[NYC] With the market down 40% since the rent laws, I'm thinking about throwing in the towel
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[{"id": "ffcd911", "text": "Not a broker, but the market will shake itself out once some of the loans start defaulting or owners start handing the keys back to lenders. They will generate volume and deal flow. When that will happen is anyone's guess, so hold on until then?", "replies": [{"id": "ffcq3iy", "text": "&gt; but the market will shake itself out once some of the loans start defaulting or owners start handing the keys back to lenders.  \n  \nWith current laws, how would the investment be viable for anyone else to purchase?   \n  \nEven if property values plummet, NYC style rent control makes maintenance impossible.   So the landlord is left with a dilapidated building at the end, no cashflow, and the hope their dilapidated building increased in value?", "replies": [{"id": "ffcvdmy", "text": "At a low enough cost basis, it makes sense. And rent control/stabilization (under the prior formulas) allowed for plenty of profit. The current rules don't, which is why you're seeing devaluations. There will be plenty of pain for current lenders and owners, but the market will find a price based on the current rules. Where that is is anyone's guess.", "replies": [{"id": "ffcw1uu", "text": "&gt; At a low enough cost basis, it makes sense.  \n  \nOnce the cost basis gets low enough, other land uses become more attractive (condo conversions, etc).  It's going to be a rocky few years until the market works out what to do.  \n  \nEasy to forget we are nearing the peak of the current economic cycle, with record low interest rates, and far too much money sloshing around with nowhere to go.   \n  \nWhen that turns (and it will at some point, economic cycles are inevitable, we will at some point have a recession), New York is in for a world of pain.   Likely lots more condo conversions, helping upper middle class renters transition.   Middle class and poorer people will be the biggest losers.", "replies": [{"id": "ffd5fwh", "text": "&gt; Likely lots more condo conversions, helping upper middle class renters transition.\n\nConversions from what? As an upper middle class person looking to transition from renter to owner this comment piqued my interest", "replies": [{"id": "ffdsytq", "text": "MF to condo or coop, this happens often but the NYC condo market has fallen significantly from its peak.", "replies": [{"id": "ffe356w", "text": "so its prime time to grab one? I've only just started thinking of buying here.", "replies": [{"id": "fff3qgt", "text": "You never know, market could soften more. Check out Corcoran condo reports and Douglas Elliman.", "replies": [], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}, {"id": "ffdvt9l", "text": "New laws say you need 51% of tenants to agree to a conversion. I\u2019m no expert, but that doesn\u2019t seem too easy.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ffce11j", "text": "What do you do to generate deal flow?", "replies": [], "depth": 1}, {"id": "ffcifgc", "text": "Why not work in residential real estate for awhile? You're licensed to do it and we can make quick money with rentals. I'm in it and even come across people that own residential and commercial property sometimes.", "replies": [], "depth": 1}, {"id": "ffcitux", "text": "Maybe focus on an emerging market where prices don't swing too much and there's not as much competition. I see things heating up around all the big rezonings, I've been called a few times on a property of mine from guys who are in 1031 planning on sites they sold.", "replies": [], "depth": 1}, {"id": "ffck40e", "text": "Get out of the cesspool that is Bill de Blasio\u2019s NYC", "replies": [{"id": "ffcskg1", "text": "This is the correct answer. Why do RE in a communist foothold? Capitalism still functions elsewhere...just don't bring your politics with you when you leave.", "replies": [{"id": "ffcviuz", "text": "The New York regulatory environment sucks, but...it's New York.", "replies": [], "depth": 3}, {"id": "fff0113", "text": "Communist? Go back to school, or to school. How about those yummy subsidies Wall Street got - that\u2019s not capitalism anymore that\u2019s govt handout to capitalism.", "replies": [{"id": "fffw4m6", "text": "I agree! I disavow government handouts in all forms. The US government is performing MANY functions that are not given to it under the US Constitution. ALL of those functions should be halted. Of course that will allow us to fire over 50% (maybe more!) of government employees; but that would be a great thing. They could then re-skill and learn how to do something useful. So YES, STOP all government handouts!", "replies": [{"id": "ffv45n0", "text": "&gt;The US government is performing MANY functions that are not given to it under the US Constitution.\n\nSo would you rather they just reorganize and put most functions(environmental, department of energy, dod, etc) all under the military since taxes and the military are both sanctioned by the Constitution?\n\n&gt;Of course that will allow us to fire over 50% (maybe more!) of government employees;\n\nI think you vastly underestimate the number of employees that could easily be contained within the military if they decided to reorganize.", "replies": [{"id": "ffyeh0q", "text": "I didnt say reorganize, I said fire. Most government employees are useless creatures. Fire them. I'm sure they will shocked at having to become productive, but they'll manage.", "replies": [{"id": "ffyf05o", "text": "&gt;I didnt say reorganize,\n\nNo you didnt, but the powers granted to the federal government under the Constitution and the subsequent amendments give it more than enough power to reorganize and continue with probably 70% of it's operations even it they just consolidated them under the \"military\". \n\nBut why think about it logically.", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "ffdt5do", "text": "This guy, AOC, and the idiots in Albany fucked NYC. All they needed to do was huddle together with big time RE shops to figure out the supply and demand problem that would reduce rents. Landlords increase rents because they can, because the population is growing faster than the supply of apartments. Work with LL\u2019s to increase the supply and you solve the issue without fucking everyone.", "replies": [], "depth": 2}], "depth": 1}, {"id": "ffcs7gq", "text": "Is this just in NYC?", "replies": [], "depth": 1}, {"id": "ffcswlr", "text": "So I will be 27 next month and was working in a mid market NYC brokerage - I straight up quit July 31. It\u2019s not worth it", "replies": [], "depth": 1}, {"id": "ffdlqya", "text": "real estate is cyclical no matter what.  just telling you from personal experience that shit will hit the fan in almost any industry eventually.  the ones that survive long term are the ones that succeed.  sometimes you have to stick it out. that being said, I've left a career on wall st and a great income to go full time into real estate at 28 and I'd have probably ended up successful either or.  \n\nmy advice to you is trust your gut.", "replies": [], "depth": 1}, {"id": "ffhgtnk", "text": "I\u2019m 26 at what sounds like a competitor of yours with both a sales and debt brokerage business. It\u2019s very easy to get discouraged in this role when not making money and if you can\u2019t pay your bills then yeah make a change. That being said, the city goes through pendulums of change every decade or so. It\u2019s happened several several times over. The principals of my company have told a story that when Lehman crashed (they worked at Massey Knakal), buyers walked away from millions of dollars worth of hard deposits. The weaker brokers quit their jobs the next day. Those that were able to weather the storm and persevere came out of the recession where in not too short a time they were the highest producing and most active teams in the city. Most are Massey alumni. \n\nI\u2019m on the debt side I\u2019m very very well aware of what\u2019s happening but if you truly like your work environment and the work itself then I\u2019d try and find a way to stick with it and like the comments said, find a way to focus on something different. \n\nEveryone and their mom knows about south BX that\u2019s like saying LIC is the new hot market in 2017 - too late bud. I like the Rockaways, i like NPLs, i like commercial assets, i like industrial. I\u2019d be happy to talk further if you want.", "replies": [], "depth": 1}]