A: As generally predicted, Alan Greenspan's last meeting as chairman of the federal reserve ended in another 1/4 point rate hike. This brings the federal funds rate to 4.5%, the highest level in 5 years.
It looks as if Greenspan wants to keep an open platform for Ben Bernanke as he takes over the next fed chief position, by setting an environment ripe for another rate hike. I would estimate current consensus at about 50/50 right now on another rate hike next meeting. I will know more when I see the fed minutes that explains what 'mood' the fed is in and why.
If we do get 1 more rate hike at the next meeting, expect housing to stay cool (flat to down) for at least the remainder of 2006.
Alan Greenspan is arguably one of the most important figures in recent economic history, recognized consistently across the globe. His best moments became clear after-the-fact on how he handled a crisis. No one was better at handling the stressful pressures from both politics and the media that come from being the fed chief. He will be remembered as one of the best and will wind up being the highest paid consultant and public speaker since Bill Clinton.
All investors should at least keep an eye on new fed chief Bernanke for the first few meetings to see how he adapts, how he deals with the public on his thinking, and how he handles the next crisis (which very well may be housing).
~ Fed Raises Rates: Another Hike Possible
A: Curbed.com's recent post on a new marketing tactic used by a Citi-Habitats rental agent. I wonder who it was?
Curbed.com is my favorite NYC real estate blog hands down. So, as a Citi-Habitats Sales Agent, I found this post/pic especially interesting! While I'm not sure how many people are going to use a broker they found out about in the subway, I'm sure worse marketing techniques have been proven successful by real estate agents!
My one question is, which agent/manager did this and are you getting calls?
~ Trends in Real Estate Advertising
A: As I browse Inman News Blog, I noticed a new real estate search site has made it's debut; Real Estate Advisor. While I dont see what they are advising you on it does seem like a decent, but nothing special new addition to the online real estate search community. On a side note, Trulia.com has added New York & Brooklyn to their search site.
It seems Real Estate Advisor covers more territory than does Trulia or Streeteasy, but they seemed to copy Trulia's template of listing information. While I'm not a fan of copycats taking away from the originality of the first do'er, I don't see any new features on Realestateadvisor.com that would prompt me to use it over Trulia.com or Streeteasy.com.
In fact, I still think Streeteasy.com is the best NYC real estate search site because of the detailed data and links they offer to users; such as School Zones, Find Your Building, Most/Least Expensive, New Developments, & Condo Conversions. I hear that even more useful searching features are on the way. I'm hoping to get more details on this later.
Im sure its only a matter of time until Trulia.com, soon to be Zillow.com, and now Realestateadvisor.com copies Streeteasy and their useful searching features; but this agent will stay loyal to the original do'er. After all, its the only thing that separates me from the animals.
I would pass on Realestateadvisor.com and I see this web startup having trouble finding its footing unless they launch some kind of mass advertising campaign nationwide. And even that has its limits as it uses up so much capital.
Meanwhile, this online real estate world is getting awfully crowded. With Zillow.com coming soon this sector will be saturated. Where are users going to go to find a new home to buy? There will be like 5 choices. It will be interesting to see which websites make it and which ones whither away. Look for the one with the best content, most up to date listings, and the best system for displaying Open House searches to come out ahead when the dust settles!
On a side note, Trulia.com has added New York, Brooklyn & Rochester searches to their website. It appears they got the feeds to Corcoran, Bellmarc, Halstead, Elliman, & Brown Harris Stevens to start off. Not a bad group of brokerages!
A: With One Carnegie Hill, 215 East 96th Street, almost finished I see 14 listings currently for sale by those who purchased units last year during pre-contruction. As we get closer to occupancy, planned for Winter 2006, expect more units to be up for sale setting the stage for in-building competition amongst investors. However, this building is NOT entirely made up of sales units, as Related Companies will hold on to a portion of units for rental use.
The Related Companies new condop (A Co-op with Condo Rules/By-Laws) is part residential sales, part rentals with tons of amenities. While the location is right on the cusp of the "Do Not Cross 96th Street" mantra of Upper East Siders, and it is right next to a Mosque (a pretty nice one too), sellers are valuing units for sale here at aproximately $912-$1350/Per Square Foot.
Occupancy for this new building is expected during the Winter of 2006. Based on the description on file:
Over 16,000 Square Feet of ammenities including a private Swim and Health Club, Pet Spa, Aerobic and Yoga studio, Childrens Play Room, His & Her Locker Rooms with saunas and showers, Massage Room, Business center, and outdoor Garden Patio with private Barbecue Areas. Additionally, the roof top sun deck boasts Panoramic views and has an indoor Party Lounge. Kitchens feature luce de Luna granite, porcelain tile floors, stainless appliances and Waterworks fixtures. Bathrooms feature Botticino Marble tub surround, a honed Imperadore Floor, high gloss ebonized cabinet and kohler fixtures. The warm enveloping lobby is designed by Rockwell Group and the entrance is on 96th Street. It features Spanish ambarino pavers, Santos Rosewood Panelled Walls, and a copper leaf vaulted ceiling.
Of the more expensive units listed for sale are:
Size: 1,653 Sq. Ft.
Price Per Sq. Ft: $1,180
Marketed By: Carol Kelly of Corcoran
Size: 1,513 Sq. Ft.
Price Per Sq. Ft: $1,256
Marketed By: Carol Kelly of Corcoran
Size: 679 Sq. Ft.
Price Per Sq. Ft: $1,325
Marketed By: Carol Kelly of Corcoran
And finally, the 1 Unit in the building priced UNDER $1,000 per square foot:
Size: 883 Sq. Ft.
Price Per Sq. Ft: $912
Marketed By: Carol Kelly of Corcoran
Related is certainly one of the most popular developers in NYC and you can be assured that their buildings will be very luxurious with great amenities. However, with a cooling market and location that is suspect I'm not sure that these units are going to sell as fast or as high as investors' hoped. They should still make money on the deal, just not as much as they previously thought. Let's see what happens when deals are closed and the first units are flipped.
A: Developers in Vegas are 'scaling back' with their projects while developers in Miami are going from 'acquisition' mode to 'disposition' mode. The most highly speculative markets in housing are always the first to tumble; and tumble they shall! Expect developers to compete with each other via incentives and price cuts in what looks to be a bloody 2006 in some markets!
According to a recent TIME article, Vegas Condos Go Cold, several high level condo developers including the likes of companies backed by Michael Jordan, Ivana Trump, & George Cloony are either "folding or selling their holdings".
According to the article, John Restrepo, head of a Las Vegas real estate and economic consulting firm, says:
"It's another case of irrational exuberance...There is a market for high-rise condo hotels here; but it's not as deep as people thought it was. The days of the two guys from the East Coast or Canada coming into town and promoting a condo development with a website and a dream are over."
Another source, ENR.com, which recently published an article, "Las Vegas Condo Boom Cooling As Some Projects Cancelled", goes into a bit more detail about some developers and their plans; or lack thereof.
The same John Restropo as quoted above goes on to say:
"There are 60,000 condominium and 19,000 condo-hotel units currently proposed, planned or under construction in the Las Vegas Valley....But we anticipate that less than 25% of those units will actually be built in the next five years."
It's going to be interesting to see how some of these markets outside NYC, including Miami, Las Vegas, Los Angeles, Phoenix, etc. fare over the course of 2006. I'm leaning towards the "not so good" side! New York City is a bit different and should not be compared to these highly speculative markets. Remember that NYC is an island and is currently about 75% Co-op; Most Co-ops adhere to strict policies in approving a new shareholder leaving speculators to buy condo's and condop's.
~ Vegas Condos Go Cold
~ Las Vegas Condo Boom Cooling As Some Projects Are Cancelled
A: Wall street bonuses are yet to hit the high end as 30 Fifth Avenue is the next building in the 'High End Blues' franchise. Savvy buyers should keep their eyes open for value as these prices for prime location keep falling!
While its not 5th Avenue next to Central Park, its still prime location south of Union Square between 9th & 10th streets. It is widely recognized as one of the best prewar Gold Coast Village doorman buildings on 5th Avenue near 10th street. Building amenities include 24HR Doorman, spectacular roofdeck, laundry, with a bike room and storage in basement. Pets OK.
Latest word on the price reduction at 30 5th Avenue:
On the market since 4/18/2005
Reduced from $1.54M to 1.495M to 1.395M
Marketed By: Robert Schartoff of Warburg Realty
With 1,200 sq. ft. of livable space and a price per sq. ft. of $1,162, this apartment is diving closer to a good buying opportunity for those looking into this location.
For comparison, review this brand new 1BR apartment in the same building just put on the market 2 days ago:
On the market since 1/24/2006
Priced at $899K
Marketed By: Roseann Barber of Corcoran
While not listed, this 1BR is probably around 700 sq. ft. which would give it a price per sq. ft. of $1,284. Either this is overpriced (since its new the seller could be testing the market) or the reduced apartment for 1.395M all of a sudden looks like a value!
If your a first time buyer looking in NYC be sure to read my post on "How To Find Good Value in this Seller's Market", even though the market has shifted since the post was published to more of a buyers market, at least in terms of pricing pressure.
A: Existing Home Sales slide 5.7% in December to 6.6 million units annual rate, but set record for ALL of 2005.
Sales of existing homes set another record for the year of 2005 even though the year ended with 3 consecutive months of declines. As a lagging indicator of the US housing markets, this is just another sign that the red-hot housing market has been cooling. However this is the 5th consecutive year of setting an annual record of homes sold; could 2006 be the spoiler (I think so!)?
NAR reports that sales of previously owned homes and condiminiums dropped by 5.7% compared to the sales rate of November. Total sales for 2005 climbed to a record 7.072 million units, up 4.2% from 6.784 million units sold in 2004.
Even more reason why we need a BUYER CONFIDENCE INDEX to assess the state of buyers in local markets so that we can have a more real-time indicator of where housing is headed!
A: Reffering to an article yesterday in Matrix, a blog by Jonathan Miller, Wall Street bonuses this year totaled aproximately $21.5B!
This could be a factor in the months to come for many high end real estate agents who have been having trouble selling that $3M property. As prices come down savvy wall street traders, executives, and brokers will look to buy the high end apartment's that are being sold by distressed sellers. Just because they have tons of money doesn't mean they won't look for a bargain and submit low ball offers!
I will report on the high end market's recent activity in the next few weeks to see if there has been any pickup due to the incredible bonus season or continued price cuts to stimulate demand.
~ Wall Street Bonuses Equaled Afghanistan's GDP
~ Wall Street Bonuses Dwarf Some Countries' Economies
A: Open House activity is 'picking up' according to a sales manager at Citi-Habitats who oversees 2 offices of sales agents. On the macro side, the US Dollar continues its downward trends making NYC housing more attractive to foreign investors.
Open House Activity: According to Citi-Habitats Sales Manager Brian Legum:
"Open house activity has definitely increased over the past few weeks. My agents are reporting to me that those apartments with recent price reductions are seeing the most action (10-25 people) at their open houses. Its obvious that buyers have 'wisened up' since the inflated prices of 2005, and are showing up only as prices come down. Apartments priced in the $400k-$700k range have experienced the fastest pickup in buyer activity while the high end market is seeing only slightly better turnouts."
US Dollar Slides: The US Dollar Slides on risk aversion and higher oil prices; also contributing is the US's current account deficit and the bounce in the EURO. How does this affect NYC housing you ask? Well, it leads to an environment that is very investment friendly in terms of currency valuations to foreign investors. For example, as the EURO gains value against the US Dollar, housing prices in US dollars are cheaper for those who own Euros. And vice versa. Here is a chart from Yahoo Finance comparing the value of the US Dollar to the EURO over the past 1 year:
At this time last year 1 US Dollar bought you $0.76 Euros. The US dollar's weakness spurred a lot of European investors to buy in NYC. It was one of a few factors that led to a very active period for the first 4 months of 2005. While the dollar gained over the course of last year, it has started to dip again over the past 3 months. If it continues, we will get more pressure on the buy side from outside investors looking to cash in and buy US real estate when the dollar is cheap.
More pressure on the buy side from a weaker dollar, a cooling housing market with price reductions and desperate sellers, and a pickup in OH activity as of late could be the beginning formula for a short-term pickup in NYC housing markets. Keep your eyes open!
A: Just because you have an accepted offer, doesn't mean the apartment is now yours! In fact, the selling broker was probably given specific instructions to continue to show and market the apartment until a signed contract is received by their attorney. Read this post if your new to real estate and looking to buy a property without the assistance of an agent.
When an offer is accepted, both the seller's attorney and the sellers broker will begin to work on getting all necessary documents to the BUYER's attorney. Generally a 5-business day period is given to the buyer's attorney before a signed contract and 10% deposit is handed in. After all, there must be some time restriction as competition is greater in New York City when compared to other markets.
A rule of thumb for buyers:
GET A NEW YORK CITY BASED ATTORNEY BEFORE YOU SUBMIT ANY OFFER (ask a current nyc homeowner that you know for a refferal)
OK, so the transaction goes something like this: The asking price was $550K, you submitted an offer of $525K and it was accepted. Congratulations! Now enough celebrating and make sure your attorney is ready to review the documents; Contract of Sale, 2-Years Building Financials & Offering Plan. If your attorney DOES NOT receive these doc's from the seller's attorney within 3 business days, then I would put time pressure on the seller and threaten to retract your bid. There is no reason other than, 'going behind your back', for these documents to take longer than 3 business days to get into your attorney's office. This is not the suburbs and there is always the chance that someone else has submitted a higher or better offer.
Your attorney could take up to 5 business days to review and OK you to sign the contract and send in the deposit. As always, if you think you got a great deal, try to get these doc's signed in 2-3 days of receipt.
Unless the seller is out of town expect to have the signed contract COUNTERSIGNED within 1 business day, sometimes two. If its been longer than 3 business days since the seller receives your signed contract, then something is up. Ask your attorney to apply some time pressure to get that contract signed! Once the seller countersigns, you now have a FULLY EXECUTED CONTRACT OF SALE.
While the party is not over yet, it is much closer. The next 2 items that need to be completed is getting your loan committment letter from the lending bank and to complete the required board package. The seller broker will assist you in the preparation of these documents.
Q: If the seller broker will assist me in the transaction, why would I need a buyer broker?
A: The seller broker REPRESENTS the seller and has a fiduciary responsibility to the seller to get the highest and best price possible for the apartment. The buyer broker REPRESENTS the buyer and has a fiduciary responsibility to the buyer to get the best value possible for what meets your needs. There are also NO charges to you to use a buyer broker.
Good Luck and feel free to submit any questions to me if you get stuck anywhere during this process!
A: With the emergence of Streeteasy.com, a 2nd round of financing at Trulia.com, and the coming of the Rich Barton project titled Zillow.com, the online real estate landscape certainly is changing. Here's the lowdown.
According to the ABOUT page:
StreetEasy was born out of the frustration we experienced when we set out to buy an apartment in New York. Not only did we have to check multiple sites, but also we could never search by the things most important to us (like by school) or get information that was important to us (like the real deal on a condo or co-op board).
I think Streeteasy.com has the best search technology so far, although I'm only comparing it to Trulia.com as Zillow.com has yet to be launched. However, they really did their homework and seems that the site was designed truly from the minds of frustrated buyers who wanted a better resource to find sales listings in New York.
Search features offered include FIND YOUR BUILDING, MOST/LEAST EXPENSIVE, NEW DEVELOPMENTS, RECENT CONVERSIONS, SCHOOL ZONES, A BLOG, MOST ACTIVE LISTINGS, & STREET FACTS. A comprehensive suite of data laid out in a very user-friendly manner! Search technology is pretty good too.
Here are the results of a search for 1BR condos in the Upper East Side around $500,000.
Trulia is an independent and unbiased residential real estate search engine that gives you free and open access to real estate information.
Well thats what the ABOUT webpage says anyway. Trulia focuses on real estate in California and has a fairly good search technology to power its mission. Its got a search engine feel and simply asks you to enter a CITY or ZIP CODE in California which then yields you properties for sale and a bunch of statistics about the desired location; such as Neighborhoods, Pricing Breakdown, # Beds, # Baths, Size, & Type.
A search for 'San Francisco' brings us THESE RESULTS with the most expensive listings getting priority. Click on any of the trulia logo's on the Google map and you get instant access to more listings. Under the map is a quick FACTS chart about San Francisco in terms of Average Housing Prices.
With a 2nd round of financing of $5.7M just secured, I would bet Trulia expands to other markets first before enhancing their site with more bells & Whistles.
Zillow is a 'soon to be launched' online real estate website that is being led by Expedia.com founder Rich Barton. Other than what was released to the general public, we really don't know much about this startup other than that it will be huge! With 32M in funding and 75 active employees (mainly engineers), it is sure to change the online landscape when it launches later this year.
In the meantime, Inman News Blog is holding a contest to see who guesses the closest business model to what Zillow actually will be when it launches.
I think it will be a combination of NY Times property search technology, Craigslist model of using brokers/agents to post content for public, and Ebay model of user feedback and reviews for self governance and to create a barrier to entry for future competitors. Read my recent post on Zillow.com.
What do you think Zillow will be?
In the end the brokers will have to adapt to this changing marketing environment as potential homebuyers realize new and improved online resources to find properties they might buy or rent. It doesnt pay to ignore these entities. Rather, the big firms will be striking deals with these sites as their traffic grows to get their xml feeds of corporate listings integrated.
CNN Money: Real Estate: Buy, Sell, or Hold?
Inman News: 'Normal' Real Estate Market Not Bad News
CNN Money: Blog If You Love Real Estate
Inman News: Trulia Gets Funding Boost of 5.7M
Matrix: Housing Needs a Heat Index When Real Estate Freezes Over
Hot Property: Housing Starts: Back Under 2 Million
A: An article in today's NY Post sites Harlem developer Jerry Migdol as the latest insider to admit, ..."If you want to make money, the secret is to buy low and sell high. It's so high now it's crazy NOT to sell."
One key aspect of the article discusses using the 1031s Exchange Tax Benefit to use profits of a real estate transaction for future purchases without paying Capital gains. Read my post on 1031 Exchange. Clearly, Migdol believes that the combination of very high prices and Republicans in office make it wiser to NOT use the 1031s exchange and rather pay the low taxes now and put the money in the bank for another day! He says:
'Everyone doing 1031s is nuts..They don't realize that the Capital gains taxes under the Republicans are low: 15 percent to the feds and 7 percent to NY State. Prices themselves can drop 25 percent.'
This broker and homeowner agrees. Those using the 1031 Exchange to rationalize their next higher priced property purchase are taking on more risk than the possible reward they can reap. Its worth a second thought if you are in this situation.
A: The national economy and the stock markets have the Consumer Confidence # as one indicator of the current strength/weakness in the overall economy. What current or leading indicators does the real estate industry have; let alone the NYC real estate market? Sales of existing homes? Filed Mortgage Applications? This is a very fast paced city and to keep ahead we must wisely analyze the data for hints of the near future. We need more.
The measure of Consumer Confidence consists of 2 types of analysis: Conference Board Consumer Confidence & University of Michigan Consumer Sentiment Index
Both of these tools are used to gauge the current economy in the attempt to ascertain the level of confidence among consumers regarding their current financial status and the near future. The reports are occasionally just noise, but on occasion they can predict sudden shifts in consumption patterns that may be a sign of a more dangerous underlying problem developing. While the importance and use of these consumer confidence numbers are widely debated they still have the potential to move markets when they are released and that to me means they are still worthwhile to review.
The real estate market has the following barometers to gauge the overall strength of the housing market:
Existing Home Sales - On or about the 25th of each month, NAR releases statistics on sales and prices of existing single-family homes for the nation and the four regions. Beginning on February 25, 2005, these figures include condos and co-ops, in addition to single-family homes.
Pending Home Sales Index - This new index measures housing contract activity. It is based on signed real estate contracts for existing single-family homes, condos and co-ops.
Mortgage Applications (.pdf file) - A measure of registered mortgage applications filed will give us the status of the lending and re-finance activity
There are more indicators such as New Home Sales (doesnt really affect NYC as much), Housing Starts, and Housing Affordibilty but these dont really assess buyer confidence. Maybe Housing Affordibility does if one can argue that as houses become less affordible than buyers become less interested; but I want something different.
We need a Buyer Confidence index, for housing only, that will help us gauge the strength or weakness of what really makes our real estate market move; the buyers! Maybe there is an indicator out there that Im not aware of, and if so, please post it here for me to learn from.
If we were to design a formula from scratch that would asses Buyer Confidence in the Housing Market, what questions or data would we need to anaylze? Here are a few of my ideas:
1. Open House Activity - Why cant we poll real estate agents and FSBO's on the strength of their open houses. How many people showed up? 1? 10? 30? Are the buyers coming out to view properties or are they sitting and reviewing them online from home? If they are serious buyers, then they will come to your open house? In an environment where open houses are more active, the confidence level should be higher.
2. Ratio of Contract Price to Asking Price - What was the ultimate price that buyers were willing to pay for a property compared to its original asking price? This data is known well before closing so it should be analyzed and used as a metric to gauge the strength/weakness of the current housing market. Was the contract price 10% below ask? Was it at full asking price? Or, was it 5% over the asking price? In an environment where contract price is closer to or over asking price, the confidence level should be higher.
3. Poll Buyers at Open Houses? - The Consumer Confidence number is a monthly survey of 5,000 households designed to measure Americans' optimism about their current situation and the future. Why cant we do the same for buyers of real estate? It would have to be designed mainly to measure whether the buyer is comfortable with the current level of pricing of properties compared to what they can afford. In an environment where buyers are comfortable with what they can get for their budget, the confidence level should be higher.
4. Measure Buyers' Choices - We should also analyze data from buyers on whether they have 'CHOICE' in the current housing market? Are there a few different apartments that they like and can choose from that are in their price range? Is there nothing? Some type of barometer that combines quality, quantity, and price needs to be analyzed to see whether or not it is a buyers market or a sellers market in terms of choice. This would most likely vary between neighborhoods. In an environment where buyers have a lot of choice within their financial budget, the confidence level should be higher.
I'm sure I will think of more ideas after I publish this post, but Im not going to add anything on. I want to hear your comments on this. What am I missing? Is there already a measure of Buyer Confidence in housing, and if so, how is it derived? Or, am I crazy altogether and a measure of buyer confidence is either unuseable, inheritently flawed, or not feasible to gather? I want to know!
A: Whenever an industry feeds off of the stupidty of the general public it seems the federal government needs to step in and put regulations in place to protect people from making big mistakes. The mortgage banking industry is no different. Expect regulation soon.
I've already written a post, Interest Only Loans: Are They For Me?, in the desperate attempt to educate future homebuyers NOT to rationalize buying a property they can't afford by using a creative loan product. I see it happening less now than this time a year ago, but it still happens.
I'll say it again:
If your budget is $600K and you find a property you like for $700K, DO NOT buy it using a creative loan product because chances are you will get burned down the road; either with higher monthly payments or by paying off none of the principal.
A recent CNN Money article titled, "Risky Home Loan Standards Tightening", does a very good job in explaining the worry of the federal government and the possible side-effects of any future regulation. The article goes on to point out:
Regulators worry that the popularity of these exotic mortgages may result in consumers defaulting on their loans once the typical three to five-year honeymoon period is over for borrowers, and mortgage payments can double to reflect a rise in interest rates.
If regulation is enacted on the lending industry I think the biggest side effect will be less options for potential homebuyers. While this is a good thing in protecting uneducated buyers, it will be 1 of many ingredients that will prolong a slowdown in the housing market. Quoting the CNN Money article once again, it states:
Laperriere said over 40 percent of the homes purchased in 2005 were financed by either option ARMs or interest-only loans as an increasing number of homebuyers found themselves priced out of the marketplace. If banks can't lend to as many people as they now do analysts expect this will contribute to a slowdown in the housing market.
More information on the extent of any regulation on the lending industry should be known in the coming months. However, the effect of the past few years and all the people that did use this creative loan products is still yet to be known. As rates are much higher now than they were a few years ago, I would expect homeowners who took out 3YR ARM's to face tough times when the locked in rate expires. Combine that with a cooling housing market and a dynamic shift of control from sellers to buyers, and desperation might cause the homeowner to sell at a loss.
A: With Crude Oil trading at 3 1/2 Month highs and Gold trading at near high levels of $554 per ounce, these inflation leading indicators are sure to be on the Fed's radar for the upcoming meeting.
Remember: The primary job of The Fed is to control monetary policy and maintain a stable economy and payments system while warding off the potential threats to our national economy: such as inflation, natural disasters, scandals, un-natural disasters, political, etc..
As the price of energy and gold continue to rise, the fed is more and more likely to take a cautionary stance in raising rates one last time! While general consensus right now is for 1 more 1/4 point rate hike and then a pause, if the prices of gold and oil continue to bully higher the fed might be more inclined to pause sooner.
The fed is set to meet again on January 31st. If there is a surprise and they do NOT raise rates, then expect the housing market to get a nice little boost as rates will likely dip lower temporarily to reflect the new fed stance. Lower rates mean money is cheaper to borrow for potential homebuyers which means they can afford a higher asking price. Simple as pie.
My opinion: I still think we have 1 more 1/4 point rate hike in the bag for the next meeting. If oil and gold continue to rise by that time, I would expect a clear message from the fed that the end of the rate-hiking campaign is HERE, rather than is VERY CLOSE (which was mentioned in the last Fed minutes and is the current fed stance).
A: As I browse my favorite real estate weblog, Curbed.com, I noticed this link in their Monday PM Linkage about an article posted on Hot Property today about Zillow.com; a new entity that is coming.
Here is what I do know about Zillow:
What is Zillow? A Real Estate Website startup (Not a brokerage!)
Who founded Zillow? Rich Barton. You know him, he founded a little company called Expedia.com in the 1990's. Well, that guy!
Is it going to be a MLS system? No. Actually, according to the Hot Property article:
Zillow won't be some kind of national Multiple Listing Service of homes for sale. In fact, Barton said he thinks anyone trying to create such a list is wasting time. The reason: "The Web is the national MLS already. It's happened. You're arguing over yesterday's news."
How will it make money? Advertising. It is mentioned that the model will be designed so that real estate agents and brokers will be the target customer for placing ads. Perhaps a pay-per-content system similar to that of craigslist where brokers post ads for properties. Sure its free at first, but once the site gets going, they'll be a posting fee? Who knows. The site is still months away from launching.
Will there be reviews? Yes. It seems Rich Barton is huge on user feedback and that this site will incorporate some type of 'REVIEWS' feature in it. One thing that a 'feedback' model does offer is a barrier to entry. If Zillow is successful and this catches on and garners a ton of public opinion, it could be huge for the startup. Another quote from the article states:
Lots of its information will come from users of the site--a model that has been proven highly successful by real estate blogs like curbed.com.
Is the company funded? OH YES! Zillow currently has 75 employees working, mostly engineers, and has raised $32M so far. Read the article!
It seems to me that Zillow will most likely be some sort of combination between NY Times property search, Craigslist model of using brokers as target customers, and Ebay system of feedback and self governance for users to review buildings, listings and agents. Well this seems the most likely to me anyway.
So how will brokers respond to this? Well, what can we do? In my humble opinion, I think there are still plenty of buyers out there who appreciate the hands on advice and services that real estate agents offer on both sides of the transaction.
For buyers, its not just about finding the property that fits the clients needs, but evaluting its true market value, negotiating the best price, handling the packages for the board, and co-ordinating the entire transaction until closing. For sellers, its taking emotion out of the deal, pre-qualifying the buyers, and providing mass exposure in proven marketing channels to get the highest and best offer possible.
But thats just me. I certainly think Zillow will be big. It has the perfect mix of management, connections, funds, and timing to make some sort of impact. The question that remains unanswered is, 'What will it be'?
Yahoo Finance: Want To Be Rich? Be Honest
NY Times: All That Curvy Glass: Is It Worth It?
Yahoo Finance: Oil Prices Climb on Concerns About Iran
CNN Money: Gain Control Over Your Financial Life: A Guide
CNN Money: Oil Surges To 3-1/2 Month High
Inman News: Real Estate Divas Sing Positive Tune
Curbed: Schrager's 40 Bond Eyes Big Money
The Walk-Through: Why is that Real Estate Broker Drooling?
Yahoo Finance: Rates Fall To 3-Month Low
CNN Money: 5 Slow Market Strategies
A: Real Estate mogul and "Good Morning America" contributor Barbara Corcoran listed the South Bronx as the top place to put your investment dollars in her rankings of 5 'ripe' locations for growth.
I love it! Not only do I have the utmost respect for Barbara Corcoran and what she accomplished decades ago to make her real estate company a household name in Manhattan, but I also think she has one of the best 'noses' for smelling out future growth areas.
According to an ABC News Original Report, Corcoran goes on to say:
South Bronx, N.Y. Average home: $380,000
What makes it great: The South Bronx is the last housing frontier close to New York City. It lost 57 percent of its population in the 1970s; now people are coming back. Public money is flowing in, and developers are really starting to lay their bets. Most importantly, it's attracting creative energy (artists and musicians are moving there) which can really revitalize an area.
What you can learn: Here are three tips from the South Bronx that apply to any depressed area. One, track the number of classified ads selling property each week. They should double every month. Second, assess an area at night. A night life (like clubs and cafes) is a good sign that a neighborhood is on the rise. Third, look for the price of a cup of coffee to rise. Up-and-coming neighborhoods draw expensive coffee sellers.
I especially like how she analyzes the rising price of a cup of coffee as executives at Starbucks and Dunkin Donuts do their homework to decide where to open new branches in high growth neighborhoods.
Of particular note is "...developers are really starting to lay their bets". While I haven't investigated this myself Im willing to bet that Corcoran has analyzed the public records at the attorney general's office that lists filings for building permits by developers. Usually the paperwork process that developers have to go through before being allowed to build takes years. Savvy brokers are hip to neighborhoods where developers have filed for future new buildings, both for their own real estate investing and for their clients. It seems the South Bronx has some nice action in the works that would spur development over the coming years. If you take Corcoran's advice, you'll get in early!
Personally, I think South Bronx still has some time. If you did buy now, it will probably take a good 7-10 years for you to realize appreciation gains that the 'kings of real estate' are used to when getting into a new area. Just dont expect a quick fix. If you want a neighborhood that is a bit more stable as a potential future growth area, look into Harlem.
Some of the historic districts in Harlem, such as Strivers Row and Mount Morris Park, can offer some great values if the seller gets frustrated and can't get rid of a property here. Some of these tree lined streets are beautiful and the area itself is in the midst of a radical transformation. With Columbia University's campus on 116th & Broadway and its medical center on 168th & Broadway, students and faculty are always looking for rental units closeby.
A typical townhouse in Harlem usually goes for between 1.0-1.75M, depending on the size, location and condition. This townhouse, marketed and IN CONTRACT by Douglas Elliman's 'Harlem King' Todd Stevens is a 20-footer and was priced at 1.575M:
155 West 119th Street
A typical 2BR condo in a Townhouse goes for about $600K, such as this one listed by the same broker:
132 West 123rd Street
You must analyze your strategy when deciding where to put your money. If you are sure you are buying real estate and want a medium risk/high reward property, then stick with Corcoran and look into the South Bronx. However, if you want to play it safer and want a lower risk/medium reward property, then look into Harlem!
A: No more bidding wars, no more packed OH's, no more 'NO Finance Contingency' required in contract, and less pressure on buyers.
Just because I am a real estate agent doesn't mean I have to be a salesman and always be bullish on the housing market. I hope the market corrects and I think there are hardcore signs that we have already corrected. If you read my posts you know this by now, but because no one knows of this site I'll repeat this:
WE HAVE ALREADY CORRECTED! THINK LOGICALLY. YOU ONLY KNOW OF A MARKET CORRECTION WHEN IT HAS ALREADY OCCURRED. SO YOU MUST SELL IN A RISING MARKET TO EVER GAIN THE RIGHT TO PROCLAIM " I, ME, SOLD AT THE TOP!"
Now that this is out of the way, lets go over some of the 'in the field' occurences that are proving that we are in the process of a correction.
No More Bidding Wars: The # of people showing up at a standard 2 hour open houses has been increasing as of late, but still not anywhere close to where it was this time last year. Without packed open houses, its hard to convince buyers that you have multiple offers and a 'best & final' set for next Tuesday, 6PM.
No Finance Contingency? Tough To Get: Adding a 'No Finance Contingency' clause to your contract will NOT be an easy task these days. Buyers are hip to this obvious move by the seller in fast-rising markets, but not in slow ones! You can try, but if your buyer puts up a fight don't give up a deal because of it.
Pressures on Sellers: There is an increasing pressure on sellers to use a broker in a slowing market. Getting your property full market coverage and getting your listing in the central system for all brokers to see is absolutely vital! Remember, there are plenty of good leads sitting in the hands of buyer brokers that ONLY bring their clients to your listing if you are offering a commission. Feel free to try on your own, I even wrote a post on it, but reality is you are only marketing your property to about 25% of the buyer pool.
Less Pressure on Buyers: With the fed 'very close' to ending its interest rate hiking campaign, it looks like it will be a good lending environment for buyers for some time. The pressure that rates may be higher if I dont buy now is just not there. I personally think there will be a rate-easing campaign coming in our future (see my post on 5/1 ARM). Also, the psychological pressure that comes from packed open houses is not there. If there are no 'Best & Final' deadlines declared, whats to rush you into placing a bid immediately?
These are the realities of the residential sales industry in Manhattan. Its happening. The data is being collected so that articles can be written about it 3-4 months from now.
MY PREDICTION: Expect a short lived bounce in the NYC housing market over the next few months. However, I really do not think the sales market will be as active as most of us had hoped. For the remainder of 2006, expect a flat to slightly down market.
The Good News: Buyers who have been priced out of the NYC markets for the past year or so should have their eyes peeled for good values. As prices are reduced, buyers will be ready to jump in. So be aggressive; especially if you find an apartment that fits your needs which has been drastically reduced from its original asking price!
The luxurious new building that is being built opposite the Mayor's Mansion on East End Avenue has already sold a few units from what I hear. Pricing exceeded the $1,500 sq. ft. price level for this prime location in the Upper East Side. Well, I say prime location to the locals that have settled into this 'far east' upscale neighborhood where it takes a good 15 minutes to walk to the subway. If a 2nd Ave subway line does proceed as planned without future political or financial disruption, this east side neighborhood will surely see an increase in value with a new state of the art transit line now only minutes away. Wishful thinking though as I believe the first patch of this new line will be from 96th to 59th and will not be completed until around 2015.
The building is going to include incredible amenities for its residents and is sure to set the bar for future luxury new developments. According to the building details,
"...12,000 square feet amenity include a fully equipped gym, squash court, golf simulator, toddlers play room and art room, billiards room, 40 seat screening room, library and a family interactive center with high tech, latest invention arcade games. Peter Marino designed landscaped private garden and waterfall with seating. Also has an on-Site parking garage. Spectacular views overlooking East River and Carl Shurz Park."
I see 23 units on the market right now, mostly 2-4 bedrooms. Prices are as follows:
A-Line: 2BR-2.5BTH; 1,650 sq. ft.; 2.85M
C-Line: 1BR-1.5BTH; 1,009 sq. ft.; 1.75M
F-Line: 3BR-3.5BTH; 2,207 sq. ft.; 4.3M
H-Line: 3BR-3.5BTH; 1,751 sq. ft.; 3.275M
B-Line: 2BR-2.5BTH; 1,507 sq. ft.; 3.35M
C-Line: 3BR-3.5BTH; 1,916 sq. ft.; 3.85M
E-Line: 3BR-3.5BTH; 2,216 sq. ft.; 4.45M
G-Line: 3BR-3.5BTH; 1,731 sq. ft.; 3.425M
Pricing on more lines can be provided for you by request; please email me for more information. More details on 170 EEA will be provided as I receive them.
Yahoo Finance: Dow crosses 11,000 for 1st time since 2001
Newyorkology: A year after groundbreaking, Harlem's Marriott idles
New York Business: No construction yet at Harlem Park
NY Times: Listings of High-End Condo's Proliferate
Kiplinger: Where To Put Your Money Now
CNN Money: Gold at Highest Point Since '81
A: High End housing in NYC is slowing down with units staying on the market much longer, and if not priced aggressively is putting sellers in the bad position of having to reduce their asking price numerous times. How low can it go? It depends on how desperate the seller is and how soon they need the money!
Its the toughest niche market to sell in when the housing market starts to slowdown as the New York City real estate market has over the past 6-8 months. Those looking to sell their properties on 5th Avenue, Madison Ave or Central Park West are finding it tough to get their original asking prices. I'm hearing that Open Houses are just that, OPEN with not many people showing up. Are buyers scared to put down their millions in NYC real estate if they think the market is slowing down? Seems to be the case. But savvy buyers will be especially vigilant during these times to try to low-ball a high end property that has already reduced their asking price 1,2 or even 3 times.
Look at 1016 Fifth Avenue, a very desireable pre-war co-op building on 5th Ave between 82nd & 83rd streets. Even with Central Park right across the street units in this building are being reduced drastically in an attempt to spur buyer demand.
There are currently 4 high end units listed for sale in this building:
On the market since 1/11/2005
Reduced from $8.3M to 7.3M
On the market since 3/17/2005
Reduced 3 times from 3.55M to 2.995M
On market since 6/7/2005
Not Reduced Yet - 5.95M
On market since 9/24/2005
Not Reduced Yet - 7.8M
Now, this is a first class pre-war building that resides in a prime location in the Upper East Side. The building is literally steps from Central Park & the Metropolitan Museum of Art while the building offers a brand new fitness center, individual basement storage, and a staffed elevator. How low will it go? No one knows for sure but I can tell you that the units that have not been reduced yet are sure to be feeling the pressure from the ones that have reduced their asking prices closer to market value already.
Those in the market to buy a high end 2-4 bedroom apartment with a high priority on proximity to Central Park should keep their eyes on these units for further price cuts. In the end, you might be able to squeeze out a substantial discount for this very high quality product.
High end buyers should use this philosophy for other luxury buildings across Manhattan where the seller is in the uncomfortable position of lowering their asking price until a buyer steps forward!
Its important to note that sellers usually rely on their hired broker to advise them on how much the price should be reduced, and that the concept of price-reducing is NOT an exact science. After months on the market, the seller broker probably just wants to do a deal and might lower the property's price too aggressively to get one done.
Will you be the lucky buyer of a property reduced too much?
A: According to The Money Store, the current rate on a Jumbo 5/1 ARM is 5.25%. Not bad. If you do not see yourself in the same apartment 5 years from now, I think it is a great idea to take out this mortgage product which might expire at a time when interest rates are actually lower than today's quote!
Taking out a ARM mortgage product can be a very wise move if used correctly and in the right environment. When I say 'used correctly' I am reffering to the notion that you know for sure that you will be moving come time the ARM expires. That way if rates have increased dramatically from the time you took out the loan, you will not be affected. When I say 'in the right environment' I am reffering to the notion that interest rates are expected to FALL come time when your ARM expires. This way, come expiration rates will actual be LOWER than when you first took out the loan.
The only problem with this idea is the unknown. No one knows what will happen over the course of the next 3-5 years that might affect interest rates. The economy could all of a sudden heat up, the stock market could get too high, a natural disaster might slow the economy, or worse, an un-natural disaster might occur unexpectedly. You should always be aware that interest rates and how the Fed controls them is a constantly changing dynamic.
When analyzing the data now, it seems very possible that interest rates will hover around levels slightly higher than we are today for a few years. Then, a cooling economy (which is debated but predicted by the bond markets) would cause the Fed to start a new rate-easing campaign whose aggressiveness or life is yet to be known.
I wouldnt lock in a 30YR Fixed rate if you think you will upgrade or move out in 5 years or so. Go for a 5YR or 7YR ARM product (add on 1-2 years to the loan product if you are not sure) and that should put you in a good position to re-finance when the loan expires.
A: After reading a Curbed.com reader ask the question of loyalty to her Buyer Broker, I had an urge to write this post explaining the job of a Buyer Broker and how one can help you in your real estate needs. There are NO FEES to use the services of a Buyer Broker as their commission is split with the Seller Broker at closing!
My Definition of a NYC Buyer Broker: A broker who represents the buyer and has a fiduciary responsibility to the buyer in finding a property that meets their needs on all levels (price, location, size, condition, style, and living quality). A buyer broker should look to find the best value for their client and negotiate on their behalf during the bidding process to get the lowest possible purchase price from the seller. In times of bidding wars, the buyer broker should advise their client on how high over ask the buyer should bid without overvaluing the property or putting their client in financial risk.
In addition to these services a Buyer Broker will prepare the client for the real estate transaction in a number of ways:
1. Assist the buyer in finding a Real Estate Lawyer if one is needed to review the property's offering plan, 2-Years building financials, and contract of sale.
2. Assist the buyer in finding a mortgage broker if one is needed. A good buyer broker will ask their client what their strategy is with their investment and advise their client on possible mortgage products that could be used. Ultimately, the mortgage broker is the professional you should rely on for the final product to use.
3. Preparation of the board package. If buying a Co-op, the buyer broker should be especially vigilant to providing everything that is requested by the board and preparing the package in a professional manner. If buying a Condo, this process becomes much less tedious.
4. Co-ordinate visits to the property for contractors as needed and accompany the client on the final walk-through prior to closing to fully inspect the property based on the contract of sale's terms and conditions. All electrical, plumbing, and appliances should be in working order.
Most buyer brokers, also known as Real Estate Salespersons or Agents, are in real estate as their full time profession which does not mean they know what they are doing. It is up to the buyer to determine whether or not their buyer broker is responsible, knowledgeable, and privy to the current housing market prices and developments.
I can tell you that as a broker (aka, Real Estate Salesperson) there is a ton of competition out there and very little loyalty. The more experienced brokers understand the need to 'set themselves apart' by offering their clients exceptional service in the most professional manner possible. My thinking is:
I am going to find you the highest quality apartment that meets your needs for the lowest possible price, and do it in a way that makes this transaction a positive experience for you that you will refer my services to all of your friends and family when they need to satisfy their real estate needs
As a buyer you should be especially vigilant that your buyer broker is really out there to assist you, and is not just trying to make another sale. Is your broker showing you apartments in your price range? Is your broker showing you apartments with low monthly's? Is your broker doing the necessary homework to only show you apartments with S/W exposures? Is your broker going out of their way to accomodate your schedule? Is your broker constantly showing you properties that are away from your desired neighborhood? These are the things you should ask yourself when analyzing your broker.
In the end its not about the deal, its about finding you the best apartment possible and making you happy with your new home and investment!
A: ONLY If you are are NOT taking this type of mortgage product so that you can afford the purchase price of the apartment you are about to buy. Read that last senetence again if this applies to you, and then read the post for more detailed opinion.
INTEREST ONLY LOAN: a loan where the principal is paid back at the end of the term and only interest is paid during the term. The payment covers only the interest and the actual loan balance remains unchanged.
There are 3 things that scare me in this world: Diets, Turbulence, & Interest Only Loans!
It amazes me that even after the collapse of the greatest Stock Market Bull Run ever, that people havent learned their lesson about living a financially sound lifestyle. Let me be clear when I say this...
IF YOU PLAN ON BUYING AN APARTMENT, WHEREBY YOU NEED TO TAKE A INTEREST ONLY LOAN PRODUCT TO BE ABLE TO AFFORD THE MONTHLY PAYMENTS, THEN YOU ARE BUYING A HOME THAT YOU CANNOT AFFORD!
The Fed released the minutes from the Dec. 13th meeting of economic policy makers that control the Feds funds interest rate. A key sentence in the minutes clearly shows differing thoughts on whether or not the Fed will continue to raise rates, signaling that the end of the current 2 year rate-hiking campaign is very close.
"Views differed on how much future tightening might be required," the minutes said. "Although future action would depend on the incoming data, this characterization of the outlook for policy was seen by most members as indicating that, given the information now in hand, the number of additional firming steps required probably would not be large," the minutes continued.
I still believe very strongly that there is at least 1 more 1/4 point rate hike at the next fed meeting. But my contention now is that this will be the last one, barring any unforseen event that disrupts the national economy. This will keep mortgage rates below 7% and still at fairly low levels historically as we move into the first few months of 2006.
A: Looking at the fundamentals, the demand, the available listings for sale, inflation indicators, fed minutes, etc., I do NOT think the NYC market is in a real estate bubble. Rather, I believe a healthy correction is already underway after years of unsustainable growth. This correction will probably be followed by a short term flattening of the housing market which could then be powered by a rate-easing campaign by the new Fed chief in the years to come.
My definition of a bubble crash: You buy an apartment for $600,000 in 2005 that previously sold for $400,000 in 2001. The bubble burts a year later and you can only sell it for $450,000 in 2006. That to me is evidence that there really was a bubble. Did this happen yet? NO!
After reading other NY Real Estate blogs devote so much effort to the bubble, i.e. The Walk-Through NY Times Blog's "Believing is Seeing", I felt a need to throw my 2 cents in for New Yorkers to digest.
New York City is such a different animal than other markets nationwide and deserves to be looked at as such. I do not think the NYC real estate market is in a bubble waiting to crack. Rather, I think NYC housing has ALREADY started its healthy correction by declining a good 12-15% in the past 8 months alone. If you look at stats, you will see these:
- The US median new home price dropped 4.1% in November
- Existing US homes sales dropped 1.7% in November
- The Yield Curve has inverted
So? Is this really that unexpected (expect for the yield curve)? I've been saying for months that a housing correction is not only needed but already underway! The question is, how much of a correction will it be and for how long? This is always the trickiest part to determine so lets just do our best to analyze what is really going on in the hopes of making an educated guess as to what may or may not happen.
For this argument its important to analyze the news-worthy INVERTED YIELD CURVE:
Definition: An uncommon situation in which long-term interest rates have lower yields than short-term interest rates. This is often a sign that interest rates are expected to decline. also called negative yield curve.
I believe the curve ONLY inverted very briefly before correcting, but nevertheless this caused a plethora (thanks El Guapo) of news stories marking the event. Historically, an inverted yield curve is a leading indicator of a coming recession, whereby the Fed will have to LOWER INTEREST RATES to help stimulate the economy and prevent a recession turning into a depression.
If the bond markets are predicting tougher times ahead for the US Economy, it will be very interesting to see how the fed handles the situation without Alan Greenspan. I think that rates are 1-2 hikes away from flattening out and a year or 2 away from the beginning of a new rate-cutting campaign to combat a possible recession. Thats what the inverted yield curve is telling me. So, if the timeline looks at 2006 as the end of rate hikes with Fed Funds Rate settled around 4.75%, then late 2007 could be the period when the Fed begins to lower interest rates again. How low they will go is dependent on market factors at that time and is impossible to predict right now.
If this case turned out to be true, give or take a couple of months in timing, I would expect a Flat To Lower 2006-2007 for housing (NO BUBBLE CRASH!!!) with the possibility of a rising housing market in 2008-2009. To get in before the rise, you will need to buy BEFORE the fed starts easing.
When I look at the years of 1999-early 2001, I see the fed raising interest rates to combat the over-heating economy caused by the dot.com and technology boom. Fed Funds Rate topped off at 6.50% in May of 2000 when the Fed started its monster RATE-EASING campaign to combat the impending economic fallout that was to come. Yes, they were too late! Rates fell fast and went from 6.50% to a low of 1.0% in the summer of 2003. The NYC housing market started to heat up in 2001, as rates kept diving, until Sept. 11th caused an expected sharp downturn. After 6 months, the market corrected and started its surge to record levels over the next 3 1/2 years. So, it was when the fed funds rate was between 1.0% and 3.0% that we saw the biggest gains in housing prices with red-hot demand and record low mortgage rates. Right now the feds rate is at 4.25% and looks to be heading north to 4.5% or 4.75%. This will cause the FLAT to LOWER housing markets in 2006 and 2007 that I predicted earlier.
As the fed hikes rates it usually takes about 4-6 months or so for the effects to be truly felt in the US economy. With a new fed chief coming in I seriously doubt that he will disrupt the markets by raising rates too much, which historically has been a highly criticized action of Mr. Greenspan & Company. I see rates stopping at a max of 4.75% which in my opinion is NOT high enough to cause a housing crash. If Im wrong and the fed pushes rates above 5.0%, then expect a much sharper downturn in housing nation-wide!
I would be looking at the timeline of late 2007 or early 2008 for the Fed to possibly start lowering interest rates again. This will re-vitalize the housing markets once again and deflate the notions of a possible housing bubble pop. In addition, we should have a much clearer picture of what the fed intends to do by this time next year. If the economy is heading for recession than it is almost certain the Fed will lower rates sooner rather than later, which would then create a recipe for another housing bull run.
To sum: Expect a slow 2006 for NYC housing. Expect a rate-easing campaign to be started in the years to come which would create another good buying opportunity for those with their eyes open. If housing falls 10% during 2006, there could be some very good buying opportunities during the course of early-mid 2007 for those who get in BEFORE the fed starts easing!
A: I am starting a NEW Category called "Buildings I Like" in the hopes of pointing out exceptional buildings to live in when compared to its peers. I will use quality of service, financial health, location, current pricing levels, and amenities as factors in determining buildings I like! The Astor Terrace Condiminiums is an award-winning luxury building in the upper east side on 2nd Avenue between 93rd & 94th streets.
As for the immediate neighborhood, its changing! Within blocks you now have a Yura Bakery & Restaurant, Blondie's Sports Bar, Brother Jimmy's Bait Shack, Parrot Bay, Don Pedro's, Kebab Turkish Wraps (NEW), Milano's Italian Gourmet, Hokkaido Sushi (NEW), Nicks Pizzeria, Zeytina Fine Foods, Delizia Italian, Tony's Family Style, The Vinegar Factory, Schaller & Weber Meats, Papaya King, Carl Schurz Park & Gracie Mansion, Central Park, 6 Trains at 96th & Lex, new B-Ball & Tennis courts, a newly renovated Rupert Park, Rainbow, and almost anything else you've gotten used to as a new yorker!
The building has its own private driveway between 93rd & 94th streets right off of 2nd avenue, which allows residents to easily drop off, pickup, load the car, or park in its attached garage. Above the underground garage which is right across from the building lobby, is a private gated garden with waterfall for residents to use. At night it becomes a popular place to meet other residents for a bottle of wine.
A 24HR doorman plus concierge provides security and convience for those who live in this very well maintained building. With 3 elevators plus a huge service elevator for move-ins, porters and contractors residents are able to get up and down without much of a wait.
The building reserve fund is still over $1M even with the recent required building inspection and maintenance work that was completed. maintenance costs are relatively low when compared to other buildings without tax abatements, but the service is sure to be of much higher quality. Those who live in Astor Terrace know and tend to stay there for a long time.
All in all I believe this building to be trading at a discount, when I compare it to its peers in the neighborhood. You could expect to spend about $850/Sq. Ft. or under for a 1BR at Astor Terrace, when other condo units are selling closer to $950/Sq. Ft.. In this tight market, buying a property in a good building at a discounted price is a feat very hard to accomplish. So if your looking in the Upper East side be sure to check out whats for sale at this building. Its worth the trip over!