The powerful (and perhaps permanent) impact of the pandemic on Manhattan home services
NYC 2022 looks a lot different than it has in recent memory. Some things are starting to go back towards normal. New Yorkers are slowly getting back to their offices. Residents have mostly come back to their homes. Other effects of the pandemic are here to stay: those restaurant sidewalk sheds don’t look like they’re going anywhere. As a representative of homeowners and a direct service provider, we interface with home service companies from many industries. Our clients have asked us what we are seeing, and this blog sums up our observations.
Where have all the home service businesses gone?
The pandemic has forced many home maintenance, home improvement and handyman businesses to close, move out of New York or significantly raise prices. This is primarily due to:
A shortage of qualified laborers/employees.
Difficulty sourcing parts needed for repair.
Supply chain issues which have impacted new installations.
We have seen long-term players in the NY home care market close their businesses because retirement is a better option. We have seen others
re-establish themselves in markets outside of New York City where costs are lower, and the employee pool is larger. Plus, the overall cost of doing business has been impacted by new regulations, higher insurance costs and lost billable time due to increasingly bad Manhattan traffic.
All the above have made it harder to run a business in NYC.
Which home trade industries are most affected?
HVAC repair companies are having a particularly hard time sourcing parts for repair and installations of new units. They now typically have a 6 to 9-month delay for many parts and equipment. Elevator companies are seeing the same delays, along with specialty importers who supply materials and parts for repairs or installations. Again, lead times have gone from what was typically weeks to months.
All the trades, including plumbers, electricians, roofers, painters, and carpenters, are feeling a hit, since their employees now understand the real cost of commuting to NYC jobs. Many skilled contractors and tradesmen traded higher salaries for jobs closer to home and a better quality of life.
How does this affect the homeowner?
To deal with increased costs, vendors need to cut their overhead and raise customer prices. This means cutting employees (often laying off those with the most experience since they’re the most expensive), which limits their capacity to handle jobs. They have also reduced the cost and the levels of insurance. These reductions in coverage often come in the form of exclusions in their policies which allow for lower priced insurance. This might look good to the homeowner on the surface, but often means that the vendor doesn’t have the full coverage that a homeowner requires. We have had to scrutinize each policy to make sure these exclusions are not present to protect our clients.
Increased costs to operate in NYC have had a secondary impact on the vendor market. Many companies located outside of NYC are no longer willing to send teams into Manhattan to do work for homeowners. Because there are less vendors to choose from, this pushes up prices even more, limits accessibility of the private homeowner and extends the lead time for services. Top Hat, with over 165 properties under management, is able to entice many vendors to service our clients and at the same time ensure reasonable pricing.
The Top Hat Difference
Top Hat has incredibly high standards for our team and our partners. Fortunately, we have maintained a strong team of both in-house home renovation and maintenance experts, in addition to a network of carefully curated professionals, including architects, interior designers, plumbers, electricians, or contractors.
It is important to have realistic expectations of your vendors, so you are not disappointed. We hope this helps you better understand and navigate the current environment to get your job done right and at a reasonable price.
Gary Mindlin is co-founder and owner of Top Hat Home Services, a full-service property care and management company. Top Hat services homes in Manhattan and are known as experts in every aspect of building management, maintenance and repair, as well as renovation and construction supervision.