Avoiding cities like the plague: COVID has young homebuyers rethinking best ‘location, location, location,’ real estate gurus say

By Brett Johnson
New Jersey | May 11, 2020 at 3:25 pm
From our print edition

Big-name real estate agents in New Jersey like Michelle Pais know what to expect when young professionals call looking for a home; in those interactions, you can usually trust the stock phrase … location, location, location.

And, just as often, it’s only one location: the region’s most metropolitan, most vibrant and hippest community. Usually, that means Manhattan.

But the truisms have never been less true.

During the rampage of COVID-19 through the packed quarters of the region’s largest cities, and especially during its devastation of the New York metropolitan area, Pais said everything is being flipped upside down. After flocking to urban communities for at least a decade, young people are calling real estate agents to buy homes where no agent ever expected they would.

Expecting the grass might be greener on the other side of the white picket fence, they’re asking for homes in the Garden State’s sleepy suburban areas.

“I would say more than 60% of buyers who have been recently inquiring about homes in (New Jersey’s) suburban areas are coming from New York, and mainly Manhattan,” Pais said. “You have all these millennial families with small children, parents in their early 30s, who were once happy in their three-story Manhattan townhouse in the center of it all … now wanting to migrate here.”

Pais, who deals mostly with the sales of high-value homes in the northern New Jersey market as CEO of Signature Realty NJ,  said the fact that suburban communities such as Morris and Warren counties haven’t been as impacted by COVID-19 as some of its more dense neighbors in the region has been noticed.

Fred Berlinsky of Markeim Chalmers.

Fred Berlinsky of the South Jersey-focused real estate firm Markeim Chalmers expects that will, to some extent, also draw people to more southern reaches of the state that have been similarly less hard-hit.

“In general, I think you’re going to see millennials rethinking living in urban areas where people are packed in like sardines,” he said. “I don’t think it will be a massive flight, but there will be a sea-change.”

For better or worse, state figures tracking the number of confirmed COVID-19 cases in particular communities have also served as a signpost for homebuyers who are perhaps fearful of the amount of cases that have surfaced in their own community.

More than that, Pais said the millennial homebuyer who may have eschewed larger living arrangements may now be attracted to traditional suburban home floor plans that provide more separation between those in a household, given health officials’ recommendations for those infected to self-quarantine.

Additionally, the need to work remotely as non-essential workers during the state’s stay-at-home order has increased all homebuyers’ interest in having a dedicated office space, Pais said.

“People are also now looking for outdoor spaces,” she said. “I think being at home (while practicing social distancing), especially in apartments or condos with limited outdoor areas, has drawn people to having more land and backyards — which millennials haven’t prioritized.”

Eugene T. Paolino of Genova Burns.

With no crystal ball to provide the answers, Pais said there’s no knowing how long-lasting this new trend in homebuying will be, or if it will continue after a theoretical end to the rampant spread of the novel coronavirus.

These might be uncertain times, but Eugene T. Paolino, a Genova Burns attorney who works with clients in the real estate sector, says he expects people to have good memories.

That’s why the real estate property buyers and developers that chase the bustle of a thriving residential community are already wondering if the dense urban areas hurt most by the pandemic are the best places to plan for future development.

“For all the advantages a city has … is that what people want today?” Paolino said. “I’m seeing younger people dispersing into the suburbs and even living with parents, because density is a problem in a pandemic. And, I think a good portion of the younger people who once flooded cities are going to be saying, ‘Why would I expose myself or my young family to this kind of plague?’”

Dan Caldwell of Stout & Caldwell.

At the same time, Dan Caldwell, a partner at Stout & Caldwell Engineers & Surveyors, believes millennials, and young renters in particular, could be assuaged in the long-term by the measures some building owners and rental developers in cities will take to upgrade air conditioning systems and make buildings more resilient during pandemics.

Caldwell cautioned that it’s possibly too early to say what direction those looking for a place to live will end up going, especially when not every suburban town is going to end up being a healthy alternative.

“If you look at suburban communities such as Lakewood and the high number of cases there — and it’s hard to say a town is going to be any less susceptible,” he said. “Whether it’s in an urban area or the suburbs, as long as people don’t have a constant eye on the possibility of spreading disease, people are going to be affected.”

Read more from ROI-NJ on coronavirus: