|$1M vs. $4M, Co-ops vs. Condos
We’re in a divided market. Depending on what location, price segment, or product you’re looking for, you may find yourself in a ‘buyers’, ‘sellers’ or ‘balanced’ market. Sellers still have leverage in the $2M and below segment, from $2-4M we are mostly in a balanced market, and buyers still have leverage in the $4M and up sector. The type of property you’re purchasing (condo vs co-op) factors significantly into the unit’s price. The average price for condos jumped during Q1 while co-ops slightly dropped. Having said that, overall the co-op market is still less volatile than that of condos.
Some factors to consider:
Read More »
Q1 2017 Market Report
The Manhattan real estate market continues to show signs of stabilization and recovery, with the lower price segments showing the most growth. Overall, the average sales price increased 6.27% from Q4 2016 to $2,163,893, while the median sales price increased 11.43% to $1,170,000. Looking at changes on a year-over-year basis to filter out seasonality, the average price has increased 2.12% and the median price remained relatively unchanged with a 0.01% increase. Properties took around 70 days to sell during the first quarter, versus 57 days in the same timeframe a year ago. Inventory is also at its highest since 2010.
For our full Q1 marker report click here: Read more by clicking here.
Some factors to consider:
Read More »
- INVENTORY ON THE RISE There were 6,483 condo and co-op units on the market in the first quarter of 2017, the highest since 2010. Of these, 39 percent were priced between $1 million and $3 million and 32 percent were priced above $3 million. Buyers have more options than they’ve had in years.
- PRICE CHOPS In February 38% of Manhattan and 26% of Brooklyn homes had a price reduction. These numbers are high, but not quite where they were during the September peak. While we are seeing a bounce back from a weaker 2016, the reductions are an indication of a more stabilized market. Those sellers that are chasing record breaking prices cannot compete with properly priced apartments, especially when buyers have so many options to choose from.
- NEW DEVELOPMENT Year-over-year, the average new development sales price rose 15% to $4,345,818, with the average price per foot rising 7% to $2,161. This shows that buyers are still willing to pay a premium for a brand new product that requires no renovations. More than a third of new development closings were south of 14th Street in the first quarter of 2017, and half were below 34th Street. Keep in mind that some of the apartments closing today went into contract 1-3 years ago.
- RENTAL MARKET Manhattan rents remained flat over the last month, with rents up only 0.8% year-over-year. Broken down by neighborhood, the West Village showed the highest year-over-year growth with rents rising 3.1%. Murray Hill rents performed the weakest, with a 2.4% drop since last year.
Reporting Shows Slowdown, Real-Time Data Illustrates Opposite
The stock market is at an all-time high, the rental market is the weakest it’s been in years, and Q1 2017 market reports will come out next week stating the market has softened. However, contract activity is up. The real estate market is sending mixed signals depending on what segment you are looking at.
Some factors to consider:
Read More »
- 2017 REBOUND CONTINUES Jan/Feb 2017 saw a 17.9% increase in contracts signed compared to Jan/Feb 2016. Contract activity is one of the best ways to measure what kind of market we’re currently in and 2017 is off to a noticeably more active start than last year. This is real-time data. That said, the major firms’ quarterly market reports coming out at the end of the month will show a lull in activity. It should be noted that these reports actually reflect what was happening six months ago, not today.
- LUXURY MARKET STRENGTHENS With all the talk of the luxury market being lifeless, last month saw the second best February on record for the luxury market ($4 million and above) with a total of 108 contracts signed. March is off to a similar start with 28 contracts signed in the first week.
- CHANGING SEASONS Year-over-year the median Manhattan rent is down. Concessions also hit an all time high to start 2017, with 31% of apartments receiving either free rent or offering to pay the broker fee. Seasonally, winter is the ideal season to have your renewal come up to get the best deal if you are a renter. For landlords, the concessions should be used to push your tenants into a more desirable lease term in the summer months. What happens over the next few months will indicate whether we’re really in a down rental market or if this was just a tough winter. We expect to see concessions start to disappear and rental prices bounce back, but only time will tell.
- BUYER BEWARE On March 1st StreetEasy rolled out their new ‘Premier Agent’ program and it has since received a lot of backlash from the brokerage community and has caused confusion amongst buyers. Any agent who pays a fee for this program will be assigned as the primary contact for another agent’s exclusive listing, regardless of an actual connection or knowledge on that specific property. This program has also inconvenienced sellers and their exclusive brokers, as they are no longer the gatekeepers for information about their properties — it is now in the hands of an unfamiliar agent. We are expecting StreetEasy to make some tweaks to the new program soon.
Increasing Activity Post-Election
The post-election dust has somewhat settled, and there has been an uptick in both the financial and real estate markets. Regardless of political views, a certain confidence has been restored to the market.
Some factors to consider:
Read More »
- A STABLE BUT ACTIVE MARKET The average sales price of Manhattan apartments remained steady, while the number of sales increased by 16% from the preceding month.
- A LUXURY REBOUND? The first week of February saw 34 contracts signed above $4M, which is more luxury contracts signed than the previous two weeks combined, and the most signed in the first week of February in over a decade.
- NEIGHBORHOOD – PRICEY vs VALUE In January, Greenwich Village came out on top with an average price per foot of $3,067 over 12 recorded condo sales. The best values were found in Yorkville, where the average price per foot was $1,253, over 15 recorded condo sales. The Yorkville neighborhood is expected to see prices increase with the recent opening of the Q subway line.
- MORTGAGE RATES STAY IN HOLDING PATTERN The average rate on 30-year fixed-rate mortgages in Freddie Mac’s survey was 4.19% during the week ending January 26, up 10 basis points from the previous week. January’s average was 4.15%, down from 4.20% in December.
- CONCESSIONS RISE, REACH NEW HIGHS In Manhattan, 31 percent of all new leases included some form of concession last month, nearly double what it was a year ago. In Brooklyn, 18 percent of leases had concessions, more than three times what it was last year.
An Unstable Year Leads To Market Normalization
Happy New Year!
After five straight years of price increases, buyers finally started to feel some relief (depending on their price segment) throughout a wild 2016. The luxury sales market ($5M+) and the entire rental markets softened, while the more value arena (less than $2M) remained strong. Nevertheless, there are several indicators which make us optimistic that 2017 will start with a strong Q1.
Our full Q4 2016 market report can be found here.
Some factors to consider:
- UNDERSTANDING THE NUMBERS Around this time last year we saw a surge of luxury new developments close. This temporarily & artificially inflated “average sales prices” by 25-30%, while in reality, market conditions were weakening. Now that the bulk of these new developments are closed and accounted for, we expect future market reports to more closely resemble the broader resale market. The general theme is that market dynamics have started swing more towards the buy side compared to last year.
- BUYERS GAINED MORE LEVERAGE Compared to this time last year, Manhattan has 15% more sales inventory, 12% less sales in contract, and it is taking 24% longer for units to sell. These statistics fit the narrative that buyers in 2016 gained more leverage than they have had in several years.
- CONCESSIONS MASKED A WEAK RENTAL MARKET Median rents have stayed steady even as the market has weakened. How is this possible? Landlords are offering more concessions (free months / no broker fees) to keep up their building’s value in the eyes of lenders and potential buyers.
- BIDDING WARS DISAPPEARED In early 2015 nearly 7 out of every 10 deals went into bidding wars and sold above ask. In comparison, less than 13% of apartments sold last quarter went for above the asking price.
- SELLERS BECAME MORE REALISTIC The average discount from asking price rose year-over-year, from 3% in 2015 to 5% in 2016. Sellers are more negotiable than they were a year ago and have become more cognizant of current market conditions.
Best wishes for a successful new year!Read More »
Traditionally, the real estate market slows down as the holiday season approaches. With uncertainty leading up to this year’s election, the market was more quiet than usual. This led to two market mentalities: Some feel that a “market correction” arrived months ago, while others are still waiting for a further shift to find a “steal” that is seldom seen in Manhattan.
Here are some factors to consider:
- THE TRUMP EFFECT With the ensuing political certainty after the election, something that we haven’t had for some time, there has been an immediate positive impact which has led to a busier market. However, there is still uncertainty as to how Trump’s policies will specifically affect the market, such as trade, immigration and taxes, creating some hesitant buyers and sellers
- DAYS ON MARKET IS UP The days of overpricing an apartment and receiving multiple above-ask bids are behind us. Apartments are sitting on the market longer than they were a year ago, and price reductions are becoming more prevalent. If you’re priced right, you sell, if you’re overly ambitious, you don’t.
- THE MOST ACTIVE SEGMENT The $500K-$2M range of the market has remained steady, staying active and continuing to perform strong. However, this segment is most sensitive to rising interest rates. The recent hike has led some buyers to feel urgency to purchase before rates go up further, while others have lost the enthusiasm to purchase.
- FINDING VALUE The higher the price point, the more of an opportunity for a discount. Buyers looking to exchange a smaller apartment for a larger unit have never had a more opportune time than now to trade up.
- RENTAL INVENTORY IS SKY HIGH The luxury rental construction boom over the past few years has saturated the market with a surplus of inventory, up 24% compared to last year. This, in addition to the recent rush of foreign investors who have purchased new development condos for the purpose of renting them out, has formed a perfect storm for concessions and price reductions in the rental market. 25% of Manhattan leases signed in November had some type of concession, reaching a six year high.
- FLAWS IN REPORTING The rental and ultra-luxury markets have softened. However, recent closings from New Development sales of units that signed into contract over a year ago are artificially boosting median and average prices in market reports. This has made it appear that prices are still rising.
- MORTGAGE ACCESSIBILITY The Trump administration has vowed to dismantle Dodd-Frank, making mortgages more accessible.
We hope you have a very happy holiday season and best wishes for a successful new year!Read More »
Purchasing your first home is a big decision and is one that, although frustrating at times, can be quite gratifying. Buying an apartment in New York is no exception. It is a rather unique process and is no easy task, especially when done on your own. There are so many steps and procedures to go through as well as listings to visit. Competition can be fierce in some neighborhoods and your dream home may be difficult to find.
To help you hurdle the obstacles of first time home buying, here are a few tips to get you started:
Ask yourself – does it make sense to just keep renting?
This an age-old question in our city. There are several factors at stake when deciding this, including how long you plan to stay in the neighborhood, if you’re going to need a larger apartment soon due to a growing family, or whether you may have to move for your job. Do the benefits outweigh the costs? If you need to sell in a few years will you be able to break even or possibly make a profit? These are all important questions to consider.
Find out what you can afford (and make sure to consider closing costs)
Most first time home buyers don’t purchase cash but have a mortgage, so it’s important to contact and talk to a loan officer as well as your accountant or financial advisor if you have either. A loan officer can assist you in determining your budget and they can also get you pre-approved for a mortgage for when you submit an offer to purchase. Make sure to take into consideration your closing costs as well as your monthly common charges and real estate taxes.
Condo or Co-op?
There are more co-ops than condominiums in New York and they are also generally cheaper to purchase. With co-ops you are purchasing shares of a corporation instead of purchasing the real property like in a condo. Sometimes it boils down to whether or not you can afford a condo but both have their perks and disadvantages. It’s best to talk to an agent to see where you stand.
Choose your neighborhood – be adventurous
Some buyers are very particular on what area or even what specific blocks or buildings they must live in. For others, they don’t really have a choice. You may not be able to live in your dream neighborhood due to price and availability, so it might be good to explore other parts of the city. You never know what you’ll find.
Pick a real estate agent…they know what they’re talking about
Real estate agents represent buyers day in and day out. They can take care of everything from soup to nuts – helping connect you with the top loan officers and attorneys, setting up listing appointments, making sure you get the best deal, and ensuring you collect all necessary paperwork required by the board of managers. Some specialize in certain price points and neighborhoods and some are more well-versed in co-ops than others. It’s best to find one that suits and understands your needs.
To renovate or not to renovate?
Putting in a new kitchen appliance or repainting walls may not be that big of a deal or expensive, but some apartments need A LOT of work. Renovating a unit can be time consuming and pricey, so it’s important to talk to a contractor and/or architect about renovation possibilities and costs. If you do decide to purchase an apartment in need of work, make sure to read over the building’s alteration agreement prior to signing your contract.
Check the building’s rental policy
A few years down the line you may decide you need a bigger unit or move out of New York. But you’d possibly rather not sell the home you have and rent it out instead. This city has one of the hottest rental markets in the world, so what better way to cash in then to find a qualified tenant to cover your monthly charges while the apartment’s value appreciates. Ask an agent what they think you’d be able to charge in rent.
Most importantly, you have to decide what means the most to you. Whether it’s size, location, condition of the apartment, or something else, you have to be happy in your new home. Purchasing an apartment is a serious investment and is not to be taken lightly.
We’d be happy to help you find a new home, with no obligation or cost to you. Feel free to email or call us at any time.Read More »
At some point many New Yorkers ask themselves, “Should I keep renting or is it time to purchase my first home?” It’s a question that stirs some internal debate and it’s a big decision to make. There are many factors that a first time home buyer needs to consider when deciding whether or not to keep renting.
Here’s a quick list of thoughts to keep in mind:
Don’t just think about the now, but think about where you’ll be 1 year, 5 years, or 10 years from today.
If you plan on moving out of the neighborhood or into a bigger apartment in a year or two, it probably does not make sense to purchase especially with all the closing costs involved with a purchase and sale. But if your intention is to live in the apartment for an extended period of time, it might be financially wise for you to buy instead.
Talk to a loan officer to see if you qualify for a loan and ask advice from your accountant or financial advisor (if you have either).
These are professionals and can help to point you in the right direction. They’ll assist you to determine whether or not you can afford a down payment as well as the monthly costs. Getting a mortgage pre-approval letter is also vital when submitting an offer to purchase.
Speak with a real estate agent about your potential options and where the market is heading.
Sales inventory in some areas of the city may be lacking and a real estate agent can help you find out what’s currently on the market. If you can’t find anything you truly like, it may be best to rent for now and keep searching. Agents can also help show you trends in specific neighborhoods.
Think about the neighborhood you can see yourself living in for some time.
If you’re considering buying an apartment, it’s important to have a sense of what area of the city you want to live in for the near future. If you think you might want to buy in a different area then where you currently live, it might be wise to rent in the new neighborhood for a while to see if it’s a good fit. Give some thought to what subway lines you might need to get to work, the proximity to friends and family, and even where you feel the most at home.
Renting versus buying is a serious discussion you not only have to have with yourself but it’s one that has to involve others as well. We’d be happy to help, so please feel free to give us a call or email us at any time.Read More »
Moving into a New York apartment can be a daunting task. Not only can the application and approval process be a drag, but you then have to worry about everything that must be done right before and after moving in.
Here are a few top tasks to consider and remember to streamline your move-in:
- Contact your new building or management company about move-in procedures. Every building is different in terms of paperwork, deposits, etc. when moving in. Some may require certificates of insurance or for others you may need to reserve the elevator. There might also be specific days and times when they allow move-ins. Make sure to get in touch to ensure you have everything settled prior to your lease start date.
- Get a moving truck and/or hire movers. You may want to move everything on your own, but getting professional help is something to consider if there are large pieces of furniture or stairs involved. The last thing you want to do is damage any of your belongings or the building you’re moving in or out of. Make sure to find a truck or moving company early on, especially if you’re moving on the last day or first day of the month.
- Call your cable provider to set up cable and internet. Get in contact before you move-in to set up a time shortly after your lease start date for them to come in and get everything hooked up. Appointments book up quick so it’s important to do this as early as possible so you’re not without cable and internet for an extended period of time.
- Set up your electricity account. Call Con Edison to let them know your move-in date. They will bill you monthly for electricity and gas. Rarely are these included in your rent, but make sure before signing your lease and moving in.
- Get renter’s insurance. This is sometimes required by your Landlord, but often times tenants ignore it. Renter’s insurance is generally inexpensive and is a great way to protect yourself against damage to your personal property.
- Try to take measurements of your new home as well as the building’s hallways. Moving furniture into a building can be challenging, so make sure whatever furniture you decide to bring in will fit not only in your apartment, but also through the hallways. The last thing you want is to try and move something in and it never make it inside of the building.
- Sign up for mail forwarding and change your address notifications. Contact the post office to have all of your mail forwarded from your old apartment to your new apartment. It can all be done online on the USPS website. Also make sure to change the address associated with your debit and credit cards.
- Find out how and where to send rent…and set reminders for yourself. Rent is generally paid via personal check mailed to your landlord or management company. Rarely are cash or credit cards accepted, but make sure you find out prior to your first due payment. Remembering to pay rent is easy to forget, so make sure to figure out a way to send it in on time each month to avoid those pesky late fees.
New York is arguably the most difficult city to move into, out of, and within, so be sure to get ahead of the game and start all of your tasks early. To discuss anything else you have questions about or for any other real estate needs, please call or email us at any time.Read More »
Renting an apartment in New York is arguably the most difficult out of any city in the country and possibly the world. Landlords can sometimes require a significant amount of paperwork, upfront deposits, and extensive background checks. The market is also competitive for renters as units are often snatched up the day they are listed. It can be quite the headache, so when you finally do find the home you’ve been searching for it’s important to make sure of a few things so that you feel comfortable in your new home.
Here are a few tips to follow as well as red flags to look out for when you’re on the hunt for an apartment:
- Keep in mind you may never find the “perfect” apartment. The apartments you see may not have all the bells and whistles you were hoping for and this often depends on your budget and the inventory available. You might have to make concessions on a few of your ‘must haves’. With competition the way it is, if you find a home that would work for you then give some serious thought about putting a deposit down right away.
- Check the water pressure and hot water. The water pressure in the building can say a lot about how well it’s maintained. It’s also important to turn on faucets to make sure the hot water works. If there is spotty to no hot water, chances are you’ll have issues with the heat in the winter months.
- Check your cell service in the apartment. Some providers don’t work well in certain buildings and apartments. If you use your cell phone a lot while at home you should check your reception while viewing the apartment.
- Don’t sign anything you don’t understand. Many landlords use the same type of lease with the same legal jargon. If you have questions about what something means, make sure to have your broker clarify it for you. You may even want to have an attorney review your lease prior to signing if something seems off to you.
- Never rent an apartment “sight unseen”. Always, always, always make sure to view an apartment before agreeing to rent it and signing a lease. Sometimes it may be difficult to see a unit as there might be limited access or you’re travelling for work. If anything get a trusted friend to go for you so they can help you to make a judgment call.
- Look for signs of water damage. Check the walls and ceilings for water marks or maybe even freshly plastered and painted areas. The last thing you want is for your ceiling or walls to start leaking while you live there.
- Bring a measuring tape. Often times the building will not have a floor plan or measurements of the rooms in the apartment. It might be a good idea to take down the sizes of rooms to be sure that whatever furniture you have will fit inside the apartment.
- Walk the building and assess its condition and cleanliness. If what you can see with the naked eye it is not well maintained, chances are everything behind the scenes probably is not as well. You don’t want to run into maintenance issues during your tenancy. Things happen, but a well kept building is a good sign.
We hope this helps. To discuss anything else you have questions about or for any other real estate needs, please call or email us at any time.Read More »