There has been a lot in the news about the economic downturn of the US lately. From where I am, it is hard to see how much of that is real and how much of that is perceived. However there are a couple of interesting indicators that show me that some of the economic downturn is hitting the Upper Eastside of NYC.
Vacant Shops
Firstly, there are more and more empty shops in my neighbourhood. Ever since I lived here there were shops which went out of business. However mostly it happened ‘over night’ that means that unless you were looking for the specific shop you would not notice that there is new shop. Shops would close and reopen practically overnight and real vacancies were seldom. However, this changed lately. I didn’t bother to count them all but from walking around I would estimate that within a two blocks perimeter area from where I live there are at least 15 to 20 shops currently empty.
Fewer Sunday crowds in the lobby
I live in a building that has many apartments and usually you can’t use the elevators on Sunday noon since there is the ‘Sunday crowd’ of prospective condo owners channelled through vacant or soon-to-be vacant apartments. In the past this crowd was quite large and the visiting hours were packed with appointments. The situation changed a bit now. You still meet people willing to spend some money on the real-estate market but the elevators and lobby are much less crowded that just a few months ago.
Almost no broker ‘success’ cards in the mail
Don’t knowing the real estate marked from the inside, this is the strongest indicator to me that the real estate market in my neighbourhood came to a grinding halt. Just a few months back I would receive at least 5 post cards per week boasting about a recently closed deal “over asking price! Less than a week on the market!” – not only in the building but in the area. These cards became fewer and fewer and the language changed from “sell / buy now” to “why it is good to sell or buy now even though we are in a crisis” to “wonderful 3 bedroom just lowered the price”. The last card I got was about two weeks ago and was an indication of an apartment lowered in price. I haven’t heard of a successful deal in long. And yes, I’m aware that real estate deals might still be out there and that some people still buy, but it doesn’t seem to be worth the few cents for a post card to let everybody in the neighbourhood know about that.
To watch all this from an outsider’s perspective is very interesting so let’s see how these changes affect the dynamics in Manhattan. With a number of new apartment buildings being built now, fewer jobs in the financial sector I hear a lot of my friends thinking about how to capitalize on the softening rents in some parts of Manhattan by moving the next time their lease is up for renewal.