Items of Interest SALES OF PREVIOUSLY OWNED HOMES SLUMPED IN JANUARY Including single-family, town homes, condominiums and co-ops, sales of existing homes slipped 0.4 percent below December in the U.S., bringing the rate 23.4 percent lower than one year earlier and establishing a nine-year low. According to the National Association of Realtors (NAR), the median price was $201,100, down 4.6 percent from a year earlier. The latest data show roughly half of the metro areas in the United States had price gains, with healthy increases in markets such Buffalo, Peoria and Amarillo. Total inventory rose 5.5 percent at the end of January to 4.19 million existing homes available for sale, representing a 10.3-month supply, up from a 9.7-month supply in December, when relatively few properties tend to be listed. Single-family home sales were 0.5 percent below December and 22.4 percent below January 2007. The median existing single-family home price was $198,700, down 5.1 percent from a year ago. Existing condominium and co-op sales fell 6.5 percent to a seasonally adjusted annual rate of 550,000 units, 30.2 percent below the year earlier. The median existing condo price was $220,400 in January, 1.0 percent lower than January 2007. "The declines have been smaller than they previously were, but I think we're still on the way down,'' Nigel Gault, director of U.S. research at Global Insight told Bloomberg News, "Prices are going to have to keep going down if we're going to work off the supply.''
The U.S. Commerce Department reports that sales of new single-family homes declined 2.8 percent in January to a seasonally adjusted annual rate of 588,000 units, the slowest pace since February of 1995. Three out of four regions posted lower new-home sales in January, with a 10.3 percent decline reported in the Northeast, 7.6 percent in the Midwest and 2.4 percent in the South. The West posted a 2.2 percent gain for the month, following a large decline in December. While the inventory of new homes for sale was down 2.2 percent, the supply of units at the current sales pace edged up to 9.9 months, its highest level since April of 1982. The median length of time that completed homes were on the market was 6.7 months in January, up from 6.2 months in December and 4.8 months a year earlier. RESPECTED INDEX POSTS BIGGEST DROP IN ITS 20 YEARS The S&P/Case-Shiller national home-price index for the fourth quarter fell 8.9 percent from a year earlier, the largest drop in its 20 years of data, according to the Wall Street Journal. And the Office of Federal Housing Enterprise Oversight's (OFHEO) index - which tracks only homes purchased with mortgages guaranteed by home-loan giants Fannie Mae or Freddie Mac - was down 0.3 percent, the first year-to-year decline in the measure's 16 years. Commented OFHEO Director James B. Lockhart: "Although prices for home purchases in the quarter fell in every state except Maine, only 16 states plus the District of Columbia showed price declines for the full year 2007." FREDDIE MAC SEES PRICES FALLING IN HOMES UNDER $417,000 EAST HAMPTON HOME PRICES NOSEDIVE You can now buy a single-family home for under $1 million, reports the New York Post. The median price has dropped to under seven digits for the first time in more than a year - from a high of $1.225 million to a mere $975,000, a slide of 20.4 percent, according to Suffolk Research Service. The figures echo the double-digit percentage drop all over the East End. In the town of Southampton, prices peaked at $999,999 and fell to $815,000, down 18.4 percent, as of the end of January. "Markets are acts of God, and it's my guess God's not very happy with the Hamptons," said SRS president George Simpson. "Greed is all over the Hamptons - the 'look how big mine is' syndrome. Prices had gone through the roof because of all the hype." Still. . . Someone paid $1 million for a three-month summer rental, and an oceanfront house in Southampton with a $65 million asking price has a buyer in contract. And figures show the median price of a home in the five East End towns has jumped 70 percent in the past five years. PERMITS FOR RESIDENTIAL BUILDING HIT 35-YEAR RECORD The year 2007 saw the highest number of building permits for privately-owned residential units in New York City since 1972, according to newly released data from U.S. Census Bureau records. With 31,918 units permitted in 2007, it was the second highest amount of permits issued since accurate records first began being kept in 1965. Seventy percent of the permits issued in 2007 were for units in the Bronx, Brooklyn, Queens and Staten Island, the rest being in Manhattan. While the Bronx and Staten Island saw permit numbers decline, the Bronx still posted the fourth highest total in more than three decades. HAVE YOU NOTICED THAT MAINTENANCE IS SKYROCKETING Average co-op maintenance fees in Manhattan last year were 30 percent higher than in 2002, compared with a 9 percent difference in the previous five-year interval, according to an analysis of residential sales data by the Miller Samuel appraisal company. The New York Times also reports that condos had a 38 percent increase in combined common charges and real estate taxes in the most recent five-year comparison versus 27 percent in the previous five-year period. The old yardstick of $1 in maintenance for each square foot in the apartment has gone the way of the nickel candy bar. Doorman buildings in Manhattan now average $1.37 per square foot in maintenance fees or in the case of condos, real estate taxes and common charges, according to Miller Samuel. Buildings without a doorman average $1.22 per square foot. Many brokers selling in Manhattan's prime residential areas put the range higher - at $1.40-1.60 for a doorman building to more than $3 a square foot for ultra-luxury buildings. AND THERE'S NO FREE BREAKFAST, CONDO OWNERS LEARN New construction condos that offer more amenities than five-star hotels not only come with hefty price tags at closing time - increasingly, they also come with rising monthly common charges, notes the Real Deal. The deluxe amenity packages that have become standard fare at new condos things like health spas, dry-cleaning services and pet grooming are one of the leading factors in the spike in condo fees, real estate attorneys and management companies said. While condo charges are still lower than monthly co-op maintenance fees, (partly because they do not include real estate taxes), they are not the selling point they once were, especially because the luxe add-ons are coinciding with rising fuel costs, ballooning payroll fees, and increasing property insurance premiums and security expenses. Real estate attorney Luigi Rosabianca noted that one condo he knows of in the Financial District recently began offering a continental breakfast in a common lounge. "After three or four months, the owners realized it was costing them about $500 to $600 a day," Rosabianca said. "They figured out the yearly cost and are no longer serving breakfast." AN OFFER 33% BELOW THE ASKING PRICE GOES NOWHERE Columbia Law School professor Hans Smit, who has listed a mansion for $30 million, turned down a $20 million offer, according to the Wall Street Journal. William Tuthill, the architect of Carnegie Hall, designed the 1909 French Renaissance-style marble house for cigarette magnate Morris Schinasi. The free-standing private house on Riverside Drive measures 12,000 square feet and has Hudson River views. WHITHER THE CONDO MARKET, ASKS THE SUN NEW TENANTS BILL MAY SPAWN LAWSUITS, SOME SAY Real estate lawyers and lobbyists say a bill that allows tenants to sue landlords for harassment would jam the court system, according to the Real Deal. Unanimously passed by the City Council, the bill awaits the signature of Mayor Bloomberg. It allows tenants to sue landlords for harassment, which can include incessant buyout offers by owners eager to turn low-performing units into high-end rentals, the bill's sponsors said. But Adam Leitman Bailey, an attorney who represents both landlords and tenants, said the bill was "irresponsible" and would unleash a flood of frivolous cases. Council Member Melissa Mark Viverito, one of the co-sponsors of bill 627-A, disagreed, saying the vast majority of housing court cases are initiated by landlords. Opposing the bill were the Rent Stabilization Association, which represents the city's rental property owners, and the Real Estate Board of New York. COST OF NEW RENTAL BUILDING IS DISCOURAGING DEVELOPERS GET OUTTA THERE If you want to recycle your old computers and its components, TVs, VCRs, DVRs, DVD players or cell phones, head to the southeast corner of 17th Street and Broadway on Sunday 8 a.m.-2 p.m. Rain or shine, the Department of Sanitation will take them off your hands for free but offer no receipts for the electronics. Nor will scavenging be permitted. At the same time, you can donate "gently" used clothing and lines to Goodwill, which will provide receipts for tax deductions. STOP AND SMELL THE CHLORINE, YOURS Private pools, says the Real Deal, are making a splash in Manhattan. One builder estimated that there are thousands of them, mostly in condos and townhouses. Vanity Fair recently included a spread of filmmaker Julian Schnabel's new Palazzo Chupi in the far West Village, pool included. Bob Guccione's former townhouse on East 67th Street has a 32-foot Roman-style pool on the first floor. Supermarket magnate Ron Burkle paid $17 million for the former Sky Studio at 704 Broadway, which hosted Jerry Seinfeld's wedding; the place comes complete with a 25-foot heated pool that has been featured in some "Sex in the City" episodes and cost the previous owner $500,000 to build. In the suburbs, a concrete pool starts at $85,000, said David Coonan, general manager of All American Custom Pools in Norwalk, Conn., but a pool in the city with smaller dimensions starts at $135,000 (double for steel). DESPITE THIS MOVE, GREENWICH IS STILL FASHIONABLE Tommy Hilfiger is putting his stately Connecticut mansion on the market there, according to the New York Post. The fashion mogul, who will be moving to Manhattan when interior work on his Plaza duplex is completed this summer, is asking $27.9 million for the new-construction spec home he bought in 2005 for $18 million before adding sublime personal touches. Included in the 20,000-square-foot Georgian-style house, on just more than four acres, are seven bedrooms, 13 bathrooms, a great room with a 30-foot ceiling, a basketball court, a spa with a waterfall, a theater, a gym and a 2,000-bottle wine cellar. Also included are grand-scale entertaining rooms, an elevator and eight fireplaces. The gated landscaped property with gardens and manicured lawns, known as "Stonehill," is surrounded by stone walls and features a pool, pool house and tennis court. Hilfiger recently sold his East Hampton oceanfront home on Further Lane for $26.5 million, and sources say that he is looking for a smaller place in Greenwich. HE'S HARDLY SINGING THE BLUES Less than a month after selling one Los Angeles home for $3.8 million, actor Dan Aykroyd has put another one on the market for $2.6 million, reports the Wall Street Journal. Meanwhile, he continues to ask $7 million for a New York condominium on East 88th Street. The $2.6 million listing, a colonial-style house in the Hollywood Hills, was purchased by the 55-year-old comedian and his brother, Peter, for $732,500 in 1987. Former owners of the house that Aykroyd recently sold for $3.8 million include the late Mama Cass Elliot of the Mamas and the Papas. Beverly D'Angelo, Chevy Chase's co-star in the "National Lampoon's Vacation" series, bought the home. Near Laurel Canyon in the Hollywood Hills, the one-acre property has a house with five bedrooms, six fireplaces and a pool and is walled and gated. SHE MUST BE THE RARE FILM STAR WITHOUT AIRS Parker Posey has moved on from her East 10th Street co-op, reports the New York Post. According to city transfers, the star of nearly 50 films including "Party Girl" and "Waiting for Guffman" has pocketed $1.3 million for the one-bedroom, one-bath walkup on the top floor of a townhouse. She was asking only $1.17 million for the place, which sports a fireplace and brick walls. Posey now lives on lower Fifth Avenue, where she paid about $1.3 million for a two-bedroom place in a building with a doorman and an elevator. IT'S A LONG, LONG WAY TO SCHOOL FOR THIS ACTOR Daniel Radcliffe, who played Harry Potter in five movies (and counting) made his New York real estate debut last November with the purchase of a $4.3 million loft-style two-bedroom at 40 Mercer Street, the trendy glass-walled building designed by Jean Nouvelle. Now, Radcliffe, operating through his family holding company, Gilmore Jacobs Ltd., has bought a second downtown spread, a 2,450-square-foot corner three-bedroom on an upper floor at 1 Morton Square, at Leroy Street. It faces the Hudson River, with a high-flying witch's broom view of New York Harbor. The price was $4.9 million and the closing was last month. This time, Radcliffe actually plans to move to the apartment, according to several people briefed on the deal, in time for his Broadway debut in a revival of Peter Shaffer's "Equus," scheduled for the fall, performing a role he also had in the London production of the play. The new apartment has luxurious features, according to the listing. There are curved windows pointing in the direction of New York Harbor, marble and granite counters and a 500-bottle wine cellar. The sellers had paid $2.6 million for it in December 2004, according to city records. NEW CONFORMING LOAN LIMITS HIT $729,750 IN NYC AND D.C. The federal government released the maximum conforming loan limits that will be in effect through year end, permitting Fannie Mae and Freddie Mac to purchase loans as high as $729,750 in costly metro areas such as New York, the District of Columbia and Los Angeles. The maximum loan limits apply to mortgages originated between July 1, 2007 and Dec. 31, 2008. Fannie Mae and Freddie Mac are still in the process of updating their underwriting standards and loan processing software to make loans of up to the new max. In high-cost areas, single-family loan limits are being increased to 125 percent of the median home price, with that upper cap of $729,750. The cap is $934,200 for two-family homes, $1,129,250 for three-family homes, and $1,403,400 for four-family homes. RATES PLUNGE, FOLLOWING BOND YIELDS DOWN The 30-year fixed-rate mortgage (FRM) averaged 6.03 percent for the week, down from last week's 6.24 percent and 6.14 percent last year at this time, according to Freddie Mac. The 15-year FRM this week was 5.47 percent in comparison with 5.72 percent last week and 5.86 percent a year ago. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.34 percent this week, down from 5.43 percent last week and 5.90 percent last year. One-year Treasury-indexed ARMs were 4.94 percent this week, down from 5.11 percent. It was 5.47 percent last year at this time. "Weak economic reports that indicated declines in the job market, slowing in manufacturing and low consumer confidence drove bond yields lower this week and mortgage rates followed," commented Frank Nothaft, Freddie Mac vice president and chief economist. He noted that interest rates for 30-year fixed-rate mortgages are now at the same levels as they were two weeks ago, erasing last week's upward jump. THE FEDS INCH TOWARD RESCUING BORROWERS However much they might oppose it on ideological grounds, the Bush administration and the Federal Reserve are inching closer toward a government rescue of distressed homeowners and mortgage lenders, says the New York Times. Fed Chairman Ben S. Bernanke told a group of bankers in Florida that "more can and should be done" to help millions of people with mortgages that are often bigger than the value of their homes. Though Mr. Bernanke stopped well short of calling for a government bailout, he used his bully pulpit to try to push the banking industry into forgiving portions of many mortgages and signaled his concern that market forces would not be enough to prevent a broader economic calamity. He also suggested that the Federal Housing Administration expand its insurance program to let more people switch from expensive subprime mortgages to federally insured loans. And he urged Fannie Mae and Freddie Mac to raise more capital so they could buy more mortgages. The companies already guarantee or hold as investments about $1.5 trillion in mortgages. Similarly, the Bush administration, despite its public opposition to bailouts, has set the stage for a bigger government role. FORECLOSURES SOARED IN JANUARY The volume of U.S. foreclosure filings rose about 57 percent in January compared with the same month last year, according to foreclosure research company RealtyTrac, reports Inman News. Nevada led all states with foreclosure filings for 0.6 percent of all households, followed by California with a 0.44 percent household foreclosure filings rate and Florida at 0.37 percent. Nationally, there were 233,001 foreclosure filings in January, and the household foreclosure rate was 0.19 percent. Foreclosure filings rose more than 100 percent year-over-year in January in Rhode Island, Massachusetts, Florida, California and Arizona. Virginia, Maryland and Connecticut also had substantial gains in foreclosure activity, though RealtyTrac reported that the increase in those three states may be inflated because of changes in data coverage. RealtyTrac CEO James J. Saccacio noted that the 8 percent monthly increase in foreclosure filings was not as sharp as the 19 percent monthly spike in January 2007. "It could be that some of the efforts on the part of lenders and the government - both at the state and federal level - are beginning to take effect," he said. "The big question is whether those efforts are truly helping homeowners avoid foreclosure in the long term or if they are just temporarily forestalling the inevitable for many beleaguered borrowers." ARE FOUNDATIONS AN ANSWER Some of the nation's wealthiest philanthropies are turning their attention to the growing foreclosure crisis, which some fear could usher in the type of urban blight that devastated pockets of American cities in the 1970s and 1980s, according to the Wall Street Journal. "Every big funder is out there trying to figure out how to participate in systemic responses," says George McCarthy, a senior program officer with the Ford Foundation. The problem, he says, is that "no one can figure out where the opportunity lies" and how philanthropic dollars can be spent most effectively. In addition, Living Cities, a consortium of major foundations and financial institutions working to revive inner cities, is considering funding programs to keep borrowers in their homes and get abandoned properties back into use. Many of the group's members have worked over the last decade on ways to create affordable housing and reduce urban blight. "Unfortunately, a lot of that progress is being wiped away or has the potential to be wiped away," says Ben Hecht, the group's chief executive. CUOMO WINS A BATTLE AGAINST MORTGAGE FRAUD Lenders who want to do business with Fannie Mae and Freddie Mac will no longer be allowed to use in-house staff appraisers or appraisal management companies they own or control under an agreement with regulators that New York Atty. Gen. Andrew Cuomo initiated, says Inman News. Fannie and Freddie have agreed to new standards designed to ensure the independence of the appraisal process; they will provide $24 million in funding over a five-year period for independent monitoring of the new standards. The agreements are an outgrowth of New Cuomo's yearlong investigation into the packaging of mortgage loans into securities sold to Wall Street investors. National banks "have a clear choice," Cuomo said. "Immediately adopt the new code and clean up appraisal fraud in the mortgage industry or stop doing business with Fannie Mae and Freddie Mac - it is that simple." Significant federal-state tensions remain, noted the New York Times. In a statement on Monday, the Office of Thrift Supervision, which regulates savings banks such as Countrywide and Washington Mutual, said that "the agreement has some positive elements," adding its concern that "the closed-door fashion in which it was reached could result in negative unintended consequences." MANY LATE PAYERS ARE GETTING NO HELP FROM THE FEDS Of about six million people who have subprime mortgages, about 16.7 percent are behind in their payments and 6.8 percent are in foreclosure, says the New York Times. Industry analysts predict that as many as three million subprime mortgages could end up in foreclosure over the next several years. Hope Now, an industry alliance created last fall in response to the mortgage crisis, reported that almost 150,000 subprime borrowers have received some kind of "loan modification" since September and that the number of modifications jumped 16 percent in January, to 45,320 loans. Despite the increased willingness of mortgage companies to give troubled homeowners a break, however, only a tiny share of the subprime borrowers received any help and more than half of those who did get help received only a "repayment plan" to catch up on their missed payments. MORTGAGE ACTIVITY BUMPS UP Mortgage loan application volume for 3.0 percent on a seasonally adjusted basis for the week ending Feb. 29 from one week earlier, reports the Mortgage Bankers Association. On an unadjusted basis, the increase was 15.3 percent compared with the previous President's Day holiday shortened week and 1.1 percent versus the same week one year earlier. Refinancings were 4.5 percent higher the previous week, seasonally adjusted, and there were 1.4 percent purchase applications. The refinance share of mortgage activity grew to 52.4 percent of total applications from 52.0 percent the previous week, and the adjustable-rate mortgage (ARM) share increased to 17.3 from 15.0 percent. IT'S NOT QUITE REDLINING, BUT LENDERS ARE RULING OUT AREAS As property values decline and credit markets contract, the Wall Street Journal says home lenders nationwide are growing ever more unwilling to finance home purchases in sharply declining housing markets, driving prices down further. In some cases, lenders have ruled out entire geographic regions and property types altogether, most notably high-rise condominiums in South Florida and Las Vegas. Lenders including BankUnited, a unit of BankUnited Financial, and Vertice, a wholesale lending unit of Wachovia, have elected not to lend to some areas or properties because of declining prices. Countrywide Financial Corp., the nation's largest mortgage lender, considered a similar move last week before reversing course, and other lenders have tightened underwriting guidelines for slumping markets so as to make financing nearly unattainable. In healthy markets, New York's J.P. Morgan Chase will currently lend borrowers a mortgage equal to as much as 90 percent of a property's value. For borrowers in states that have declining markets, however, the bank reduces that maximum, says Tom Kelly, a spokesman for the bank. J.P. Morgan then reduces that level even further for borrowers in the worst declining markets, Kelly says, though he declined to provide specifics. CitiMortgage, a wholesale lending operation of another large Wall Street bank, Citigroup, maintains a list of "declining market areas" that red-flags dozens of counties in more than 10 states. Citi reduces the amount it will lend for properties in those counties "by at least 5 percent," the document says. DELINQUENT LOANS REACH 23-YEAR HIGH The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 5.82 percent of all loans outstanding in the fourth quarter of 2007, according to the Mortgage Bankers Association (MBA). The rate of foreclosure starts and the percent of loans in the process of foreclosure are at the highest levels ever as a result of increases for both prime and subprime loans. From the previous quarter, prime fixed rate loan foreclosure starts remained unchanged at 0.22 percent, but prime ARM foreclosure starts increased four basis points to 1.06 percent. Since the fourth quarter of 2006, the foreclosure start rate for prime ARMs increased from 0.41 percent to 1.06 percent and the rate for subprime ARMs increased from 2.70 percent to 5.29 percent. The foreclosure start rate for prime fixed loans increased from 0.16 percent to 0.22 percent and the rate for subprime fixed loans increased from 1.09 percent to 1.52 percent. Chief Economist Doug Duncan said it was significant that amount of new rates on adjustable rate mortgages was becoming "less of an issue." He added that the six-month LIBOR rate, the index rate used for many subprime ARMs, has come down around 2.5 percentage points since last September, "greatly reducing the payment shock on many ARM resets." Though defaults increased across the country, much of the rise came from a handful of large states such as California and Florida. Those two states account for about 21 percent of all mortgages but 30 percent of the new foreclosures. Nevada, Arizona, Michigan and Ohio also had high default rates. SOME HOME EQUITY LENDERS ARE DIGGING IN THEIR HEELS They are starting to slam the door on homeowners who want to refinance their primary mortgages, according to the Wall Street Journal. In some cases, homeowners who in the past would have been easily approved for a mortgage refinancing are finding that they can't get their home-equity lender to give the go-ahead, which is required to complete the transaction. Others are being told by their home-equity lender that they need to reduce the size of their loan or line of credit. WITHOUT SAVING, YOU MAY NEVER PAY OFF THAT MORTGAGE More than three-quarters of Americans say they expect to pay off their mortgages before they retire, according to a survey by the American Savings Education Council, reports the Internet Broadcasting Company in Realtor magazine. But Stephen Brobeck, executive director of the Consumer Federation of America, says the respondents in a survey were too optimistic. "Hard data about savings behavior suggest that responses to several questions were buoyed by the personal optimism of respondents," adds Brobeck. Among all households surveyed, 27 percent had household income greater than $75,000; 33 percent had income between $35,000 and $75,000; and 30 percent had incomes below $35,000. Of the high-income group, 81 percent report saving at least 5 percent of their incomes, but only 34 percent of the lower-income groups were able to do that. IN CAMBRIDGE, MASS., TAKE A HIKE That city is the best walking city in America, with more residents walking to work and more parks per square mile than any other city evaluated in a new, if strange, study by Prevention magazine and the American Podiatric Medical Association (APMA). Walking "kudos," as the APMA put it, also went to New York, ranked second, and Ann Arbor, third. The worst walking cities: Oklahoma City, North Las Vegas and Gadsden, Ala. Prevention and the APMA annually team up to measure the walkability of America's cities as interest in walking for fitness remains strong. Why they have to undertake this endeavor annually is not unexplained. But the APMA does disclose criteria such as the percentage of adults who walk to work, number of parks per square mile, use of mass transit, and percentage of adults who walk for fitness. YES, DEVELOPERS PAVE THE WAY FOR CONSERVATIONISTS Developers faced with rising housing inventories and weakened demand are selling off unused tracts of raw land, and they aren't buying new ones, according to Newsweek in Realtor magazine. This trend has encouraged local governments and conservation nonprofits to find the money to buy up property for parks and preservation. For example, Florida's Gov. Charlie Crist has instructed the state Department of Environmental Protection to explore land acquisition opportunities. In Arizona, the city of Phoenix bought a 963-acre parcel of pristine desert for $85 million in November and now is now eyeing 8,000 additional acres. In Portland, Ore., the Trust for Public Land, a nonprofit, is closing in March on 27 acres that it purchased from a developer after he was unable to build a residential neighborhood. "Timing is everything," says David Richert, Phoenix's liaison to the state Land Department. "The pressure is there not to miss the opportunity." A
GLOOMY OUTLOOK IS FORESEEN FOR THE SUBURBS For 60 years, Americans have pushed steadily into the suburbs, transforming the landscape and (until recently) leaving cities behind, notes the Atlantic. "But today the pendulum is swinging back toward urban living, and there are many reasons to believe this swing will continue," the magazine continues. "As it does, many low-density suburbs and McMansion subdivisions, including some that are lovely and affluent today, may become what inner cities became in the 1960s and '70s - slums characterized by poverty, crime, and decay." VULTURES ARE REPLACING SEAGULLS IN MIAMI Home buyers from around the U.S. and abroad are descending on Florida to buy condominiums that have suffered sharp price drops amid the housing glut, subprime-mortgage crisis and credit crunch, the Wall Street Journal reports. Some are searching for investment properties, while others are hunting for vacation or retirement homes. Yet pitfalls abound, and experts warn that prices could dip even further. In hard-hit Miami-Dade County, condos originally costing as much as $1.4 million at the peak of the market now sell in some cases for $840,000, a 40 percent drop. Farther north, a coming auction at Solaire at the Plaza, a new condo tower in downtown Orlando, has set a minimum selling price of $170,000 on 24 one-bedroom units once priced as high as $296,000. Florida is a microcosm of what's happening across the country. As the price of condos - which tend to be popular among investors, retirees and second-home owners - take a dive in many once-hot markets, buyers are emerging to grab properties on the cheap. FROM THE DEPARTMENT OF WHO WOULDA THUNK IT The price of sawdust has soared since 2006, up from about $25 a ton to more than $100 in some markets, reports the Wall Street Journal. Blame the housing slump: Fewer new homes mean fewer trees cut for use in construction, which leads to less sawdust and other wood waste, driving up the price. Farms use sawdust and wood shavings as cozy and clean bedding for horses and chickens. Particle-board makers devour it by the boxcar to fashion a cheap building material. Auto-parts manufacturers blend a finely pulverized sawdust called "wood flour" with plastic polymers to make a lightweight material to cover steering wheels and dashboards. Wineries use oak sawdust as a flavoring agent for some wines. Perdue Farms, which raises broiler chickens, goes through seven million cubic feet of wood shavings a year. Oil-rig operators in Wyoming and Colorado pour sawdust into the caverns they find deep inside rock formations as they hunt for pools of petroleum. Sawdust gives drill bits something to grind through. Lesson: Be careful what you drink. AN ADVOCACY GROUP CLINGS TO ITS OPTIMISM The volume of existing-home sales is expected to remain stable through late spring with a gradual recovery during the second half of the year, according to the latest forecast by the National Association of Realtors (NAR). "The higher loan limits for both FHA and conventional loans will increase consumer choice and provide greater access to lower interest rate mortgages in high-cost regions," says Chief Economist Lawrence Yun. "Therefore, a notable rise in home sales can be anticipated in the second half of the year." The Pending Home Sales Index was unchanged from December, but it was 19.6 percent below January 2007. "This additional sign of a stabilizing market is encouraging, and our members are telling us there's been a pickup in shopping activity," according to Yun. "Our hope is that the increased traffic of buyers looking at homes will translate soon into more contract offers." Sales for 2008 are projected to rise 3.5 percent in 2009, while prices are forecast to decline 1.2 percent to a median of $216,300 this year and then increase 3.5 percent in 2009. The NAR also envisions a 23.7 decline in new-home sales this year before rising 7.2 percent in 2009. Housing starts, including multifamily units, will probably fall 25.1 percent and slip another 2.7 percent in 2009, according to NAR's predictions, which include a drop in the median new-home price of 6.1 percent to $232,200 this year before rising 5.1 percent in 2009. IF GOING GREEN, BRING SOME GREEN Most homeowners like the idea of going green - until they get the bill, says the Wall Street Journal. With home sales slumping and consumers rethinking their remodeling budgets, building contractors and suppliers are dangling green upgrades. They hope that energy-efficient systems and products made from sustainably harvested materials will hook consumers concerned about global warming, pollution and natural resources. Yet with a few exceptions, green materials and construction cost extra, making them a hard sell. Enermodal Engineering, a Canada-based consulting firm, estimates the premium at 5-10 percent, depending on how extensively a builder uses recycled materials and water- and energy-efficient products. When Specpan, an Indianapolis research firm, surveyed builders recently for Building Products magazine, the greatest number estimated a 10-19 percent cost increase when going green. There are signs, though, that the industry's sales pitch is resonating. In the American Institute of Architects' fourth-quarter survey of 500 architects, 61 percent said their clients are interested in "renewable" flooring materials such as cork and bamboo, up from 53 percent a year earlier; 47 percent said clients wanted high-end appliances, down from 65 percent. The greenest home, though, may be the one you live in now, given the cost in dollars and pollution of ripping out old materials and producing and shipping new ones, the National Trust for Historic Preservation noted in recent issue of the magazine Preservation. New York architect Andrew Kotchen reminds clients they can save energy and fossil fuels simply by building smaller mansions. "Bigger isn't better," he allows. THESE DOGS ARE BARKING UP THE RIGHT BEDS Radar the beagle and Taz the Australian kelpie are part of a crack team of sniffer dogs sweeping apartments and hotel rooms across the city to combat bedbug infestations, reports the New York Daily News. The animals are specially trained to root out the pesky, blood-sucking insects, which nest in mattresses, upholstery and other furniture. "We are inundated with requests from hotels and apartment owners," said Carl Massicott, whose Advanced K9 Detectives has six dogs working steadily and two more in training. "It's difficult to keep up with the demand," he said. The city's Department of Housing, Preservation and Development says 6,889 infestation complaints were logged in the fiscal year ending last June, and 2,008 building owners were hit with summonses. In 2004, there were just 537 calls about bedbug infestations, and only 82 landlords were slapped with violations. "A dog's nose is cutting-edge technology," Massicott said, apparently with a straight face. "Our animals are 100 percent honest and trained to work for food and love instead of profits." Unlike him. BE PREPARED FOR DISASTER WITH THESE ONLINE HELPERS Download free home-inventory software such as KnowYourStuff.org, a service of the Insurance Information Institute, or MakeLifeEasy.org, the Wall Street Journal suggests. The software will help you inventory your home by creating files for individual rooms and adding descriptions of their respective items, including the purchase date, replacement cost and serial number. You can also upload photos through some services. Scan receipts and appraisals, and include them in your home inventory to prove the value of an item. Find out if the software provider offers free or low-cost secure online data storage. For instance, vault24.com/public charges $14.99 a year to store a home-inventory project that you can access via its Web site in the event of a disaster. (The site also links directly with KnowYourStuff.org.) When taking inventory, you should typically make a videotape, describing each item you see. Store your video or DVD in a safe-deposit box, along with a printed copy of your inventory, and give another copy to a friend or relative. Over There... Where the world's biggest fortune cookie factory producer makes its home, Long Island City is distinguished as well by its short commute to Manhattan, its views of Manhattan across the East River and its far lower housing costs than Manhattan (and other boroughs). When it comes to Long Island City, ironically, it is, in fact, all about Manhattan. The area where condos are sprouting like asparagus in the spring is called Hunter's Point, and can be is reached by no fewer than eight subway lines - most conveniently, the No. 7, which is but one stop and five minutes between Times Square and the heart of the neighborhood as well as other prime locations in Long Island City. Also linking the place to Manhattan is the Queensboro, or 59th Street, Bridge, the completion of which in 1908 heralded the transition from farmlands to urban living. Chartered in 1870, LIC, as it also is known, is one of Queens' earliest municipalities. Ranging from Newton Creek to LaGuardia Airport, Long Island City comprises all or parts of Astoria, Sunnyside, Dutch Kills and, of course, Hunters Point. Such a broad swath of western Queens inevitably contains a variety of ethnic communities as well as a long-running industrial center with defunct factories such as the now-demolished Pepsi bottling plant and resurrected ones such as the massive Silvercup Studios, which once operated as the Silvercup Bakery. Having become part of New York City in 1898, Long Island City has undergone a dramatic conversion, with new residential and commercial uses, in recent years. Major thoroughfares include Vernon Boulevard, which is lined with boutiques, bars and restaurants for several blocks; 21st Street, which is mostly industrial and commercial; Queens Boulevard, which leads west to the bridge and follows Route 25 east to Long Island; and the western-most portion of Northern Boulevard, which becomes Jackson Avenue (the former name of Northern Boulevard) west of Queens Plaza. One of the most prominent features, aside from the bridge, is the community's green skyscraper, the 658-foot Citicorp Building, built on Courthouse Square way back in 1989 in an act of corporate daring. It is the tallest building on Long Island and in New York City outside of Manhattan. Bakeries have figured prominently in the history and rejuvenation of Long Island City - for example, the Wonton Food Company, which bakes four million of fortune cookies a day. Lucky numbers included on fortunes in the company's cookies led to 110 people across the United States winning $100,000 each in a May 2005 drawing for Powerball. The former Sunshine Bakery is now one of the buildings housing LaGuardia Community College. (Other buildings in the institution's complex originally served as the location of the Ford Instrument Company, at one time a major producer of precision machines and devices.) Then there is the former Silvercup Bakery, which took on its current role starting in 1983. Numerous television programs have been produced or originate there now, including The Sopranos, 30 Rock, Knights of Prosperity, Six Degrees and Sex & the City. Among the feature films that have been shot at Silvercup are Music & Lyrics, El Cantante, The Devil Wears Prada, Little Children, The Night Listener, Birth, Stay, Hide & Seek, Dark Water, Uptown Girls, Two Weeks Notice, Changing Lanes, People I Know, Mr. Deeds, Big Daddy, Little Nicky, Gangs of New York and Mickey Blue Eyes. Not surprisingly, movies have sometimes given Long Island City starring as well as roles. Gantry Park in Hunter's Point was used as background for the final scenes of Steven Spielberg's film Munich and also The Interpreter. Long Island City was featured more prominently in the 1997 movie, Sunday, filmed on location. Artists have been in the vanguard of Long Island City's transition, turning spaces in former factories into vast lofts. The late Isamu Noguchi, for one, converted a photo-engraving plant into a workshop; the site is now a museum dedicated to his work. Mark di Suvero now works out of Long Island City as well. A plant that was home to Swingline Staplers was the temporary headquarters of the Museum of Modern Art. And LIC is the home of 5 Pointz, a building housing artists' studios, which has been (legally) painted by a number of graffiti artists and is visible near the Courthouse Square station on the 7 train. Also in Long Island City is the P.S. 1 Contemporary Art Center (an affiliate of the Museum of Modern Art), the oldest and second-largest non-profit arts center in the United States solely devoted to contemporary art, and SculptureCenter, New York City's only non-profit exhibition space dedicated to contemporary and innovative sculpture. Relocated from Manhattan's Upper East Side to a former trolley repair shop in Long Island City and renovated by artist/designer Maya Lin in 2002, SculptureCenter was founded by artists in 1928. Unlike many gentrified neighborhoods in brownstone Brooklyn that were originally middle class, Long Island City has, until recently, always been an Archie Bunker blue-collar enclave. Much of the community's grittiness remains; many of the blocks are long, uninviting and unimproved. Neighborhood amenities are scarce; forget about a supermarket for now, though Fresh Direct delivers there (often to refrigerated rooms designed for that purpose in new buildings). If ever there was a phoenix rising, it is Long Island City. The ashes may still be much in evidence, but there is much talk about what is to come. A 10-mile-long waterfront park is slowly being built. A new library and school are planned. There is considerable excitement about the forthcoming openings of a Duane Reade and new Amish Market, which has been delayed until May. But a few restaurants well worth a detour such as Tournesol and Manducatis are flourishing; a sandy beach without swimming is a summertime lure; water-taxi service is available seasonally; and indoor tennis continues to attract players from Manhattan and elsewhere. When an LIC resident talks about such change, about a phoenix that still will be ascending years from now, that individual's eyes light up and he or she sometimes seems to reflect the passion of a cultist. For, as the characters in Saturday Night Fever, appreciated all too well, Manhattan will always be "over there." Perhaps the most profound change in Long Island City is the plethora of new developments, either through conversion of old buildings or the construction of new ones. They have names such as Arris Lofts, Fusion, the Crescent Club, the Echelon, the Badge Building, the Powerhouse and the Foundry, some nicely evoking and others not so nicely ignoring the area's past. Parking conditions vary; at some, parking is assigned, while at others it is available for sale from approximately $50,000 -75,000 a space. Apartment prices are considerably lower than for comparable units in Manhattan, demonstrating that the cost - and the value plus potential value - of living in a neighborhood with sparse amenities that is one river and five minutes away from what many folks think of as the center of the universe. A recent tour of half a dozen LIC developments - where swimming pools and roof decks (the better to see Manhattan) are the rule - proved illuminating. The tour also revealed that some of the doorman buildings do not have personnel on duty 24 hours a day. Although specific addresses and building names are withheld in keeping with this column's usual practice, herewith some impressions of three of buildings as well as some recently seen listings being marketed by various brokers in Manhattan:
Manhattan
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2007 Service You Can Trust |
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The
company recorded a 0.5 percent drop in U.S. home values during
the fourth quarter of 2007 on an annualized basis, up from the
third quarter 2007 annualized rate of 1.5 percent and based both
on conventional loans for purchases and refinancings. It was the
first consecutive quarters of decline since 1982. Over the year
ending with the fourth quarter, home values appreciated 0.3 percent
on average, down from the 6.2 percent growth over the same period
a year earlier. For purchases alone, Freddie Mac found that home
sales prices fell 9.3 percent nationally during the fourth quarter
on an annualized basis; the last time a larger drop was recorded
was during the third quarter of 1972. Over the four quarters ending
in December 2007, home sales prices fell an average of 0.9 percent.
Only four states posted gains in home values during the fourth
quarter based on purchase prices: Maine, North Dakota, South Dakota
and West Virginia.
With
"stagflation" the buzzword of the month, the price
of oil rising past $100, an increase in the consumer price index,
turbulence in the stock and capital markets, and general uncertainty
in the minds of investors, the fate of New York City's residential
condominium is cloudy," the New York Sun observes. "As
thousands of condominium units are being developed across the
five boroughs, members of the banking community, brokers, and
developers have divergent views, but many see a growing divide
between the luxury market in Manhattan and some of the more speculative
projects in fringe areas." 
Real
estate experts say the development of residential rental apartment
buildings is grinding to a halt in New York City, according to
the New York Sun. Limited availability of financing, high land
and construction costs, the elimination of the 421-a program,
and limitations on tax exemption financing has led to conditions
that make building unprofitable for developers, even as the demand
for new rentals is greater than ever. "Developing rentals
is the impossible dream," the chairman of Douglaston Development,
Jeffrey Levine, said. "The ongoing strength of the condominium
market has absorbed land suitable for residential development.
That, in concert with the virtual elimination of tax bond allocations,
and the lack of liquidity in the capital market, has made it virtually
impossible to create residential rental apartment buildings."
