I am disabling the comments feature temporarily until I get a chance to upgrade Movable Type or install some type of comment spam solution. It has gotten too out of control. If you have any ideas for how I can control comment spam, please email me! Thanks and sorry for temporary inconvienence!
Well, we are closing on our condo tomorrow evening and packing and moving out tomorrow morning. I will be without a computer for the next 4-5 days as I temporarily settle in with family as I search for a new home in NYC. Needless to say, this week will not have any live chats and postings will be minimal. By Monday or Tuesday of next week I should be settled in and back online.
If you have any specific questions about real estate that you want my opinions on, feel free to email me and Ill do my best to get back to you in a timely manner. Thanks.
A: Here is the monthly report showing the # of NEW LISTINGS that have come to market across New York City. In the graph below I compiled data based on certain price groups and compared the # of New Listings that came to market in MAY vs JUNE.
Neighborhoods Included: Battery Park City, Central Park South, Chelsea, Clinton, E. Harlem, E. Village, Financial District, Flatiron District, Gramercy, Greenwich Village, Harlem, Little Italy/Chinatown, Lower East Side, Midtown, Murray Hill, SoHo, Sutton Area, Tribeca, Upper East Side, Upper West Side, W. Village
CONCLUSIONS: The month of June experienced a general slowdown in new listings inventory coming to market, especially in the $501K-$750K price group, which experienced aproximately a 21% decline in new listings in June when compared to May. The $1.001M-$1.5M price group also showed a statistical decline in new listings with aproximately 19% decline. Since I am so new to these inventory charts, and only have been doing them for 3 months now, I would think the slowdown in new listings is consistent with the seasonal market that affects NYC.
Generally speaking, there is less inventory on the market during the hot summer months of JUNE-JULY-AUGUST as most people leave the city during this time, especially on weekends. Sellers experience a slowdown in activity at OH's and usually are 'looser' in their reactions to low-ball offers; a good sign for serious buyers who know they intend to buy during the summer! I would expect more of the same when calculating the inventory report for next month.
CURRENT STATE OF THE NYC HOUSING MARKET: Very similar to last month's analysis! Most sellers are still in denial about the housing cooldown and price their property's at last years levels with the hopes 'their home' will get that perfect uneducated yet wealthy buyer. Not so. Time on market is still about 2-5 months or so as most seller's these days will lower their asking price at some point during the sales process. Buyers are very savvy and patient resulting in no bidding wars that I am aware of, and sellers should realize this dynamic sooner rather than later when discussing the future of their marketing strategy with their hired representative broker.
My advice to sellers: Give yourself time to sell your apartment in today's market. Should you HAVE TO sell right away, be sure to aggressively price your apartment otherwise it just won't sell as fast as you hope.
A: The housing market is still hanging in there nationwide despite lending rates on 30YR fixed averaging around 6.8%, a four year high. Mortgage applications rose for the 2nd consecutive week as buyers seem to still be choosing to own rather than face rising rental costs. On a side note, energy prices quietly have trickled higher towards a record high, bringing back another inflation pressure for the fed to deal with.
According to CNN Money:
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.81 percent, up 0.01 percentage point from the previous week. Interest rates were just 0.05 percentage point below a four-year high reached two weeks prior.Out here on LI, I'm noticing an awful lot of FOR SALE signs as I drive around town and a noticeable amount of FOR SALE BY OWNER signs too. While I have nothing to compare it to as I have lived in NYC since 1999, family members tell me it is definitely more than usual.
As for lending rates, expect them to be flat-to-trickle higher as we get closer to the fed's next meeting in August. General consensus is for another 1/4 point rate hike but any economic data showing a slowing US economy might lead Bernanke to pause first, and raise rates at a later time. In my opinion, the fed still will have to deal with the lagging effects of higher energy prices as oil is now at record highs near $76/Barrel.
According to CNN Money again:
Oil surged to record highs near $76 early Thursday as worries over lower U.S. crude stocks were underlined by increased tension in the oil-rich Middle East and suspected explosions at a pipeline in OPEC exporter Nigeria. "Geopolitical risk is out of control," said Tony Nunan, a manager of risk management at Mitsubishi Corp.WHAT MAY HAPPEN WITH RATES: Watch out for the possibility that fed chairman Bernanke PAUSES with their 2+ year rate hiking campaign only temporarily, while they asses future economic data and the lagging effects of very high energy prices. As this happens, the fed can certainly RAISE RATES AGAIN IN THE FUTURE AFTER THE PAUSE should inflation prove harder to contain then first thought. The skinny, just because the fed pauses in the near future does NOT mean the next set of moves will be lower rates!"There's a pipeline attack in Nigeria, Israel is taking a strong stance and that's adding fuel to the fire, but more than anything it's U.S. gasoline demand holding up and the Iran situation."
A: Another week, another set of price reductions to report over the last 7 days. The last report I noted 129 price reductions for Manhattan, while the past 7 days registers 130 price cuts, only slightly higher than last week's reported totals. Here are a few to keep an eye on.
TOTAL PRICE REDUCTIONS THIS WEEK ---> 130 (1 more than last reported)
STUDIO PRICE REDUCTIONS
153 East 57th Street; Apt. 18C
Size: 400 SFT + TERRACE
# Beds: 0
# Baths: 1
maintenance: $828
Asking: $345,000 (Reduced Three Times From $400,000)
*Bellmarc Website Does NOT show last price cut from $372,500 TO $345,000. Please inquire as central system shows reduction on 7/13/2006.
Price Per Sq. Ft.: $862 (Terrace makes valutaion higher)
Marketed By: Lewis Friedman of Bellmarc
1BR PRICE REDUCTIONS
201 West 16th Street; Apt. 5B
Size: 800 SFT
# Beds: 1
# Baths: 1
maintenance: $1,248 (High; Read My Post Here)
Asking: $675,000 (Reduced Twice From $715,000)
Price Per Sq. Ft.: $844 (Location Keeps Valuation Higher)
Marketed By: Joy Weiner of Corcoran
2BR PRICE REDUCTIONS
100 West 57th Street; Apt. 9N
Size: 1,150 SFT
# Beds: 2
# Baths: 2
maintenance: $1,888
Asking: $999,000 (Reduced From $1.095M & Below Mansion Tax Level)
Price Per Sq. Ft.: $869
Marketed By: Kristina Ojdanic & Greg Kammerer of Corcoran
**OPEN HOUSE SUNDAY JUL 16th 2:30-4:00PM**
A: The new development at 60 East 55th Street is on a roller coaster ride of asking prices with price reductions and price increases over the past few months. Where the ride will end nobody knows!
I'm not sure what the sales office sees in the market or sales trends data for this new development between Park & Madison, but what I do know is that prices keep jumping around as some units offer an 8% commission to the accompanying broker if a deal is brought to the table. The higher commission incentive is not new as Sellsius Real Estate blog reported weeks ago on a property that was offering a 10% commission to the brokers involved in the deal in an attempt to stimulate activity; not the best method though in my opinion as to get away with this the asking price almost certianly will be increased passing the higher brokerage incentive onto the buyer!
Moving onto the new development, besides the prime location here are some of the amenities being offered:
On-Site Core Club Amenities Include:
As for prices, here is an example of the ups-and-downs I was reffering to earlier in the post:
Apt: PH1 w/ 8% Commission (2300 sft 3BR/3.5BTH)
Original Asking Price ---> $5.1M on 5/2004
Raised To ----> $8.632M on 2/2005
Dropped To ---> $5.25M on 4/2005
Current Price Raised To ---> $6.1M on 10/2005
Apt: 15A w/ 4% Commission (900 sft 1BR)
Original Asking Price ---> $1.0M on 6/2005
Raised To ----> $1.360M on 10/2005
Dropped To ---> $1.295M on 6/2006
Current Price Raised To ---> $1.360M on 7/12/2006
Apt: 15B w/ 8% Commission (528 sft 1BR)
Original Asking Price ---> $800K on 8/2004
Current Price Raised To ----> $935K on 4/2005
Apt: 16D w/ 8% Commission (940 sft 1BR)
Original Asking Price ---> $1.375MM on 12/2004
Raised To ----> $2.068M on 2/2005
Dropped To ---> $1.425M on 4/2005
Current Price Dropped Again To ---> $1.25M on 4/2006
Just to name a few!!! See what I mean.
The way new developments market their properties is that the sales office releases a bunch of units at a time. For example, the first phase of pre-construction will consist of 12 total apartments; 4 1BR's, 4 2BR's, & 4 3BR's. Once all these sellout, the next phase of 12 units will be released at a higher price than the first phase; and so on until all units are sold. At least this was the way developers usually marketed their properties in the past. Now that the housing market is cooling, developers seem to be releasing more units at a time so as to give the buyer more choices to meet their own unique needs. Its certainly not the norm, but is happening more often than in the past.
I'f you do plan on buying a new development, be SURE TO READ MY POST ON 421 TAX ABATEMENT's and what that means for you!! Good Luck!
A: With his 2 day testimony to Congress finishing up today, I can tell you right now that fed chief Ben Bernanke is getting grilled as the members of the Committee of Banking, Housing, & Urban Affairs put Big Ben on the hotseat as the fed tries to strike a balance in monetary policy in a very uneasy environment of inflation pressures, geo-political tensions, and a cooling housing market and US economy.
The reason why equities markets rallied yesterday was a combination of being oversold over the past few weeks and Big Ben's comments to Congress where he declared: Should that moderation occur as anticipated, it should help to limit inflation pressures over time
This one statement was quickly interpreted by the trading markets to mean that we are very close to the end of the rate hikes as a cooling economy will by itself moderate inflation, and that another 1/4 point rate hike at August's meeting is now expected but not gauranteed! Fed funds futures are now at 70% or so in pricing in another 1/4 point rate hike at August's meeting, but dropped sharply in predicting any future rate hikes after that. Yields on the 2YR, 10YR, and 30YR bonds all dropped as well in addition to the US dollar's fall once this statement was released. Remember that bond yields and the US dollar rise as monetary policy is tightened making fixed assets more attractive and debt more expensive.
Very interesting as fed chief Bernanke and the other voting members of the FOMC are dealing with a very unstable environment and still dangerously high energy prices. I just dont see how all of this will come to resolve itself with a cooling US economy. Inflation is far more damaging than a future recession and Bernanke & Co. know this all too well. So why take chances?
The Skinny: Even if Bernanke pauses down the road, don't expect rate cuts to happen so fast. Big Ben even said that:
"The increase in energy prices is clearly making the economy worse off both in terms of real activity and in terms of inflation. There is no question about it," Bernanke told the House Financial Services Committee. Surging energy prices are acting like a double whammy on the country's economy, crimping growth even as they push up inflation.It's a tough world out there if your trying to time the real estate market and I'm doing my best to analyze where monetary policy is heading and how that affects the real estate market as a whole. In a nutshell: MONETARY POLICY IS LAGGING IN ITS EFFECTS AND AS LONG AS THE FED CONTINUES TO RAISE RATES AND BATTLE INFLATION, LENDING WILL BECOME MORE EXPENSIVE. AS LENDING BECOMES MORE EXPENSIVE, BUYERS WILL BE FACED WITH LESS AFFORDABILITY IN PURCHASING POWER AS THEY SEEK TO BUY A NEW HOME. AS BUYER DEMAND DAMPENS DUE TO MONEY BEING MORE EXPENSIVE TO BORROW, SELLERS WILL BE FACED WITH LONGER TIME ON MARKET AND FORCED TO REDUCE THEIR PRICE TO ATTRACT A BUYER.
Are you beginning to see why I talk about the fed and monetary policy so much here on UrbanDigs! Of all the great comments I get about the content of the site, I have received a few emails saying to stay away from fed talk. I disagree with this as I feel it is so important to monitor our new fed chief and how he reacts to environments such as the one we are in now, and especially pay attention to what rising interest rates ultimate affect on housing turns out to be! It will only help all of us invest more wisely in the future.
A: A quick rundown of the latest search that yields the most inexpensive condos in NYC below 96th street. Perfect for any homeowner that seeks 10% down, no board approval, unlimited subletting ability, and an easy flip come resale! Remember that condo's can be marketed to a much larger buyer pool giving the seller more pricing power at resale.
Here is my pick of the litter of condos in NYC below 96th that are priced under $400K. When analyzing you must understand that the lower end market for condos in NYC has held up very strong as the higher end markets soften. This is why price per square foot is still at or near $1,000/sft., as inventory is still tight for sub $400K condos.
225 East 46th Street; Apt. 2F
Size: 425 SFT
# Beds: 0
# Baths: 1
maintenance: $357
RE Taxes: $200
Asking: $399,000
Price Per Sq. Ft.: $939
Marketed By: Nancy Rapp of Halstead
1724 Second Avenue; Apt. 2D
Size: 400 SFT + Balcony
# Beds: 0
# Baths: 1
maintenance: $254
RE Taxes: $129
Asking: $399,000 (Reduced from $430K)
Price Per Sq. Ft.: $1,000
Marketed By: Paul Anand of Citi-Habitats
220 East 46th Street; Apt. 2F
Size: 400 SFT
# Beds: 0
# Baths: 1
maintenance: $387
RE Taxes: $194
Asking: $399,000 (Reduced 3 times from $450K)
Price Per Sq. Ft.: $998
Marketed By: Nicole Hatoun of Corcoran
201 West 74th Street; Apt. 7C
Size: 400 SFT + Balcony
# Beds: 0
# Baths: 1
maintenance: $488
RE Taxes: $151
Asking: $399,000 (Reduced 3 times from $489K)
Price Per Sq. Ft.: $998
Marketed By: Susan Leeds of Halstead
105 West 77th Street; Apt. 4E
Size: N/A
# Beds: 0
# Baths: 1
maintenance: $103
RE Taxes: $129
Asking: $380,000 (Reduced from $395K)
Price Per Sq. Ft.: $N/A
Marketed By: Milton Elbogen of Corcoran
A: The prestigious Inman Conference Innovator Awards will be handed out today at the Inman Conference in San Francisco. Unfortunately I will be driving my fiancee to Newark Airport to be with her mom in Europe while she awaits surgery next week. It sucks to miss this conference especially when UrbanDigs was nominated for 'Most Innovative Real Estate Website Award' along with 4 of my co-bloggers!
JUST WANTED TO WISH THE OTHER GUYS A LAST GOOD LUCK AND THAT I WISH I COULD BE THERE! HOPEFULLY I'LL GET TO MEET ALL OF YOU AT THE NYC INMAN CONFERENCE IN JANUARY 2007!
*Live Chat Ending Early today. If you need to ask me a question, please leave an offline message.
A: Back by popular demand is the BEFORE & AFTER of floor resurfacing which includes sanding, staining and poly'ing your hardwood floors in an attempt to save $$$ but make your home glow again! I constantly get asked about redoing hardwood floors by buyers in the field, and most already assume they have to rip up the old floor and install brand new flooring. Not so, as this quick and easy renovation will save you time, money, without much of a sacrifice in quality.
These guys at FloorWorksNY did a fantastic job re-finishing my hardwood floors. The Sedona Red Miniwax came out great and the last minute decision to go with the High Gloss water based poly instead of the Semi-Gloss was a good one! The work speaks for itself and the floor just looks incredible; and at 1/10th the cost of laying down a high quality new floor!
A BIG THANK YOU to Marc and the workers at FloorWorksNY! This agent recommends them to any seller looking for a low-cost MUST renovation before their property hits the market!
A: GO DIGS!!!! TAKE IT DOWN! Although I couldn't attend the Inman conference I got a fantastic email at 10:13PM last night telling me that UrbanDigs WON the 'Most Innovative Real Estate Blog' Award!! Here is the article at Inman.com.
An excerpt:
Inman News for the first time this year gave an award for the Most Innovative Real Estate Blog, adding a new category. The winner of this first-time award was Urban Digs, published by New York City real estate agent Noah Rosenblatt, who launched the blog last September. In addition to entries about real estate situations and questions, Rosenblatt offers live chat sessions with site visitors every weekday.And a quote from Bradly Inman:
"In today's economy, innovation determines success," said Bradley Inman, founder and publisher of Inman News. "In the view of myself and my editorial board, UrbanDigs.com has earned this award by finding new ways to succeed."
Thank you all for making this site work and I promise you to give my best to bring you tips to PROFIT (working on misspelling in main image) from NYC real estate by telling it 'like it is'! I guess the LIVE CHAT feature is here to stay as the 4 months I have been doing it so far has been a great success both for me (and the great people I met) and hopefully for those I was able to assist. Thanks again!!
A: Every homeowner and buyer knows the importance of where lending rates are headed because it directly affects the monthly payments that they will be responsible for. As rates rise, so do your monthly payments making a property a bit less affordable depending on your income. Here are some thoughts on lending rates as reported by the blogosphere.
LENDING RATES ARE CORRELATED WITH THE FED FUNDS RATE WHICH NOW STANDS AT 5.25% AND CONTROLLED BY THE FOMC AND FED CHIEF BEN BERNANKE. THE FED FUNDS RATE IS RAISED IN TIMES OF ECONOMIC BOOM AND INFLATION WORRIES TO SLOW DOWN THE ECONOMY. THE FED FUNDS RATES IS LOWERED IN TIMES OF ECONOMIC SLOWDOWN AND DISTRESS TO STIMULATE CAPITAL & CONSUMER SPENDING TO HELP SPUR ECONOMIC GROWTH. RIGHT NOW WE ARE IN THE FORMER ENVIRONMENT.
Mortgage Reports: A great blog focused on mortgage rates and the like by Dan Green. He reports:
I am predicting that rates will remain unchanged over the next 30 days, but that doesn't mean you should necessarily follow my advice when choosing whether to lock a rate, or float it. My advice may not be appropriate for your individual situation.If you are shopping for mortgages and the idea of not having a rate lock commitment makes you nervous -- regardless of my predictions -- I recommend that you go ahead and lock in your rate. There is just too much financial risk in floating a mortgage interest rate -- especially given the volatile nature of the markets.
Mortgage Matters: Holden Lewis's blog on bankrate.com tells it like it is and how surveys of top lenders turn out. He reports:
In this week's Bankrate.com survey, the average rate on a 30-year fixed fell 12 basis points. Actually, though, rates have been at a standstill -- all or most of that drop occurred a week earlier, during and immediately after Bankrate's July 19 mortgage rate survey. Because of timing, we didn't catch that decline, so it spilled over into this week's survey.Hot Property: Hot Property is BusinessWeek's real estate blog and has some good stuff. Here is a very interesting response to a reader's complaint about the big swings in lending rates offered by E-Loan. It doesnt cover the direction of mortgage rates, but is interesting enough to bring to your attention.Yeah, it's confusing.
The Complaint:
I need to lock in a rate in the next week for a house in Silver Spring and have been shocked by how much the rates change from one day to the next.The Response:
Specifically, what the Loan Consultant was referring to was the fact that the 10-year treasury benchmark had dropped in the previous couple of days to its lowest in 4 months. However, your writer is comparing this to the Freddie Mac rate which is a backward logging rate - always looking back about a week or so whereas most lenders tend to move with the market. In other words, the writer was not comparing apples to apples. Unfortunately, it seems that consumers are often misled - or tend to misunderstand - the relationship to mortgage rates of these Freddie Mac announcements.Finally, here is a chart from FreddieMac.com showing the change in lending rates over the past 7 weeks:It's usually best to lock in a rate in the morning since most lenders tend to increase their margins at the end of the day and put out their best price in the morning to encourage applications and locks.
Macro economic discussions and investment strategies for Manhattan real estate. The goal will always be to maintain an open forum and provide analytical tools to help make NYC real estate more transparent.
