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- [00:00]
Michael Boudreau
This is a Cherish podcast and I'm your host, Michael Boudreau. I'll be taking you for an inside look behind the glamorous facade of the interior design industry. At a time when every aspect of the business, from sourcing to trends to marketing to dealing with clients, is undergoing rapid change. Real estate and interior design are inextricably linked. When home and apartment sales slow down, the whole design market ultimately feels the effects. Everything from interior designers to furnishings to big box home improvement centers. And in the face of high mortgage rates, lack of inventory and sky high prices and rents, the market has certainly been moribund. But is that about to change? Mortgage rates are already starting to come down. Will the reduction in the prime interest rate that the Fed has been dangling all year finally happen this month? Will that push mortgage rates down further? And will that be enough to activate the stagnant market? Or is there so much pent up demand the prices for homes will skyrocket? Is there any hope for the country's chronic housing shortage? And what about rents? And when people go on the hunt for new homes, what exactly are they looking for? I have three experts with me today who have insider insights on the markets in New York, Louisiana and across the country. First up is Leslie Singer, a broker who heads her own team at Brown Harris Stevens, one of New York City's preeminent real estate firms. Leslie earned her MBA at NYU Stern School of Business and is a lifelong resident of the city. She has received numerous awards and has represented buyers and sellers in literally hundreds of transactions. Welcome, Leslie. Hello.
- [01:55]
Leslie Singer
Thank you for having me.
- [01:57]
Michael Boudreau
So glad you're here. From Los Angeles, we have Rochelle Atlas Mays, an agent at Normand and Associates, where she serves as executive director of the Luxury Estates division, handling billions of dollars in sales. She began her career as a commodity broker and investment advisor before following her passion for real estate and design, ending up on virtually Every list of LA's top real estate talents. Hello, Rochelle.
- [02:22]
Rochelle Atlas Mays
How you doing there? Thanks for having me today.
- [02:25]
Michael Boudreau
So glad you're here. And finally, we have one of the Cherish podcast's most popular guests back for a third time, Amanda Pendleton. As Zillow's home trends expert, Amanda has a firm grasp of national trends. Everything from where people are moving to what they're looking for in their homes. Welcome back, Amanda.
- [02:44]
Amanda Pendleton
Oh, it's so great to be here. I love that intro. Thank you, Michael.
- [02:48]
Michael Boudreau
You're very welcome. So, Leslie, I wanna start with you. I want to get a sense from you about, in general, the New York High End real estate market. I've heard and it seems from retail sales and Home Depot and all that things have slowed down considerably. Has that been your experience or is it a little different on the high end?
- [03:06]
Leslie Singer
The high end luxury market has been fairly strong actually for the last year and a half.
- [03:12]
Michael Boudreau
Really? I didn't know that.
- [03:14]
Leslie Singer
Even in especially new development, we had a sale for 135 million just recently. Another sale for 117 million recently. Two weeks ago, the Amman closed a deal at 64 million. It was up 22% from closing just months prior. It was flipped $81 million sale at 220 Central Park South. So yes, our market's very strong high end luxury, especially new development. Where we have weakness is the larger cooperative market where things need to be renovated. That might be the softer part.
- [03:55]
Michael Boudreau
Yeah, it seems a trend all across the country that people don't want to do renovations, they want move in Rochelle. Is that the case in LA as well in terms of the high end market?
- [04:07]
Rochelle Atlas Mays
Absolutely. The high end, I mean what we consider here, 10 million and up. And then you have ultra high end which is 20 million and up has been very strong. And first half of 2024, I think we're up 4% from 2023. So we are showing some very good gains. And to answer your question, on what people are looking for, yes, everyone wants kind of that done property. They don't want to wait to redo. I think part of that too is because the buyer's a little younger and they're a little bit more used to the instant gratification factor.
- [04:43]
Michael Boudreau
They see it on Instagram, they want it. Right, exactly.
- [04:46]
Rochelle Atlas Mays
I mean they're used to having everything instantaneously, buying things through apps, having things done for them. So for a younger buyer to walk into a property and see that it needs, even if it's a light fixer, to see that it needs to be renovated, they can't wrap their head around it, nor do they want a way to do that if they have the financial means not to have to do it. But then they'd rather have something done for them. So that's why there is, I think a shortage because of the completely done properties.
- [05:17]
Michael Boudreau
Now Amanda, I want to ask you in terms of national things and I want to talk about a neighborhood of less than 10 million because that's a neighborhood I'm much more familiar with, believe me personally, way less than 10 million. So what is happening? Because we keep hearing that because the rates are high. And listen, apparently 63% of the sales in Manhattan in the last year have been all cash because people don't want to deal with a mortgage. But if you have to take a mortgage out, people could be paying $1,000 more a month than they would have been two months ago. And that's a big chunk of change for a lot of people. So what do you see happening? And the mortgage rates did go down a little bit in the last few weeks. And with the promise of the Fed promise that we've been hearing about for over a year, what do you think's gonna happen?
- [06:00]
Amanda Pendleton
You're right. Mortgage rates have dropped significantly over the past few weeks. That does improve affordability for home buyers. But Zillow's economists believe that the expectation that the Fed to drop rates is already kind of baked into today's lower rates. That said, we think that we could continue to see rates fall a little bit closer to 6% in the coming weeks. That could of course, prompt more buyers to restart their hunt for a home. That could reignite competition, that could boost sales as we head into the fall and maybe at the very least delay this usual post summer cooldown that we typically see. But I do wanna say, keep in mind, prices are still really high. That's still a huge barrier to entry for a lot of first time buyers. And buyers are reading the headlines that we're reading, that rates are gonna continue to come down. So they're thinking, yeah, 6.5% mortgage rates are better, but maybe I'm gonna wait this out a little bit longer and see if rates fall even more.
- [07:02]
Michael Boudreau
So my neighbor has three and a half percent. Why do I have to pay six and a half percent?
- [07:07]
Amanda Pendleton
Exactly. Yeah. And I think there's a lot of recessionary fears and talk about that. So I think a lot of buyers are saying, yeah, we're ready to go, but maybe I can hold out six more weeks, you know, a couple more months and just see what happens. We know there is this pent up demand for homes, and that's just because of generational factors. This huge population of millennials, every single year they're aging and they're aging into their mid-30s. They wanna settle down, they wanna buy a home, but is keeping them on the sidelines. So if that improves even marginally, even a 1% drop in mortgage rates, that should help tip the scales for some buyers, open up the door to homeownership for people who are maybe right on the edge of being able to qualify for a mortgage right now.
- [07:56]
Michael Boudreau
But then I've heard a real estate agent that I know say, what he tells his clients is that if you find a place that you like, buy it now, if you can afford it, and then refinance. Because once the rates go down, if they pray God, they go back down to 4% or something, there'll be a flood of people onto the market and you won't be able to get the home that you wanted. Do you think that's true, Leslie? Do you encounter that we say date.
- [08:18]
Leslie Singer
The rate, buy, marry the apartment.
- [08:21]
Michael Boudreau
Oh, okay. That's. I've never heard that. That's great. And Rochelle, what about you in la.
- [08:27]
Rochelle Atlas Mays
I'm a big advocate. I have a different opinion on kind of rates and all that, but.
- [08:31]
Michael Boudreau
Well, let's hear it.
- [08:32]
Rochelle Atlas Mays
Well, basically you have the Fed saying, beginning of this year, you're going to have the rates go down three times this year. Forever. We never saw it.
- [08:39]
Michael Boudreau
Right, Exactly. It's so frustrating.
- [08:41]
Rochelle Atlas Mays
So nobody knows what's going to happen? Honestly, everyone has their opinion. Nobody knows. And so everyone thought, okay, they're going down, they didn't do anything. I kind of look at the market as it is what it is. Yes, we've moved down and yes, get in now because you can refi later. What is going. We do know if they do go down, you're going to have a flood of buyers and you're going to have the 30 offers for that property that you're competing against and fighting for. And it's much harder to try and capture. I would rather put my clients and try and go all in now, afford what you can and then refinance it because you have a much better shot at getting a better house when your rates go down. You're also then competing against the all cash buyer because they're going to come in too and win the deal because they can close it quick. So I'm more on the thought process of trying to get in now and refi later.
- [09:35]
Michael Boudreau
Okay. And Leslie, what about foreign buyers? For years there were so many foreign buyers buying in New York and LA as well. Rochelle, and now China. Those potential buyers are gone. Are you seeing more foreign buyers now? Less. How does that affect the market?
- [09:51]
Leslie Singer
Maybe more post Covid, if you will, than we did. Certainly not the plethora of years before, but I would say more foreign buyers over the last couple years.
- [10:05]
Michael Boudreau
Same in la.
- [10:06]
Rochelle Atlas Mays
Same in Beverly Hills too.
- [10:08]
Michael Boudreau
Interesting. But one thing I wanted to ask you about, Rochelle, is the mansion tax in la, which is relatively new. There is one in New York, is my understanding, Leslie?
- [10:18]
Rochelle Atlas Mays
Oh, yes, absolutely.
- [10:20]
Michael Boudreau
So, Rochelle, how has that fairly new mansion tax has that had a detrimental effect on the market.
- [10:26]
Rochelle Atlas Mays
Absolutely it has. And I think people were kind of asleep at the switch, so to speak. No one thought this was going to happen. We wake up and it happened and it's been really an eye opener. What has changed is we've had a shortage of inventory and now we have even more of a shortage because people don't want the 5 million and over don't want to pay that tax.
- [10:50]
Michael Boudreau
What is the tax exactly?
- [10:52]
Rochelle Atlas Mays
It's a 1% at 5 million and another it's different percent at over 10 million. It's substantial though. And so what you are seeing is a flooding of inventory on the lease market which has gone up dramatically because people are trying to turn their properties into a 1031 exchange. So they lease it out for two years and then they won't have to have that tax and it then continues as an investment property or a 1031 exchange. So lease prices have gone down probably at least 15% here. The inventory is up probably 30% on the lease side. And what you have seen is specific just to Beverly Hills that become even more sacred. The 90210 zip code because it's more bulletproof. There's no tax. It's this cushy blanket. Everyone wants to get in.
- [11:49]
Michael Boudreau
So the mansion tax does not apply in Beverly Hills, which is a separate town as opposed to la. I didn't know that. That's so interesting.
- [11:55]
Rochelle Atlas Mays
Correct.
- [11:56]
Michael Boudreau
And Leslie, does the mansion tax work sort of the same in New York? Is it the same percentages?
- [12:00]
Leslie Singer
It's different percentages. We're graduated mansion tax as well. But ours is incrementally more from 1 million, 3 million, et cetera.
- [12:11]
Michael Boudreau
Because 1 million is not a mansion in Manhattan, I can tell you, or Brooklyn for that matter. It's hardly.
- [12:16]
Leslie Singer
But it's 1% of that sale.
- [12:18]
Michael Boudreau
I see. And. But that's been in effect for a while now.
- [12:20]
Leslie Singer
It has been. And the graduated was came more recently. Has not had such a negative impact as we had thought it would be.
- [12:30]
Michael Boudreau
Well, the good thing is people still want to live in New York or la, Beverly Hills. That's the advantage there. But Amanda, what about the rest of the country? Because there's always talk of the super rich. We should be taxing them more. How are we going to do that? The inequality that's such a problem and the lack of affordable housing. Are there other cities that have mansion tax or is this something that you think you're going to be seeing more of?
- [12:54]
Amanda Pendleton
The mansion tax is actually not something that Zillow has studied, and I'm not aware of other cities that are considering these types of measures. I think it would be really hard to sort of parse out the effect of a tax versus all the other major market factors that are driving the market today. I mean, we know the luxury housing market nationwide has been a little bit more competitive, and that's because inventory has just been slower to recover in the luxury market compared to the market at large. Luxury inventory nationwide is down 47% compared to pre pandemic levels.
- [13:30]
Michael Boudreau
Wow.
- [13:30]
Amanda Pendleton
Now Compare that to 33% for the rest of inventory, for total inventory. So you are seeing more competition in the luxury sector. We know that more affluent home buyers are less impacted by by these higher mortgage rates, able to pay cash, or perhaps they built so much equity in their current homes that it's not such a big hurdle for them to have to give up the lower rates and move. So I think there's a lot of factors at play. I don't doubt the tax is certainly one of those factors, but there are some major market movers that are probably having a bigger impact on the luxury.
- [14:05]
Michael Boudreau
Home market, and they're so amorphous because, like, as you were saying, Rochelle, how long have we been promised a reduction in rates? When are the baby boomers going to sell? Because that's one reason people are staying in houses that are much larger than they need to be in, because they don't want to move and buy a new place and pay a much higher interest rate. But meanwhile, they're stuck in these big houses. They love them, but they don't necessarily need them anymore, and it takes them off of the market. So I guess my question is, do we see any option for getting more properties on the market at every price level? What is going to help affect that change? I mean, lower rates, especially if they're substantially lower, I think would be a big help.
- [14:42]
Rochelle Atlas Mays
There is. I mean, but it's spotty in certain areas. It's kind of oversaturated, like the bird streets. That area was so hot. And every developer in town went there and has been trying. So you have a lot of inventory there. And then you have also Beverly Hills, you have Bel Air, all these different areas. And there's little nuances that go on in all these little suburbs. The permit process, all this. Everything has become so much more expensive for the developers since COVID every sub. And those costs haven't gone down. So I think we're up probably in cost to develop, probably 40%. I'm hearing from my clients and it makes it almost cost prohibitive. So you're not seeing so much new development in the real high end because the layer of gain and profitability has shrunk. So hopefully that will pan out and even out if you have rates going down and pricing going down. But it's just been a little bit difficult for my clients that are developers. They're all complaining about the costs and it's been a little bit problematic.
- [15:47]
Leslie Singer
Yeah, I was going to say the same, Rachelle, that Manhattan we do not see a lot in the pipeline in terms of new development. So you're going to see that high end luxury new development is going to get, the inventory is going to get tighter and tighter.
- [16:03]
Michael Boudreau
There are so many cranes all over the city. But I guess those projects were started from five years ago, right?
- [16:08]
Leslie Singer
Those were started years and years ago. So in the next couple of years you're just not going to see the same plethora that we've seen previously for the same exact reason, because costs are so it's prohibitive, the return on investment.
- [16:22]
Rochelle Atlas Mays
Just an example. This is kind of silly, but just the very good example of on the developer side, in houses here, luxury, we all have swimming pools. Pre Covid or during COVID a pool was maybe 30,000. They're now over 120,000 just for the.
- [16:37]
Michael Boudreau
Same pool to put in a pool.
- [16:39]
Rochelle Atlas Mays
Yeah.
- [16:40]
Michael Boudreau
Yeah, it's crazy.
- [16:41]
Rochelle Atlas Mays
Yeah, it is crazy.
- [16:43]
Ana Brockway
Hi everybody and thanks for joining us on the Cherish podcast. I'm Ana Brockway, the co founder and president of Cherish. I'm really excited to let you know that we've just added a major new feature on Cherish. It's called Cherish messaging and it lets you communicate directly and privately with our sellers. If you have a question on an item, need a specific measurement, want to ask about a seller's price flexibility? You can now speak discreetly and directly to our dealers through Cherish. Shoppers and particularly the trade have been asking for this feature and we've listened and delivered it. So please come on over and give it a try. Now back to the show.
- [17:28]
Michael Boudreau
So, Amanda, in light of those expenses, which it's nationwide, that's not just LA or New York, is there any hope for affordable housing? I mean, I know the last time we talked about Austin was this really super hot destination. Now I've read that prices are coming down a little in Austin because of various factors and tech and all that. So is there any hope for affordable housing in the United States? I know that's a big question. I don't Mean to put you on.
- [17:53]
Amanda Pendleton
The spot, yes, but I think the answer is increasing housing stock. Right? Increasing housing inventory. I mean, this is a supply and demand issue at its core. There's just more people who want to be in a home than the homes that are available. I think the good news is that home construction nationwide, maybe not LA or New York, it really took off during the pandemic. Last year, 1.45 million new homes were completed. That's more than any other year since the Great Recession. And that's been really helpful. Right. Especially over the past couple of years when so many existing homeowners are holding on to their ultra low rates and they don't want to move and they don't want to sell. Yet even as new construction sort of hit those highs, the housing shortage still increased. The nation's housing deficit is now at 4.5 million. That's how many more homes we need for every everybody who wants one. So even as builders are going gangbusters, we're still.
- [18:53]
Michael Boudreau
They can't keep up.
- [18:54]
Amanda Pendleton
Exactly. We're still climbing deeper and deeper into this hole because the nation's family count has increased. It's that huge generation of millennials, right? There's so many of them. And this decade of under building that followed the Great Recession, we're still trying to climb out of that. The other issue, I think, with a lot of the new construction is that it's happening in areas where it's easier to build. So Texas, in particular, parts of Florida, they've been able to keep up with the demand for housing because they've got a lot more land, right? They've got more favorable zoning laws that allows for more new residential construction. And so as a result, I think home prices there have been kept in check because supply has kept up with demand. Now, the worst housing shortages, maybe unsurprisingly, are found in the really unaffordable coastal metro areas. Places like LA and New York and Boston and San Francisco and Seattle. Right. Geographic constraints and costs play a huge part in why new construction's not happening there. But these also happen to be markets that have the most strict building regulations in the country. So if these cities want to increase affordable housing, they can loosen zoning regulations, they can add density, and they can help manage their affordability crisis.
- [20:11]
Michael Boudreau
Easier said than done.
- [20:13]
Rochelle Atlas Mays
LA has everyone else has a huge homeless problem and they really do need to do something about that and the affordable housing, especially since we're going to be hosting the Olympics in four years and they're going to really need to do Something to clean up the act here. But it is a problem. I've seen a lot too more in the outskirts like Palm Springs and those areas of the prefab housing going in and doing developments. I think that's a brilliant idea, these box houses or something to be able to help people. So I think that could be something that will be blowing up a little bit more because it's a little bit easier to develop and put to market.
- [20:49]
Michael Boudreau
Yeah. And we keep hearing about, you know, prefab, even 3D model housing, all these ideas. But you know, if you're on the street looking for a house, they don't seem to be reality yet. And it can be very frustrating. And I mean, and God knows, Leslie, I'm sure you'll agree, we have a terrible homeless problem in New York City as well. I mean, across the country there's a shortage of housing. And I guess we just all have to be aware of it and do what we can. But the zoning laws can be very difficult for new construction. You know, I know California's tried changed laws like around San Francisco, high density where trains are, they've increased the density where there's transportation, all that. But it's not easy. The NIMBY movement is still strong in a lot of places. So it's going to be interesting to see how we handle that because I think we're reaching a point of view. Something's gotta give here. And I wanted to ask about rentals because you mentioned Rochelle, which I didn't know that rentals, properties at all price points. We're not talking about subsidized housing or low income housing, but that there are more rentals on the market. Leslie, do you think that's true in New York? Because I read that there's hardly anything for rent in New York.
- [21:55]
Leslie Singer
Yeah, the rental market's still incredibly tight. And I also think of when we're talking luxury rentals, it's even tighter. So those who were not buying are renting. And I think also post pandemic, those that are in, have flex schedules, are renting because right now they're not quite sure where they're going to end up actually what is going to be their permanent residence. So we have a lot of people still renting. And that luxury rental market is very, very strong.
- [22:27]
Rochelle Atlas Mays
I did way more rentals last year than sales. I've never in my life had a year like that. And it kind of continues very much in that direct. It's really blown up here and there's just a huge inventory. And in Malibu too. We've seen a lot of it change in Malibu.
- [22:42]
Michael Boudreau
Interesting. And Amanda, what about across the country trends in terms of rentals? Because, I mean, the rent's too damn high. We know that. And they certainly, you know, for that brief period of the pandemic in New York, they fell for a little bit and people signed up and got these great deals and then now they've skyrocketed. Is that true across the country? Yeah.
- [23:00]
Amanda Pendleton
What we're seeing nationally, and Zillow Rentals is sort of the largest rentals marketplace in the country, so we have a pretty good pulse about what's happening in the. We are seeing a friendlier market nationally for renters. Rents are still growing by 5% a year. And I know that doesn't sound great, but it really is a far cry from those steep rent hikes that we were seeing two, three years ago when rents were skyrocketing 22% annually. And the other good thing is that a third of all rentals now are offering concessions to get renters in the door. So they'll throw in a free month of rent or free parking, something like that. We have seen sort of this flood of new multifamily rental units hit the market following this post pandemic construction boom. To give you some perspective, more new multifamily units were completed in June, this past June than in any month since the 1970s. So we've got all these brand new rental buildings, plus kind of a slowing job market. We've got lower mortgage rates, so that could push more people out of rentals and into the for sale market. So, you know, we think that rents could continue to fall if current trends hold.
- [24:10]
Michael Boudreau
And I suppose they would fall a little bit more if more people were able to buy.
- [24:15]
Amanda Pendleton
A hundred percent. Yeah. And that's what's been putting so much pressure on the rental market, is these high mortgage rates are keeping a lot of people who would otherwise be moving into their first homes, they're keeping them in the rental market for longer.
- [24:29]
Michael Boudreau
So let's. I want to get to a slightly more fun aspect of this situation which is not exactly ideal, shall we say, when people do come to you, your clients specifically, high end, fairly wealthy people, we assume, what are they looking for? What are the things? I want you to weigh in on this too, or show what are they looking for. What are the amenities? What's the hot things they have to have? Is it a golf simulator in the building?
- [24:54]
Leslie Singer
That golf simulator? Absolutely. 100% is like one of the. And it's not Even just golf, like a sports simulator. It could be golf and all the other, but I feel like it's different. Ages and stages have different amenity requirements. I have a lot of clients who really want to have a restaurant within the building, be part of a community within the building. There are certain buildings that offer that. There are a handful of those. But then if you're at a different age and stage, you might want a really amenity, rich building that actually has programming for children. There's one wonderful building in Chelsea, the Cortland that offers everything from like STEM classes and doing 3D computer modeling, cooking classes, and they have little dress up stations. Dress up kind of like a stage, if you will. So different ages and stages. My clients are going to be gravitating towards different amenities. And to this day that beautiful gym, that pool, gorgeous lounge, those still tend to be desirable. And then we have now the music room has become a very big hotspot for amenities. So if you want to jam as adults or you need your child to practice the drums downstairs.
- [26:17]
Michael Boudreau
So that would be for the building, a music room for the building?
- [26:20]
Leslie Singer
For the building, yes. Not for. Yes.
- [26:22]
Michael Boudreau
And in their individual apartments or whatever. For a while we heard home offices, everybody have a home office during pandemic. Is that still the case or are there other things they want?
- [26:32]
Leslie Singer
It's really a flex space. I think whether it be that home office or just to have a flex space is definitely desirable. There are more and more, whether it's the demand on the consumer. Developers are doing kind of prep kitchens so that your kitchen looks neat and beautiful.
- [26:52]
Rochelle Atlas Mays
Right.
- [26:53]
Michael Boudreau
Show off your hundred thousand dollars appliances and with no grease spots.
- [26:57]
Leslie Singer
So like no mess here, you know, especially with the open kitchen concept. So there's always a twist.
- [27:03]
Michael Boudreau
And Rochelle, what about in la? I mean like our gift wrapping room, still popular. All the crazy things that we've heard about. What are your clients asking for?
- [27:11]
Rochelle Atlas Mays
So I mean there's like the ultra high end developers that are doing all the bells and whistles. There's some that have changed, but kind of your common tier amenities for the luxury, you have to have the state of the art gym, you have to have a wellness center. So that would be an infrared sauna, the red light sauna and the dry heat. We're also seeing more cold plunging inside. That's been brought in. That's kind of a newer amenity. It's funny, you said golf simulator. Those are in homes. I mean I've seen many homes that have the golf simulator rooms in their homes. There is A lot of homes that have like in the 20 million to 25 million range, they'll have the outdoor pool and an indoor pool. So you have the ability to do both. Have to have the movie theater, the bar entertaining area. There's been some that are very specific. I've seen a few that had even home surgery centers. So you could have. It's crazy, but you could have the.
- [28:14]
Michael Boudreau
A little nip and tuck.
- [28:15]
Rochelle Atlas Mays
Yeah, exactly. It's prep for a celebrity. Someone very high end would not have to leave their home. The doctor could come in, they could do whatever procedure it is. It's completely set up for that. Seen some of those. And gift wrapping slash craft rooms. The one trend that I've seen kind of changes. More of a crazy kids room. Like just fun playrooms. They're just going over the top because you're seeing more. I think probably since COVID you had more of the kids and that millennials, whatever the kids coming and doing play dates rather than going out and doing things. So they're building these very luxurious kids rooms with the ball pits, a kitchen. It's almost like a little Disneyland. Seeing some of those mini golf courses. Absolutely. I think the biggest changeover in the last year and a half is the dirty kitchen or the prep kitchen. And that's kind of become a very big standard that you have to have that for the entertaining. So it can be pocket doors, it's shut down and they can be prepping and then you're not ruining a beautiful kitchen and it's a showpiece. So that's huge. And then adus is the biggest other factor that has changed here because they're.
- [29:35]
Michael Boudreau
Accessory dwelling units and they were not legal.
- [29:38]
Rochelle Atlas Mays
And so since COVID they were legalized and people have really taken advantage and you're seeing more generational families together. So the mother in law is now on property in the ADU and she can babysit children. And so they become more like compounds.
- [29:56]
Michael Boudreau
And I think ADUs across the country is something that might help lessen the shortage because people can rent them out. I mean, I have a friend who built a house in LA and had built an ADU as part of it and they rented out and somebody was able to find a rental. And I think if there's more, that's going to be a big help. But it is kind of great to know that LA is still LA in terms of things that they.
- [30:18]
Amanda Pendleton
It is.
- [30:19]
Leslie Singer
We've seen it all the other amenity I've seen that's changed. And this is keeping up with the Times, I think it's kind of fascinating is new development helpers are creating a closet basically right outside your apartment that you can actually access from inside the apartment as well. So a concierge almost closet that they drop off your packages on your floor because packages have become.
- [30:46]
Michael Boudreau
Yes, everything shipped in from Amazon or whatever, you know.
- [30:49]
Leslie Singer
Exactly. And so therefore you have your own storage closet, if you will, right at your apartment and you can just access it.
- [30:56]
Michael Boudreau
And Amanda, I want to ask you, for those of us who really the cold plunge comes when we open our monthly bills, what do you think the average American is looking for? You know, for a while, I know in New York, I think it was true in a lot of cities, developers making apartments smaller, feeling that if they could offer enough amenities, lounge spaces, terraces, gyms, that people would be happy with smaller living spaces. And that was a way to maximize whatever. Is that still a popular trend across the country? What's happening in other cities? What are people looking for and desirous of?
- [31:29]
Amanda Pendleton
Yeah, look, I'll say for the rest of us, a big must have for today's buyers is really functional backyard space and fun. Right. Fun outdoor features. Zillow research finds that buyers are able to pay a little bit more in today's market, are going to pay even more for backyard luxuries. So the number one feature that was associated with the highest sale premiums was an outdoor TV. Homes that mention an outdoor TV. Yeah, their listing description, they sell for 3.1% more than similar homes that don't have one. And then of course, the outdoor shower, outdoor kitchen, pizza oven, a she shed, a bluestone patio. All these outdoor features can boost a home sale price.
- [32:18]
Michael Boudreau
Do you think that was a result of the pandemic that people realized they wanted to be more connected?
- [32:23]
Leslie Singer
Absolutely, absolutely.
- [32:24]
Amanda Pendleton
And I think it's one of the few pandemic holdovers, right. Because we have seen home offices, home gyms, they're maybe not quite as important. They're not must haves anymore. But the preference for functional outdoor space has only grown since the pandemic. I mean, when you think about it, we were all forced outside, right. We had to do all of our entertaining outside during COVID it changed the way we live. And people really started enjoying this more casual, laid back kind of entertaining that replaced the more formal dinner parties or dining out. And you know, Leslie and Rachelle know this best, but when you're buying a home, you're buying a lifestyle, right? And so when you think about, you know, an outdoor tv, an outdoor kitchen, a pizza oven, that really embodies this new lifestyle that people want post pandemic where a lot of their social life is centered around their home and specifically their yard.
- [33:18]
Rochelle Atlas Mays
I think to your point, to share also that since the pandemic here in luxury, the developers would build as much house as they could per lot. So what was your percentage? And now you're seeing more of a shift since that because people just loved their space to use more and leave more yard for pickleball courts, for different things that you're doing outside. So instead of doing the max on the pad, they're pulling back so you can have that indoor, outdoor. And that's a very big change. So thanks for bringing that up.
- [33:51]
Michael Boudreau
Very good. That's great. Yeah, that's great.
- [33:53]
Leslie Singer
And actually, even in Manhattan for developers, you're seeing a lot more of indoor, outdoor pool situations as well for new buildings.
- [34:02]
Michael Boudreau
And it seems, Leslie, that many more apartments with terrace spaces, they're designing them now, the new building. So there are many more terraces and either shared or private.
- [34:12]
Leslie Singer
Absolutely.
- [34:12]
Michael Boudreau
Yeah. It's fascinating. Okay, I have one final question. This has been so informative and enlightening. I want to ask each of you and maybe we'll start with you. Leslie. In the year ahead in real estate, what do you hope to see happen?
- [34:26]
Leslie Singer
Oh, what do I hope to see?
- [34:28]
Michael Boudreau
Yeah. Dream big.
- [34:30]
Leslie Singer
Not what do I think might happen. What do I hope exactly? For me, I keep thinking we are going into an election year. Obviously for us in Manhattan, that always means uncertainty. Doesn't matter what your political party is, people stay on the sidelines. So I really believe, and what I hope to see though is a loosening up. It may not be that in the next coming months. I think the next coming months can be wonderful buying opportunities. But I think you're going to see interest rates hopefully will be dropping as promised or as said. And that post election, in the months to come, I really hope to see a very strong market. Really, those that have been on the sidelines, watching, waiting for the uncertainty to settle, I think a really strong 2025.
- [35:23]
Michael Boudreau
Right. Rochelle, what about you?
- [35:25]
Rochelle Atlas Mays
I would say something similar. Whereas we do get a rate shift a little bit lower. Not dreaming, but just something that makes a little more sense and that there are more possible mortgage programs that make it more affordable so more people can jump in. And most importantly, those first time home buyers, they're having such a difficult time trying to place themselves and having to go further out in areas that they don't want to be. So to somehow have some different programs that could Be a little bit more affordable where you could have more people involved with that, with that rate decline. So that. And that will stabilize the market in general. It will help the high end as well and hopefully just bring a little bit healthier economy.
- [36:12]
Michael Boudreau
Because in the past we have had the government sort of help out first time buyers. I mean, after World War II, et cetera, there are programs. That's a very good point. There's no reason that we couldn't come up with some programs to actually help first time buyers or whatever.
- [36:26]
Rochelle Atlas Mays
Exactly. With some type of incentives or something.
- [36:29]
Michael Boudreau
Yeah, exactly. Working with the banks. The banks always make money, so let them do a little work here. Amanda, what about you? What do you hope across the country? I mean, I think we all want more supply.
- [36:40]
Amanda Pendleton
No, I hope that more people have an opportunity to get home. I mean, home should be available to everybody. It should be a right and not a privilege. Absolutely. But I also hope for a healthier housing market. And that doesn't mean a wild housing market like we saw at the beginning of the pandemic. That means sort of a slow and steady recovery where the balance of power is not so heavily favoring either sellers or buyers. We are in a neutral market right now for the first time all year, which means it's a balanced market. And if we can continue this sort of slow and steady housing market recovery, I think we're going to get to a place where we have a healthier market that's going to work for more people.
- [37:25]
Michael Boudreau
I think that's a brilliant point. That's a great note to end on. So thank you, Amanda. I really, as I said, this has been so informative and helpful. And so I want to thank my wonderful guests, Leslie Singer, Rochelle Atlas Mays and the wonderful Amanda Pendleton from Zillow. And thank everyone for listening to the Cherish Podcast. You've been listening to the Cherish, brought to you, of course, by Cherish, which was voted by the readers of USA Today as the best place to shop online for furniture and home decor. If you enjoyed this episode, please tell a friend or colleague. Or better yet, go to Apple Podcasts and leave us a review. We appreciate your help in spreading the word and we would love your ideas for future episodes. Please email us at podcasthome cherish. Com. The Cherish Podcast is produced by Mugs Buckley and engineered by Hangar Studios in New York. Until next time.