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BrickUnderground is taking a brief hiatus this week, but we leave you with this glance at the shape of things to come, assembled with the help of our amazing expert panel. From pet rules to bed bugs to renovations, here are our predictions for the New Year:
- Dogs: No-pet rules will continue to lose their teeth as more apartment dwellers become savvy to the “emotional support pet” exception. As a result, some no-dog buildings may become "some dogs" buildings, regulating the breed or size instead, and perhaps even turning canines into revenue generators by charging residents a fee to have one.
- New construction: As buyers become increasingly savvy about construction defects, they will pay more attention to a sponsor’s reputation for delivering quality buildings.
- Real estate brokers: Continuing the trend of recent years, more buyers will rely on technology (StreetEasy.com, PropertyShark, ACCRIS etc) to conduct their searches rather than work with a broker. Similarly, technology has made it easier for renters to find no-fee apartments and deal with the owner directly, circumventing agents altogether.
- Bed bugs: Bed bugs are not going away anytime soon, but the hysteria and stigma will subside. Sales-wise, notes real estate broker Deanna Kory, "the issue is not going to reach the height of something like what happened with asbestos....It will be more like the lead paint issue which was big but not overwhelming." But BrickUnderground does expect more landlords to screen and reject tenants with bed bug histories, and we wouldn’t be surprised at a political effort to have bed bug history designated a protected class under the city’s housing discrimination laws.
- Renovations: A recent surge in demand for family-sized apartments that is allegedly outstripping supply in some neighborhoods may set the groundwork for a surge in combinations of smaller apartments. Higher interest rates that make moving more expensive may also encourage renovations. Meanwhile, more boards (though not enough) will enforce higher standards for soundproofing and odor-proofing both during renovation and afterward. "New co-op shareholders expecting literally carte blanche in their proposed renovations are in for a rude awakening as more co-ops are limiting the degree and scope of proposed projects,” notes property manager Thomas Usztoke. While the floorboards and baseboards are up, we also predict that smart residents will take this opportunity to do some bed bug proofing.
- Non-smoking buildings: While we expect some progress toward smoke-free environments, we don’t foresee a surge in buildings going cold-turkey. Boards will be too distracted by more pressing financial issues to undertake this political hot potato, and they are sensitive to doing anything that could potentially hurt resale values (not that there is any proof of that—and in fact, these days, it may be the opposite).
- Suburban flight and/or downsizing: Next year may be the tipping point for many vertical dwellers whose rent, common charges or maintenance fees spiral out of control and affordability. "The costs to operate coops, condos and rental property will increase dramatically as a result of the stack of new regulations and laws which have been enacted without thought to the economic consequences," says property manager Paul Gottsegen. He cites a slew of laws enacted over the past year or two around energy savings and benchmarking, exterior repair, and elevator safety among other things. "Add increased real estate taxes, costs related to compliance with FNMA underwriting (flood zone insurance, mandated reserve requirements, and budgeting for insurance deductibles) and you have effectively created two classes of residents; the 'haves' who can afford to live in NYC - and the 'have-nots' who have no choice but to leave."
- Co-op boards: Beset by rising costs, co-op boards will continue to focus on cost-cutting over quality-of-life improvements. Goodbye plans for roof decks, playrooms, gyms. Hello interest in energy-saving measures, remote doorman systems, and higher fees on everything from storage space to renovation fees. Real estate lawyer Eric Goidel also predicts an increasingly relaxed attitude toward sublets and sublet fees: “Many buildings have quite a bit of inventory for sale, driving down sales prices as one shareholder’s apartment is pitted against another….Relaxing sublet rules many enable shareholders who are on the margin to keep their apartments, at least until the sales market firms up.”
- The Ombudsman Bill: We are keeping an optimistic eye on this legislation aimed at leveling the playing field between apartment owners and over-reaching boards. If passed next year, it would create a state government office to educate co-op and condo owners about their rights and provide alternative dispute resolution.
- Scaffolding: With all of the recently mandated repairs that buildings must undertake, scaffolding may be coming soon to a building near you, or even yours. CurbedNY may be able to continue their scaffolding nightmare series for years.
Other predictions? Let 'em rip below. As for us, we'll see you next year.