The CEO of a top NYC brokerage shares his predictions for the city's real estate market, a combination of how it bounced back from the last 2 recessions
- Frederick Warburg Peters, the CEO of New York-based Warburg Realty, told Business Insider that he believes the city's housing market will react to the coronavirus pandemic much like it did after 9/11 and the 2008 recession.
- Like after 9/11, he sees several months' of a lack of activity, and like after 2008, an initial hit to prices of anywhere between 10% to 20%.
- Over the course of a year or two, he sees prices getting back to where they were on February 15 of this year.
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There are now more than 55,000 cases of coronavirus in the US.
As the government cracks down on measures to mitigate its spread, industries around the globe are grappling with an unprecedented downward shift in business. And it's especially hard to show real estate.
Brokers around the country are navigating statewide lockdowns and shelter-in-home orders as open houses are canceled and prospective buyers remain on the sidelines amid both virus and recession fears.
While the fate of the housing market is still uncertain, some industry professionals are making predictions. Frederick Warburg Peters, the CEO of New York-based Warburg Realty, said he believes New York City's housing market will react to the pandemic much like it did after 9/11 and the 2008 recession.
"Like 9/11, I think we will see several months' with a lack of activity in the real estate markets in NYC, followed by a quick pick-up once life in the city begins to return to normal," He explained. "And like 2008, I think prices will initially take a hit of anywhere from 10% to 20%, depending on how long we are all sheltering in place, then begin to climb back."
Peters said he doesn't expect prices to shoot back up once shelter-in-place is lifted. Instead, he said he believes that over the course of a year or two, prices will adjust back to where they were on February 15 of this year.
But for now, brokers are trying new things to counteract the pandemic's effect on their business.
As Curbed reported, brokerages like New York-based Ideal Properties Group and Brown Harris Stevens are encouraging agents to offer virtual tours. In fact, a team from Compass has gone as far as partnering with RICOH Tours to stream open houses.
As for broker Tania Isacoff Friedland of Warburg Realty, being prepared requires being creative.
"We are all trying our best to keep our current deals on track and facilitate as many closings that can be held remotely as possible that were previously scheduled during this time," she explained. "I am speaking to my clients by phone and in some cases video conferences. We are working on ways to do virtual showings via Facetime or recorded video tours. Constant communication during these unprecedented times is key."
Since REBNY and StreetEasy have stopped counting the number of days a property has been on the market, in an attempt to help brokerages during these uncertain times, Friedland is keeping her listings active. She is also using this time to incorporate more technology into her marketing strategy - eblasts, videos, and virtual tours - and stresses the importance of keeping in contact with clients.
"Don't sit back and wait for social distancing to end to resume working," she said. "This is the time when we as brokers should be in constant contact with our customers and clients to reassure them and guide them on the rapidly evolving market conditions."
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