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The Rich Rush To Offload Luxury Properties

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Ten years after feeling invincible, the tech industry suddenly faces something new. It’s a financial crisis. As bosses and workers adapted to similarly harsh realities, valuations declined, layoffs increased, startup funding seemed endless, and an air of horror began to permeate the sector.

In cities like San Francisco, New York, and Miami, luxury realtors are beginning to notice the impact of the tech downturn on their businesses as wealthy tech clients work on salary increases, bonuses, and job vacancies, telling motherboards. .. It doesn’t look as unavoidable as it was a few months ago.

“The elephant in the room these days is a recession,” said Curly Synths, a real estate agent focused on the blockchain at Sotheby’s International Realty in Miami.

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Nationwide Rising interest rates Mortgages are combined with record housing costs to determine the price of potential home buyers. But in the pockets of countries where tech workers tend to spend money on housing, interest rates are less of a concern than tech stock declines and constant barrage. Announcement of layoffAccording to the conversation the agent had with the client.

“It’s more than just interest rates because many people in New York City actually buy in cash,” said Manhattan real estate agent Mackenzie Ryan.

There are signs that the housing market may have peaked temporarily. Ask the price I’ve slipped a little, Homebuilder Starting work in fewer homes, and Mortgage demand Is the lowest since 2000.For now, home sales Most down Among the cheapest homes, buyers are more price-sensitive and are usually more affected by changes in interest rates. But a spokeswoman for real estate agent RedFin, which analyzes housing data, said markets like San Francisco were “certainly cold.”A recent RedFin analysis found sales of luxury homes Almost 18% decrease Compared to a 5.4% decrease in non-luxury homes in the three months to May. (RedFin defines “luxury” homes as homes with the top 5% of prices in a particular region.)

Ryan and colleagues found that they were particularly nervous among people in the tech sector, who make up a significant proportion of the top buyers in the New York and San Francisco regions, she said. They suddenly become less secure and feel more clever about bombarding luxury condominiums.

“Employment security is definitely approaching people,” Ryan said. “We are moving from a more optimistic market to a more conservative market.”

The decline in the value of cryptocurrencies only adds to the pain.

“Many New York buyers working in the tech industry are also investing in Web3,” Ryan said. “Modifications in these markets have resulted in a significant loss of wealth.”

Brent Logol, a New York agent, recently sold an apartment to a buyer who has made a large investment in tech stocks, but its value has dropped dramatically during the negotiation process.

“It really reduced her purchasing power, and we could only get so much,” Rogol said. “Because she was her only purchaser, we ended up reconciling with this person, and she couldn’t get any higher because of her portfolio.”

Rogol and his clients were nervous until the day the deal closed, that further market declines would kill purchases.

San Francisco agent Joanna Rose, who works primarily with sellers, said interest rates were a big issue for homebuyers across the country, but the “biggest thing” affecting the San Francisco market is the stock prices of tech companies. It is a decline. Homes over $ 4 million are bought in cash, and technical employees often liquidate the company’s stock to spend money on the home.

“Interest rates are part of that, but from my experience and what I’ve seen in San Francisco, we’re having a harder time figuring out the cash we’re used to paying for these assets,” Rose said. ..

The story of a potential recession only adds to the fear, and Rose is beginning to realize that it has recently started her business. “It’s pretty sudden,” she said.

She received only one call about the new $ 3.5 million condo in the luxury penthouse listed two weeks ago. Where 20 parties may have come to the open house before, Rose now wants to get five. She said she never had more lists available in July as fewer people were considering buying.

Rose had to talk repeatedly to help clients understand the new reality, and recently the asking price began to fall, with half of the active list lowering the asking price in the seven days before talking to the motherboard. I added. She has done two things herself in the last 48 hours, “she added. In addition, some homes are sold at a lower price than the list price.

“This doesn’t happen often in San Francisco,” Rose said. “In general, it’s the opposite.”

If prices were rising, Mr Rose said it was because home prices were deliberately set lower than market prices in hopes of causing a bidding war. She said her strategy was almost always effective, but now it isn’t. Other than the major properties, “the pendulum seems to be shifting to buyers,” agreed another San Francisco agent, Nick Chen.

In Miami, where there is an influx of tech and crypto companies, Chynces said the business is getting hot rather than slowing down. But that’s because people are trying to sell their homes before things get worse, she said. Chynces, who claims she works primarily with “crypto whales,” said she was 100 million in the last two months as wealthy clients tried to offload assets before price cuts hit the region. She said she received a list of dollars worth.

Cryptographic traders tend to see real estate as an investment that is quickly flipped over, rather than a typical homebuyer, and many are concerned that this is their last chance to make a profit.

“Climate has changed,” said Danny Hertzberg, another luxury real estate agent in Miami. According to conversations with distributors in countries such as France, Italy, the United Kingdom and Argentina, Hertzberg claims to hold the highest sales record in the city’s history, saying that the housing market is international as well as the United States. He said it was slowing down.

The past few years have been rough for Hertzberg. Rising prices in the private and public markets have given people the feeling that everything is “going to the moon.”

“People really bought it completely with all their heart. If they loved it, they bought it and they wanted it, so they get it. I was paying for whatever I needed to do, and they were making it so passive and aggressive that it was irrelevant, “he said. “The valuation was irrelevant. There was no accidental funding, and people would pay premiums to get what they wanted.”

But the declining tech companies’ reputation is having a “significant” psychological impact on the high end of the market as people try to readjust to an unsafe reality, Hertzberg said. “There are fewer bidding wars,” he said. “Sellers are a little more flexible.”

Not everyone is so worried. Jamie Chung, for example, considers recent things to be more than anything else. “It’s just ignited here,” said Chan, a member of the National Association of Realtors in Naples, Florida. “I think people are taking a break. That’s what they usually do in the summer.”

According to Chan, the stock market has a particular impact on the thinking process of buyers in her area. She often sells “second, third, fourth, and fifth homes” to people. In such cases, they turn back when they have less opportunity to use it.

“It’s not necessary,” she said. “It’s more desire.”

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