Items of Interest PRICES FALL, SALES PLUMMET, INVENTORY SHRINKS IN A YEAR The Manhattan market, as measured by the median sales price of re-sale apartments, fell 25.6 percent as compared with the same period last year, reports the Miller-Samuel appraisal firm. The overall number of sales was 50.3 percent below the same period last year as a result of the tightening of credit, rising unemployment and a recessionary economy. Inventory dropped 10.2 percent from the first quarter, but it remained much higher than in 2008, when it was 8.7 percent. More sellers had adjusted to the market price correction of the fall as evidenced by the decline in listing discount to 7.8 percent from 12.4 percent in the prior quarter. Buyers took advantage of mortgage rates at historic lows and price declines were less pronounced at the lower end of the market, where credit terms are less restrictive. Market share of new development unit sales fell to 27 percent of all sales, their lowest level in 18 months. The firm said that the median of $835,700 was 14.3 percent off the first quarter and 18.5 percent below the second quarter of 2008. Other second-quarter reports had median prices between $795,000 and $845,000. Miller-Samuel’s CEO, Jonathan Miller, told the New York Times that he expected the market to move sideways, getting a little worse before it gets better. Said economist Gregory J. Heym of Halstead and Brown Harris Stevens: “A lot of things are bottoming out.” A short summary of the reports is available on the Observer site, a PDF of the Miller-Samuel report can be found here, and you also can read commentary on the statistics. TIME WARNER PENTHOUSE GOES FOR HALF OF ASKING PRICE A five-bedroom, 8,300-sf penthouse at the Time Warner Center - the single most expensive apartment on the market in New York City when it came on in 2008 for $65 million, has sold for just over half that asking price, reports the Observer. Investor Gerhard Andlinger got $37.5 million for his apartment, $11.5 million less than its most recent, discounted listing price. Nothing else has sold for more than $35 million since a Fifth Avenue co-op was bought last July for $48,836,000, appraiser Jonathan Miller confirmed. Andlinger paid $25 million in March 2005 for the apartment, where the master bedroom suite includes an office, his-and-hers dressing rooms, his-and-hers bathrooms, and a gym; the 41-foot-long living room has floor-to-ceiling windows; the corner library/office is covered in red lacquer; the dining room has a view of the Hudson River; the pantry has a laundry center; and the five bedrooms have en-suite bathrooms. Common charges and real estate taxes add up $356,316 annually. A Russian tycoon bought the unit under the name Southerndown Inc. NEW YORK REMAINS BIGGEST CITY, NEW ORLEANS GROWS FASTEST New York led the nation’s cities in numerical increase during the 2007-2008 period, adding more than 53,000 residents, according to the U.S. Census Bureau. New Orleans had the seventh largest numerical growth. With 8.4 million residents, the Big Apple continued to be the nation’s most populous city - more than twice the population of Los Angeles, which ranked second at 3.8 million. Chicago, with 2.9 million, was third, followed by Houston (2.2 million) and Phoenix (1.6 million). In 2000-2008, New York City was the largest numerical gainer, adding 355,056 residents over the period. Houston, which added 268,041, was second, followed by Phoenix. Five other Texas cities made the top 25: San Antonio, Fort Worth, Austin, Dallas and McKinney. The Census Bureau provided far more detail, along with telling charts. SOME BROKERS GROW INCREASINGLY SLIPPERY As real estate brokers watch their incomes plummet in a vastly weakened market, experts tell the Real Deal that there's an accompanying increase in unethical behavior, from inflating asking prices to stealing buyers to making fake offers. While most brokers are well-behaved and cooperation is even improving on certain fronts, insiders say some agents, desperate to make deals, are committing more ethical violations. Extreme conditions such as the very hot market of a few years ago and the much slower market of today, provide a fertile environment for rule-breaking. For the sleazy details, click here. And you can access, as well, “10 Things Your Real Estate Broker Won’t Tell You” here starting Saturday, July 11. COOL NEW SITE BRINGS TOGETHER APARTMENT OWNERS BrickUnderground is a nicely designed online resource that enables New York City homeowners to leverage their collective intelligence - exchanging ideas, asking questions and getting answers about the art and science of home-owning in New York City. On BrickUnderground, the site says, “New York City homeowners can pool their intelligence on everything from tipping to renovating to resolving conflicts with neighbors to figuring out why the water stops halfway through your shower.” NEW FORECLOSURES WANE IN THE SECOND QUARTER The number of new foreclosures in New York City decreased slightly during the second quarter of 2009 from the same period of last year, says the real estate Web site PropertyShark, according to the Real Deal. There were 892 new foreclosures in the second quarter, down 7 percent from 962 in the same quarter of 2008, the report finds. However, the number of foreclosures rose 3 percent from the first quarter of this year. As in recent quarters, Queens led the city in foreclosures, up 9 percent from 492 in the same period last year. The borough also led the city in foreclosures per household, with one in every 1,270 homes scheduled for auction, or 0.079 percent. STREETEASY FOCUSES ON SECOND QUARTER APARTMENT RE-SALES
COMMISSION CELEBRATES GOOD DESIGN Founded in 1898 as the Public Art Commission, the Public Design Commission oversees nearly every detail in projects constructed by and for the city, observes the Architect’s Newspaper. On July 1, the organization conferred its Awards for Excellence in Design at a packed event at the New Museum. You can view a slide show of the 10 winners. 13 NEW YORKERS INDICTED FOR MORTGAGE FRAUD The Manhattan district attorney’s office announced the indictment of 13 people in what he called a multimillion-dollar mortgage-fraud scheme that victimized lenders and low-income homeowners, reports the New York Times. The 13 - including lawyers, real estate agents, appraisers and bank workers - were accused of participating in 19 sham real estate transactions. Each of the defendants has been charged with a handful of larceny and fraud charges, the most serious of which, enterprise corruption, could result in 25-year sentences. Prosecutors said the fraud occurred over a four-year period ending in April in Cypress Hills and East New York in Brooklyn, Washington Heights in Manhattan, in Westchester County and on Long Island. The criminal enterprise, which they said tricked lenders into issuing loans for homes whose values were artificially inflated and then had lawyers pocket some of the money, could ultimately show losses of more than $100 million. The 19 transactions that prosecutors called shams totaled $12 million. MANHATTAN RENTALS PLUNGE IN SECOND QUARTER There were 2,346 rentals in the second quarter, down 58.3 percent from the same quarter last year but up 2.4 percent from the prior quarter, according to the Miller-Samuel appraisal firm. Inventory increased 28.8 percent to 7,290 apartments from the prior year quarter, yet declined 3.1 percent from the prior quarter. Days on market nearly doubled to 83 days from 45 days, and the listing discount increased to 9.5 percent from 2.6 percent in comparison with the second quarter of 2008. There was a late-quarter surge in rental activity not attributable to seasonal trends. The average rental price was $3,839, 7.3 percent below the first quarter and 0.9 percent above the same quarter last year. The entire report is available in PDF. PERMITS FOR NEW CONSTRUCTION FALL FOR SECOND YEAR New building permits issued in the first five months of the year showed a year-over-year drop in all five boroughs for the second year in a row, according to data prepared by the Department of Buildings for the Real Deal. Citywide, permits were down 48.5 percent from the same period last year, to 720, and were down 69 percent from the first half of 2007, when the building boom was still in full force. Of the five boroughs, Manhattan saw the biggest drop from last year, with 18 building permits filed between January and May, or 72.3 percent fewer than in the same period of 2008; the total was off 71.9 percent from 2007. UNSURPRISINGLY, DO-IT-YOURSELF IS PRETTY POPULAR NOW Do-it-yourself products have emerged as the one positive trend in the otherwise moribund home-improvement business, says the Washington Post. Stores are reporting an increase in paint and flooring sales. Fertilizer and gardening tools are flying off the shelves. Home Depot reports that attendance at its in-store workshops has risen. According to a report this year by Mintel, a market research firm, 23 percent of people who took on home renovation projects did so to save money. About 16 percent reported having more time to work on their homes because they had been laid off or their hours were reduced. A VACANT HOME CAN CAUSE JUMP IN INSURANCE COSTS Insurance companies do not want to deal with unoccupied, vacant and for-sale homes, notes Tom Kelly in Inman News. Their histories indicates that these places stand a much greater risk of vandalism than an occupied home, and problems occur that are created by neglect. A slow leak in a cold, unoccupied home has a greater chance of resulting in burst pipes and subsequent dry rot than in a home that's lived in every day. If an employee is forced to relocate with little notice, put his spouse, family and belongings in a moving van and go, how long will the vacant home be covered? Many insurance companies will give 60 days for a transitional "vacant" period as long as the premiums are paid. Some states require that insurance carriers give 45 days' notice when coverage is canceled midterm. A 30-day advance is generally given for renewal notices, but companies often allow 60 days to make up for mail time and weekends. FEDS SORT OF LET BEAZER HOMES OFF THE HOOK Federal prosecutors say they won't pursue criminal charges against Beazer Homes as long as the company remains in compliance with an agreement to pay up to $50 million in restitution to homebuyers who were allegedly victimized by the builder's mortgage company, says Inman News. Beazer and its subsidiary, Beazer Mortgage, admitted to engaging in several fraudulent mortgage origination practices, prosecutors said, including keeping discount points that should have been used to provide some homebuyers with a reduced interest rate. Other homebuyers were told they were receiving a "gift" from a charity to cover their down payment when, in fact, the purchase price of the home they purchased was increased to offset the supposed "gift." NEW FBI REPORT DOCUMENTS UPSWING IN MORTGAGE FRAUD Suspicious Activity Reports (SARs) relating to mortgage fraud filings from financial institutions increased 36 percent to 63,713 during Fiscal Year 2008, says the FBI. Analysis of available law enforcement and industry information indicates the top states for mortgage fraud last year were California, Florida, Georgia, Illinois, Michigan, Arizona, Texas, Maryland, Missouri, New Jersey, New York, Ohio, Colorado, Nevada, Minnesota, Rhode Island, Massachusetts, Pennsylvania, Virginia, and the District of Columbia. Rhode Island, Massachusetts, Pennsylvania, and the District of Columbia were new to the list in 2008, replacing Utah, Indiana, Tennessee and Connecticut from 2007. LATE MORTGAGE PAYMENTS REACH 5.65 PERCENT IN MAY The number of mortgages that were 60 days or more late reached 5.65 percent, the highest level on record and up from 5.48 percent in April, according to the Hope Now Alliance, says the Wall Street Journal. Foreclosure starts surged after pausing earlier this year as various states and lenders held back foreclosures through various moratoria. Some 257,000 homes entered the foreclosure process, up 5.7 percent from April and 34 percent from one year ago. Subprime foreclosure starts fell by 16 percent from one year ago, but prime foreclosure starts jumped by 83 percent. Housing analyst Ivy Zelman notes that an “incremental weakening in prime mortgages are likely to result in a pick-up in higher-priced foreclosures hitting the market in late 2009/early 2010.” RATES CONTINUE TO SLIDE The 30-year fixed-rate mortgage (FRM) averaged 5.20 percent for the week, down from last week’s 5.32 percent and last year’s 6.37 percent, according to Freddie Mac. It was the second consecutive week of decline, slipping to the lowest level in six weeks. The 15-year FRM this week was 4.69 percent in comparison with 4.77 percent last week and 5.91 percent last year. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.82 percent this week versus 4.88 percent a week ago and 5.82 percent a year ago. One-year Treasury-indexed ARMs were 4.82 percent, down from last week’s 4.94 percent and last year’s 5.17 percent. HOUSING BOOSTS RECORD CONSUMER LOAN DELINQUENCIES
DURING A SHORT WEEK, LOAN VOLUME SHOT UP The Mortgage Bankers Association (MBA) reports that mortgage loan application volume increased 10.9 percent on a seasonally adjusted basis for the week ending July 3 from one week earlier. On an unadjusted basis, volume was off 0.5 percent compared with the previous week but up 7.2 percent compared with the same week one year earlier. Refinancings rose 15.2 percent from the previous week, purchase applications went up 6.7 percent. The refinance share of mortgage activity grew to 48.4 percent of total applications from 46.4 percent the previous week, and the adjustable-rate mortgage (ARM) share inched up to 4.4 percent from 4.3 percent. APPEAL SWELLS OF GOVERNMENT-INSURED LOANS The government-insured (FHA and VA loans) share of mortgage applications was 35.9 percent last month, the highest level since November 1990, according to the Mortgage Bankers Association (MBA). The government-insured share jumped from 25.7 percent a month earlier and 27.0 percent in June 2008. Since the MBA survey’s inception in January 1990, the lowest recorded share was 5.8 percent in August 2005. The government-insured share of purchase applications has averaged 36.6 percent to date in 2009 in comparison with an average of 21.8 percent during the same period in 2008. The low point was in August 2005, when it was 6.8 percent. “A primary reason government-insured loans have retained a high share of the purchase market is that these loans typically require lower down payments than conventional loans,” said Orawin Velz, MBA’s associate vice president of economic forecasting. “In addition, lending standards tend to be tighter for conventional loans, especially for loans that require private mortgage insurance.” OLDER AMERICANS ARE THE LIKELIEST ENTREPRENEURS Contrary to the stereotype of 20-somethings starting Web-based businesses in their basements, U.S. News & World Report says baby boomers actually embody the entrepreneurial spirit best. The magazine says the following cities are the best for entrepreneurs to “retire:” Arlington, Va.; Columbia, Md.; Fargo, N.D.; Fayetteville, Ark.; Fort Collins, Colo.; Knoxville, Tenn.; Lincoln, Neb.; Madison, Wis.; Round Rock, Tex.; and West Des Moines, Iowa. Over the past decade, the highest rate of entrepreneurial activity was among people between the ages of 55 and 64, according to a recent study by the Kauffman Foundation. Individuals between 20 and 34 were the least likely to start businesses. Dane Stangler, a senior analyst at the Kauffman Foundation and author of the study, thinks that the number of baby boomers starting businesses during the traditional retirement years is likely to soon, well, boom. There’s much more information in the magazine. REITS SURGE AS PERCEPTIONS OF THEIR JEOPARDY DIVE Real-estate-investment trusts staged the best performance in their history during the second quarter on growing perceptions that most REITs are out of immediate danger, says the Wall Street Journal. The Dow Jones Equity All REIT Total Return Index, which tracks 114 publicly traded REIT stocks, rose 28.9 percent in the April-June period, the biggest quarterly gain for the index since it debuted in 1989. All but five of the REITs in the index posted gains, and seven companies had returns that exceeded 100 percent. "The fear of REITs going to zero is clearly far less today," said Alexander Goldfarb, an associate director who covers REITs at Sandler O'Neill + Partners. Still, while the second-quarter gains were significant, they didn't reverse the deep drops real-estate stocks have suffered since last year. The Dow Jones REIT index was down 31.6 percent in the first quarter of this year and 38.8 percent in the fourth quarter of last year. WHAT HAPPENS THERE STAYS FIRM, DEVELOPER SAYS One of the costliest and highest-profile condominium developments in the country - the $8.4 billion City Center project in Las Vegas - is facing a revolt from some early buyers, says the Wall Street Journal. Some buyers who signed contracts are demanding significant price reductions and have hired a law firm to take their grievances to the project's principal developer, gambling company MGM Mirage. Others want their deposits back. Some are using a Web site to air their grievances. So far, buyers have put down $313 million in deposits on 1,500 units in the 2,440-unit complex. Many of the contracts were signed in 2006 and 2007, when Vegas was booming. MGM Mirage said it isn't offering discounts to current buyers, many of whom bought during a special promotion period for "friends and family" of MGM Mirage. In Las Vegas, home-sale prices are down more than 30 percent from a year earlier. EVEN NEW YORK CITY HAS A CHEAPER COMMUTE THAN TOKYO The ride on a bus or subway in Tokyo costs $3.25, notes Forbes. Grab a newspaper and a cup of coffee on the way and the total comes to $11.70. That's more than anywhere else in the world – 24 percent more than what those same things cost even in New York, which jumped from No. 22 to No. 8. Tokyo is the world's most expensive city, according to Mercer's 2009 Worldwide Cost of Living survey. In Tokyo, the cost of living is up 13.1 percent from 2008, according to the newly released survey; the city ranked at No. 2 in 2008's survey. Japan's capital is followed by Osaka and Moscow, which held the top spot in last year's rankings. Geneva comes in fourth. London dropped to No. 16 from No. 3. Other notable leaps from last year's ranking to this year's are Dubai, which moved to No. 20 from No. 52, and Caracas, to No. 15 from No. 89. All U.S. cities included in the ranking also experienced a rise, including Los Angeles, up 32 places, and Washington, D.C., up 41 places. For more about costly cities, click here. LIMITED INSURANCE PROTECTION OFFERED AGAINST JOB LOSS Job-loss mortgage insurance is available from a host of sources with varying coverage, cost, benefits and requirements, observes Broderick Perkins in Realty Times. The insurance pays your mortgage when you lose your job - to a point. Typically paid directly to the lender, policy benefits can cover principal, interest, taxes and insurance, if all items are included in the original mortgage payment. For details, including policy limits and strict eligibility standards, click here. LIONS AND TIGERS AND. . . GIRAFFES! OH, MY! A Bay Area businessman is offering a wildlife preserve of 74,490 acres (about 116 square miles) in southeastern Kenya for $10 million, says the Wall Street Journal. The preserve, about 93 miles west of the coastal city of Mombassa, is sandwiched between two national parks and is home to 53 large mammal species including elephants, lions, buffalo and giraffes. There are three airstrips and a small eco-tourism lodge. The seller, Mike Korchinsky of Stinson Beach, Calif., founded and then sold a management-consulting company in 1995 to Cambridge Technology Partners. He founded conservation group Wildlife Works in 1997 and through a trust bought the Kenya property, then a failing cattle ranch. He hired a local staff to help restore and manage the reserve. Within three years, the wildlife started coming back. “We’re looking for a conservation-minded buyer, an individual or a family that would use it for personal reasons,” Korchinsky says. For. . . hunting? BUDDY, CAN YOU SPARE A FAN The 19th-century French château once belonging to actress and entertainer Josephine Baker is now on the market for $16.3 million, according to the International Herald Tribune. The 10-bedroom home, Le Beau Chêne, is about 15 minutes outside of Paris and contains 6,500 square feet of living space plus approximately 3.7 acres of gardens. Baker bought the home in 1929 from Anna, countess of Noailles, and lived there for 18 years before selling it to the parents of the present sellers in 1947. Among other of Baker's visitors was Mohammed V of Morocco. The château's amenities include a tennis court, a swimming pool, garden room with a fountain and huts for raising animals. HE’S LEAVING THE MUSEUM TOWER Last November, Nicolas Cage put his 3,550-sf, 48th-floor, five-bedroom, two-unit apartment in the Museum Tower on the market for exactly one day, says the Observer. The $9.75 million condo was pulled once a reporter called the actor's broker to ask about it. Eight months later, his apartment is back on at the same price. The master bathroom, which has a tub and steam shower, has a surfeit of lights and what seems to be some kind of bright black marble; the 32-foot-long living/dining room has two Eames Lounge Chairs on a very shaggy white carpet; and there's a long glass table topped with what seem to be glass figurines of two skyscrapers and the Statue of Liberty. There also is a full wet bar off what's listed on the floor plan as the play room, though the listing describes it as a "sitting area." FROM THE DEPARTMENT OF THE WAGES OF SIN
DON’T CRY FOR HER, MANHATTAN Two deeds filed in city records show that Madonna's new mansion officially cost $32 million, reports the Observer. She bought the 12,000-sf house last month through a limited liability company. It’s a double-wide, featuring a 38-foot-wide drawing room overlooking a garden; a formal dining room off a garden terrace; three pantries and two kitchens; two libraries and a sitting room; a parlor-floor dry bar and a “wine cellar/grotto” in the basement; and, of course, a gym. There are no mortgage records filed along with the deeds, which suggests that she paid all cash. Considering that the East 81st Street mansion was originally listed for $45 million, the deal is a bargain. INDEX FINDS MODERATING RATE OF PRICE DECLINES The S&P/Case-Shiller Home Price Indices, which omit apartments, decreased approximately 18 percent in April from one year earlier. These declines compared with March’s 8.7 percent. For the past three months, the 10-City and 20-City Composites have recorded an improvement in annual returns. The January data had a 19.4 percent drop for the 10-City Composite and 19.0 percent for the 20-City Composite. “The pace of decline in residential real estate slowed in April,” said David M. Blitzer, chairman of the Standard & Poor’s Index Committee. Thirteen of the 20 metro areas also saw improvement in their annual return compared with that of March, and every metro area except Charlotte recorded an improvement in monthly returns over March. “While one month’s data cannot determine if a turnaround has begun, it seems that some stabilization may be appearing in some of the regions,” Blitzer added. “We are entering the seasonally strong period in the housing market, so it will take some time to determine if a recovery is really here. The stock market bottomed in March and measures of consumer confidence have turned upward. This report shows that these better spirits are also appearing in the housing market." CONTRACTED SALES RISE IN MAY, BUT CLOSINGS COULD DRAG The Pending Home Sales Index increased 0.1 percent to 90.7 from an upwardly revised reading of 90.6 in April, according to the National Association of Realtors, which warned that new appraisal rules could delay settlements. May’s index was 6.7 percent higher than one year earlier and marked the fourth consecutive monthly gain since October 2004. 22-YEAR HIGH IS REACHED FOR APARTMENT VACANCIES The vacancy rate for U.S. apartments hit a 22-year high in the second quarter as rising unemployment reduced demand during what is usually the peak leasing season, according to a report cited in the Wall Street Journal. Rents fell the fastest in markets that have shed white-collar jobs, such as New York and San Jose, Calif., and in markets where many foreclosed homes and condominiums have been turned into rental property, including Las Vegas and Orange County, Calif. Vacancy levels nationally rose to 7.5 percent in the April-to-June period, up from 6.1 percent from a year earlier, according to Reis Inc., a New York real-estate research firm. Of the 79 markets tracked by Reis, 45 showed an increase in vacancies. Rents are falling at the fastest pace in at least a decade. Effective rents, including landlord concessions, fell 1.1 percent in the first quarter and 0.9 percent in the second quarter to an average of $975 a month. The combined decline for the first half of the year was the largest since Reis began tracking the data in 1999. New York City posted a 12-month decline in price of 5.8 percent to an average of $2,680, the biggest drop among the 79 markets. Markets with better employment prospects saw modest rent growth during the second quarter. Effective rents increased in the second quarter by 0.3 percent in suburban Maryland and in Washington, D.C. BYE-BYE McMANSIONS, HELLO PROPERTY UPGRADES The recession and a renewed interest in lowering utility costs are responsible for a growing demand for smaller sized homes in recent years, according to survey by the American Institute of Architects (AIA). “The era of the ‘McMansion’ could well be over as home sizes have been trending downward recently, with a significantly higher number of architects reporting demand for smaller homes this year,” said AIA Chief Economist Kermit Baker. “And as the housing boom has passed, there seems to be a renewed interest in investing in properties to make homes more livable, as opposed to real estate that can be resold quickly for a profit.” Among other findings, there has been an adjustment in the volume of living space with a preference for lower ceilings and a diminished interest in two-story foyers. But property upgrades are extremely popular with households trying to maximize their usable space with finished attics and basements, outdoor living enhancements and blended indoor/outdoor features. Accessibility within the home continues to be a concern, especially for an aging U.S. population. UNSURPRISINGLY, SURVEY SAYS BUYERS SEEK BARGAINS Approximately 10 percent of today’s home owners say they have delayed selling their home because of the housing slump, according to a new survey by the seriously interested Realtor.com. And nearly one of five prospective buyers (19.6 percent) say foreclosure bargains in their communities would motivate them to purchase a home. An additional 15.5 percent said they’re motivated to buy soon because they think prices are as low as they will go, and another 15.5 percent said they’re motivated to buy before interest rates rise. For 14.6 percent of first time home buyers, the Federal $8,000 tax credit is the impetus to purchase a new home in the future. The greatest barriers to homeownership today, according to survey respondents, are concerns related to employment and the ability to make mortgage payments, especially among those ages 25-34 (31.1 percent) and 35-49 (30.8 percent). BARCLAYS SAYS FORECLOSURES WILL PEAK A YEAR FROM NOW U.S. foreclosures will peak in the second half of 2010 and home prices will continue to decline through the end of that year, says Barclays Capital, according to Bloomberg. “Home prices are likely to continue to fall, albeit at a slowing pace, even after the economy technically emerges from the recession,” Michelle Meyer, an economist at Barclays Capital in New York, said in a report. Prices may drop another 7 percent, she said, based on the S&P/Case-Shiller home price index of 20 U.S. cities. Home re-sales probably will rise to 5.41 million next year from 4.75 million in 2009, the economist said. Sales of new houses may increase to 440,000 next year from 350,000 this year, she continued. That would make 2009 the lowest year for new-home sales in Census Bureau records, which started in 1963. “The slowing in the economic recession, with fewer job cuts and greater consumer confidence, along with improvement in financial conditions, should help support home sales,” Meyer wrote. INVESTMENT ADVISORY FIRM PREDICTS MID 2010 BOTTOM
FORECASTER ENVISIONS LOWER PRICES INTO 2011 PMI Mortgage Insurance projects in its latest report that as many as 324 - approximately 85 percent - of the nation's 381 MSAs (Metropolitan Statistical Areas) face increased risk of lower home prices in 2011. Florida, California, Nevada and Arizona continue to have the highest risk scores, but an increased risk of lower future prices is now spreading across the nation because of significant increases in unemployment and foreclosure rates, the report says. Among the nation's 50 most populous MSAs, 28 are now in the highest risk category, signifying the greatest probability of lower house prices by the first quarter of 2011, relative to the first quarter of 2009. The most stable of the top 50 were Cleveland-Elyria-Mentor in Ohio and Pittsburgh. The whole report is available in an impressive new interactive format. Visions of Silestone Don't Dance in Their Heads In the old days, nothing energized prospective buyers more than the chance to impose their vision on their new homes, even if those apartments and townhouses had just been updated. Tear down those walls! Buy an even bigger Sub-Zero! Install built-in bookcases! Refinish the floors! Re-do the baths! No matter the condition of those purchases, they wanted the properties to reflect their own personality, taste, needs and aspirations. Thus, places that “needed work,” as the phrase goes, particularly resonated with such purchasers. They were eager to pay the carrying costs of two residences while work was done, put up with the inevitable frustrations of dealing with contractors, and spend and spend and spend to their heart’s delight. They were flush with cash, filled with notions of modern design, and fated to go way over budget. Those were the olden times of a couple of years ago, and those times now are long gone. Today’s buyers tend to be watching their wallets, newly sobered by several concerns. One, they are worried about the economy and its affect on their assets. Two, they are worried about their jobs. Three, they are worried about how little of the cost of renovation they might eventually recoup upon re-sale. Four, they are still worried about their jobs. Five, they are worried about their jobs. They have good reason for their concerns, especially when the current housing market means few of the sellers who undertook serious renovations in the last few years rarely get their money back. Some even have to bring money to the settlement table. That said, an apartment in the high 90s between Broadway and Amsterdam Avenue is an example of a property that has languished on the market. It urgently demands a renovation by the next owner. This co-op “needs work.” A lot of work. It gives punny new meaning to “homemade.” Apparently, whoever undertook to renovate the apartment did so with his or her own hands – a seeming do-it-yourself project that went awry. For example, there are copious amount of wood paneling, wooden doors, wooden doorways and wooden windows. All the wood has been inexpertly stripped, leaving incomplete patches of paneling and seems. What is supposed to be charming is merely chastening about the work still needing to be done. Actually, it’s pretty ugly. The kitchen renovation is frighteningly ham-handed, less because of the quality of the work than because of the quality of the design. Appliances jut from the counters, the oak cabinetry is reminiscent of an overbuilt suburban subdivision and a laminate countertop meant for dining intrudes into the narrow kitchen. Moreover, a square opening has been poked high through a wall incongruously in an attempt to provide additional light to the bedroom beyond. The skinny bedroom, which seems to have been divided from what was a studio, can use the extra light. One awkward feature of the room is that only by crossing the “chamber” can anyone reach the bath. As for that shabby bath, the tub is about three-quarter-size, of the sort commonly found in the maid’s rooms of pre-war apartments. So, yes, entertain your vision of sleek and sophisticated if such a project floats your boat while others retreat to dray land. Gather screwdriver, steel wool and your hammer to see all you can do with this minimal space, which is listed somehow at $459,000 with maintenance of $527, down from its original $579,000 in the good old days – April of 2008. Meantime, have a look below at recently seen properties that are listed by various brokers:
Some of Manhattan's Latest Listings Please click here to view a sampling of newly listed properties. To see more of them or to obtain more information, please don't hesitate to be in touch. Click Here to Sign Up For Your Free Issue of Realty Digest!
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Condo and co-op re-sale median prices have increased since the last quarter but are down significantly from a year ago, StreetEasy.com reports. “These increases may reflect the highly seasonal nature of the real estate market as there is typically more activity during the spring season,” notes 
Installment loans more than 30 days late reached a record 3.23 percent in the first quarter, according to the American Bankers Association (ABA). Reflecting continued weakness in the housing sector, delinquencies for the home equity category also hit record highs. Home equity loan delinquencies rose to 3.52 percent of accounts, and home equity lines of credit delinquencies rose to 1.89 percent of accounts. “Even if home prices stop falling later this year, unemployment will keep home equity delinquencies high for some time,” ABA Chief Economist JamesChessen commented. 
Ruth Madoff left her Upper East Side penthouse for the last time a couple of weeks ago, walking out with "just the clothes on her back," authorities said, according to the New York Post and too many other news media. Estimates of the apartment’s value exceed $7 million. Meantime, disgraced lawyer Marc Dreier's apartment at One Beacon Court, between Lexington and Third avenues and 58th and 59th streets, is expected to be auctioned off on July 21. Dreier's 7,000-sf home, which he bought for $10.4 million two years ago, will be auctioned with no starting bid. The auction company sold Dreier's two Southampton properties last month. As for Madoff, the wife, it was not disclosed where she is living. (Her husband’s accommodations for the next 150 years have been arranged.) A number of Manhattan buildings have refused to rent to her, and a rumor has been floated (and denied) that she’s trying to buy a tiny condo in the East 90s. The possessed apartment's pricey contents, which include a Steinway piano valued at about $39,000 and a set of silverware valued at about $65,000, are expected to be auctioned by the government. 
Based on the Case-Shiller national index, which omits apartments, T2 Partners says housing prices will level off at 40 percent from the peak, another 5-10 percent from the end of the first quarter this year. “It’s almost certain that prices will reach these levels,” the company contends. T2 Partners adds that a “key question” is whether prices will crash through the trend line and fall well below fair value. “Unfortunately, this is very likely,” the firm says. “In the long term, housing prices will likely settle around fair value, but in the short term, prices will be driven both by psychology as well as supply and demand.” Because of those two considerations, the firm says that not only does it expect prices to fall up to 50 percent from the peak but also that “there will be no quick rebound.” 
