Key Highlights

  • Wealthy New Yorkers moving families and money from Manhattan in hopes of escaping risk of COVID-19
  • As wealthy Manhattan-ites move, they driving up demand and prices in exurbs and neighboring states

The lure of the big city is no longer as alluring as it used to be before the COVID pandemic. High-end sales activity and interest are shifting from the lights of Broadway to less densely populated places and less COVID stressed areas.

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New York City has been hit hard by COVID with more than +35% of the nation’s total cases and half of New York State’s totals, nearly 175,000 confirmed cases, and more than 18,500 deaths, according to latest data from John Hopkins University. No wonder those who can afford to leave are leaving, if only temporarily.

Wealthy buyers and renters want two things…more space and more distance from others. Owen Berkowitz with the Berkowitz Marrone Team at Douglas Elliman, said, “I can’t remember the last time we were this busy.” Servicing Westchester County in NY, Fairfield County in CT and other high-end markets around Boston, Berkowitz is obviously in the right place at the right time.

Steven Magnuson, another Elliman broker in Greenwich CT, is also in the right place at the right time. Handling a five-bedroom home that recently generated a record high monthly rental of $55,000, the owner has raised the rent to $65,000/month and there is a waiting list of 18 people waiting to see and move into the property.

Magnuson said, “It seems like everyone wants to leave the city. Our problem is not enough inventory…we’ve been on the phone 24/7 and on email.”

Big, sprawling homes with lots of bedrooms and living quarters, pools, home offices, strong internet and cell services, large land parcels and remote locations are again an asset rather than the liability they were during both the 2008 housing recovery and the recent lid on state and local tax deductions during the recent rewrite of the tax code in 2017-2018.

Even in Hudson Valley, long popular for more affordable weekend homes, is attracting wealthier New Yorkers. Jeff Serouya with Berkshire Hathaway Home Services/Hudson Valley Properties, said, “I’m seeing a much higher wealth level of buyer than we’ve seen in the past right now. They’re looking for the highest quality…” and more amenities. The only limitation? Low inventory.

How long will this exodus from the city last? Magnuson said, “Even if there is a vaccine (for COVID), being able to go someplace, not far from your home, where you have a home office, too – and be able to keep your friends and family safe, that’s number one.”

Know also that other locations around the country much farther from NYC are being inundated with fleeing New Yorkers. Robin Riegor, a long standing, well regarded agent with Coldwell Banker Legacy in Albuquerque NM, said, “In the midst of all this (COVID) upheaval, I’ve never been busier and I’ve never before worked with this volume of New Yorkers.”

 

Thanks to CNBC’s Robert Frank.

Also read: Trump Activates National Guard in New York State, Washington State and California, Let’s Hope the 2nd Go-Around with PPP is Better than the 1st, Weekly Purchase Applications Recover as Rates Hit Record Low