Page 11 - CooperatorNews New Jersey Winter 2022

NJ.COOPERATORNEWS.COM COOPERATORNEWS NEW JERSEY —WINTER 2022 11 Your Association is in Good Hands with Homestead Management Services. Responsible Property Management that responds to your needs • Personal, responsive customer care with 24/7 emergency call service • Modern, fully intergrated databased network for quick response to problems and solutions • Live, expert staff of experienced management personel A complete financial package: • Complete Monthly Financial Statement •Accounts Payable • Accounts Receivable •Deliquency Report •Annual Reports www.homesteadmgmt.org Family owned with over 35 years years of experience 328 Changebridge Rd. Pinebrook, NJ 07058 973-797-1444 284 Rt. 206 South, Hillsborough, NJ 08844 908-874-6991 © AAMC ACCREDITED ASSOCIATION MANAGEMENT COMPANY made it a central theme of Bill Clinton’s down to the mid twos.” And with the 2008 successful bid for the presidency, the U.S. economic recession and foreclosure crisis as economy dictates the country’s direction. pretext, lenders have enacted stricter stan- In terms of residential real estate, overall dards and tighter underwriting procedures economic conditions are both a driver and to mitigate another housing bubble, which a byproduct of transactions. A confluence Miller contends bodes well for market re- of several economic factors played into the covery as we head into 2022, especially if rollercoaster year that 2021 was, and is likely demand remains high. to keep 2022 dizzying as well. According to residential real estate ex- pert Jonathan Miller, president of New up with the demand. A pre-pandemic high- York-based appraisal firm Miller Samuel, rise construction boom, along with the the urban exodus brought about by the CO- VID-19 pandemic was preceded by more kept up a steady pace of listings. It’s also of a trickling, starting in 2018 when the kept prices somewhat stable—which has Trump administration lowered the cap on not been the case in the suburban and rural the amount of state and local tax (SALT) markets, where demand has overridden in- deductions allowable on federal income tax ventory and prices have soared out of reach returns. This legislation inspired residents of for many. This is another reason why many high-tax states like New York to take up resi- dency in states like Florida with lower taxes, shifted their attention back to co-ops and especially those from Manhattan, “because condos in cities. “As the suburban frenzy of the greater wealth and mobility \\\\\\\[there\\\\\\\] waned and the market started to normal- than any other market in the region,” says ize, the city woke up,” says Miller. “Whether Miller. “During the lockdown, there was a we’re talking about Boston, New York, or tremendously significant pattern of out- bound migration—not just to the suburbs, play heavy volume with a return to normal but anywhere in the United States, driven by seasonal patterns.” He adds that pricing is the SALT tax.” The trend accelerated in 2020 and early 2021, after the pandemic-driven abandon- ment of (and arguably, elimination of the filiates in 50 states and 19 countries, sees the need for) offices. Working remotely became same thing happening in her region. In the the de facto norm in many fields. If regu- larly commuting to a centrally located office was a mass exodus to the suburbs and ru- was no longer a necessity for many work- ers, those who could decamped to second moved to New Hampshire to work remotely. homes (what Miller now terms “co-primary The condo market took a hit because it was homes”), or to entirely new environs alto- gether. According to real estate experts, 2022 back. There will always be people who want might see more of an inward migration and to live a downtown lifestyle—particularly a more robust outlook overall. Among the younger millennials.” reasons for their optimism, the pros cite re- marks from the Biden administration about raising the SALT deduction cap, as well as of dense, crowded living and sent many the general economic recovery, bolstered seeking more space for incorporating work by hopes of further reductions in COVID and school (and gyms and media rooms…) infections, hospitalizations, and deaths. into their homes. A year and a half later, with There’s also the prospect of the easing of vax rates up and more awareness about the travel restrictions bringing foreign and out- of-state buyers back to urban markets. Yet another factor in play is the rise and ing lasting changes to our built environ- fall of interest rates, which significantly af- fect sales volume. That’s particularly true in systems to apartment layouts to structural the co-op and condo market, which tends material choices. It has also accelerated the to attract first-time homebuyers and others adoption of both technologies and policies using financing to make home purchases. that make it possible to conduct much of the With interest rates falling to record lows nation’s business from anywhere—allowing over the past 18 months, along with rents for the integration of home and work like rising considerably in many areas, younger never before. and newer buyers are entering the purchas- ing market at a greater pace. “I don’t think enough credit is given to home is going to go through a process of be- the intense demand that has been fueled by ing sorted out over the next couple of years.” record low rates,” says Miller. “Prior to the pandemic, the 30-year fixed over two years fell from around 5% to a little over 3%. And then after the lockdown, because of the pan- demic, rates fell from the low to mid threes Miller goes on to say that inventory in the co-op and condo sector has so far kept urban exodus earlier in the pandemic has younger and first-time home seekers have Florida \\\\\\\[housing\\\\\\\] markets, they still dis- creeping up toward pre-COVID levels. Dorothy Manning, a Boston-based real- tor with eXp, an online brokerage with af- early months of COVID, she says, “There ral America. Many \\\\\\\[Boston-area\\\\\\\] people flooded with units for sale. It has started to pick up, though, and buyers are coming It’s Also the Pandemic COVID’s initial wave made people leery virus and how it behaves, cities have made a comeback—but not without COVID mak- ments, altering everything from ventilation “Remote work is here to stay,” says Mill- er, “and that relationship between work and YEAR IN (P)REVIEW continued from page 1 continued on page 12