020
It wasn’t long after Katy Bekiarides listed a home for rent in suburban New Jersey that a client from New York City came by, had a look, and said he’d think about it. Two weeks later, as coronavirus cases mounted, he was done thinking. He wanted the house in Tenafly immediately.
“I didn’t realize what he was doing at first, but then it dawned on me,” said Bekiarides, a broker with Sotheby’s International Realty. “He wants to get out of Brooklyn.”
New York City has benefited from a decades-long renaissance, reversing an exodus that was ignited by crime and a fiscal crisis in the 1970s. Now, the virus is revealing anew the disadvantages of urban living, as anxious city-dwellers flee to greener -- and more sparsely populated -- pastures. Playgrounds and subways are suddenly a no-go, and apartment buildings, where neighbors pass in narrow hallways, seem risky. Families, huddled in close quarters while working remotely and homeschooling children, also could use some space to stretch.
That means the suburbs -- battered for years by concerns over sky-high taxes and crumbling commuter lines -- are having a moment. Homes stagnating on the sales market are now being fought over as rentals. One Greenwich mansion for lease, promoted in a Manhattan moms Facebook group, drew 60 inquires the first day. Some buyers in the Hamptons are forgoing home inspections in a race to get a deal closed and move in.
“There are clearly a lot of people who prefer to put 4 acres of social distance between them and their neighbors rather than 12 inches of wallboard,” said Mark Pruner, a broker with Berkshire Hathaway Home Services in Greenwich, the Connecticut suburb popular with Wall Street elites.
By Pruner’s count, 33 Greenwich homes sold or went into contract in the seven days through March 15, the highest weekly tally this year. Last week, as bans on gatherings began to take effect, there were still 17 sales transactions, he said.
The demand for short-term rentals is even greater -- so much so that Pruner called all six sellers listing homes with him and asked if they’d like to lease them out while waiting for buyers.
Just north of the city in Westchester County, the brokerage Houlihan Lawrence lined up a furniture-rental company to help repurpose empty homes as agents fielded calls from clients seeking immediate short-term leases, said Debbie Doern, senior vice president of sales. One listing -- a five-bedroom home in Bedford with a swimming pool and movie theater that was seeking $2.87 million -- is now being rented through September by a family of four from New York City, for $25,000 a month.
Stefanie Lacoff had a similar idea for the 16,000-square-foot Greenwich home her parents bought but hadn’t moved into yet. The Berkshire Hathaway broker posted a picture of the property, with its perfectly manicured hedges, on a Facebook Group for Upper East Side moms, offering it for short-term lease without specifying the $35,000 monthly price tag.
‘Get Me Out’
The messages poured in fast -- and while there are still no takers for the place, many asked for help finding other out-of-the-city options.
“Usually they’ll tell me a little about themselves, their kids’ ages, their price ranges,” Lacoff said of her standard client introductions. “Now it’s just like, ‘Get me out of here.’”
Bekiarides’ New Jersey clients are holding onto their Brooklyn Heights apartment for now, while signing a six-month lease in Tenafly, with the option to renew for another half year. “He just wanted a place so he can escape,” she said.
In the Long Island beach towns of the Hamptons, homes listed for summer rentals are adding options to start the season now, while many schools are closed and families need a place to spread out, said Eddie Shapiro, chief executive officer of brokerage Nestseekers International.
One rental handled by his firm -- for a Southampton home also listed for sale at $6 million -- drew a bidding war that took the monthly asking rent to $50,000 from $42,000. The family leasing it will be there through Labor Day.
Developers are getting into the act, sensing opportunity in a market where sales inventory is swelling.
Max Breskin had been trying to sell three new Southampton homes he completed last year, one of which had been furnished. That 7,100-square-foot property with a pool found takers quickly when listed for rent two weeks ago. The other two similarly sized homes will be furnished and leased temporarily as well, he said.
12 Julianna Way in Southampton, New York. Source: James Giugliano of Nestseekers International
Families fleeing the city might take a cue from New York Governor Andrew Cuomo, who at a press conference on Monday said urban density contributes to the spread of the virus: “A lot of people are touching a lot of spots, right?”
As Covid-19 cases mount in the city’s crowded environs, the frenzy to leave might even trickle through to the sales market, said Shapiro, the Nestseekers CEO.
He had feared the virus, and the financial turmoil it’s causing, would spur buyers to walk away from contracts. Instead, it’s made them eager to close more quickly. They’re waiving inspections and forgoing mortgage financing -- anything they can do to lock down a home away from the city.
“They’re like, ‘You know what? We’re done with this,’” Shapiro said. “‘We need a house, with a fence around it, on some property.’”
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