Housing rush: In-person school adds fire to rapidly heating market

College students, office workers had already lifted rental demand in NYC

New York /
Jun.June 17, 2021 07:00 AM
(Getty)

(Getty)

Stephanie Hatzakos knew in May she’d need a place in the city come September.

A single-mom-by-choice to twin boys, Hatzakos had bounced around throughout the pandemic. Wintering in Florida when Covid hit, she sublet in Cobble Hill last summer, then moved to Greece for the fall, before landing in the Hudson Valley last month to check up on the bed and breakfast she runs.

Her New York layover had a second objective — to find an apartment while rents were still discounted. Her twins’ Cobble Hill preschool would be in-person and she wanted to snag a sublet before jetting back to Greece for the next three months.

“I felt like there would be more deals before the summer started,” Hatzakos said. “If I waited until August or September, that’s when everybody else would be looking for something. That’s when everybody would be vaccinated and it would be even more expensive.”

Turns out, the market in May was already heating up with an influx of tenants like herself.

Last month, Mayor Bill de Blasio announced that public schools would be entirely in-person this fall. That added a new cohort to the students and professionals scrambling to sign cheap leases in a rebounding rental market: families who had left town during remote learning but now needed housing near their kids’ school.

“I’ve had calls from people who were on the fence,” Compass broker Pamela D’Arc said during the week of the mayor’s announcement. “They’ve solidified their decision to come back now that their child will be in school.”

D’Arc said some families that purchased homes outside the city last year are looking to sell, then buy again in New York. But just as many want to cash in on the seller’s market and snag a city rental for the next year.

Bidding wars have ensued.

Douglas Elliman broker Bruce Ehrmann said he showed a $6,000 Chelsea rental — a space fit for a small family — 20 times in two days last week. Four offers came in, so his firm is asking each party to make a best-and-final bid. He expects the unit to lease far above its asking price.

“The [rental] market has changed so radically in so short a time that clearly some proportion of that change is due to children needing to go in person to school in the fall in New York City,” said Ehrmann. “There can be no question that’s part of the equation.”

Brooklyn has drawn families looking for space and greenery since the outset of the pandemic. Now, brokers say certain neighborhoods have grown especially attractive to families who want their kids to walk to school.

Brooklyn Heights, Park Slope and Williamsburg, each with at least one highly regarded school, have all seen a spike in interest.

Normally, New York sees a push for housing in July in expectation of the school year, said Erhmann. The surge for rentals and leases in early June shows new catalysts driving demand — de Blasio’s announcement as well as the call back to office work.

A Partnership for New York City survey found 62 percent of office employees are expected back to work by September.

Another factor driving demand could be renters who know they will be back in the city eventually and are trying to snag a place before prices rise dramatically.gm

“Families, younger renters, students are returning in pretty significant size and also pretty quickly,” said Sean Mitchell, CEO of rental tech company Rezi. “I think some of that is because they see the market turning.”

Hatzakos has her fingers crossed she isn’t priced out. Looking in May she found rents were already “obscene.” She managed to sign a lease on a sublet, but the other party pulled out at the last minute.

Now she is hunting online from overseas, but says it has been difficult. Most places are studios with no outside space for her kids to play.

“I come across back yards and decent apartments here and there,” said Hatzakos. “But they’re like $5,000, which is totally out of my price range.”





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