DO YOU WANT LIVE IN RIVERDALE OR QUEENS If so, you may well get a great deal in two separate auctions announced over the weekend. One on Nov. 22 is of 54 unites in the Solaria, a 20-story condominium on W. 237th Street in Riverdale with starting bids at less than half the listing prices. The second auction, on Nov. 10, is of estate-owned Queens properties with upset prices between as low as $56,000. For details, check out the Service You Can Trust blog. And if you fancy the Madoffs’ belongings, have a look at this blog item. POPULARITY OF ‘WHISPER LISTINGS’ IS GROWING "Whisper listings" - properties that are for sale, but not officially on the market - are becoming more common, according to the Real Deal. Motivated by the desire of sellers to avoid the perception that they are unloading properties because of financial distress, the also are known as "quiet listings." Often, they are among the most expensive properties in the city. Some sellers are asking that addresses, prices and pictures of their homes not be posted on brokers' Web sites and that agents not co-broke or even advertise their listings. That leaves brokers with the difficult task of selling these homes while adhering to strict privacy standards. And it diminishes the likelihood that sellers will get the best price. There’s more on this subject in the Service You Can Trust blog. RENTS ARE GENERALLY DOWN BUT, IN TRENDIEST AREAS, UP Rents, which generally decrease in the fall, were relatively flat last month, but the Real Estate Group of New York reports that prospective tenants seemed to be pushing up prices in trendy neighborhoods such as SoHo and TriBeCa. On average, Manhattan rents were off approximately a half percent from September, and supply was rising again. Inventory in Manhattan went up 1.72 percent, posting the first significant increase in vacancies in six months. The biggest month-to-month change was in doorman studio units, which increased 2.09 percent. You’ll find much more on the report in the Service You Can Trust blog. LITTLE BROTHER IS CHECKING YOU OUT Co-op and condo boards are now conducting increasingly extensive, and often costly, background checks of prospective buyers, observes the Real Deal. The investigations include everything from reviewing litigation history - to see whether the buyer has been involved in a lawsuit - to searching sex-offender registries. And to make sure prospective neighbors are properly vetted, more boards are now hiring private detective agencies. Andrew Harris, CEO of Manhattan-based investigative firm Bishops Services, said he's seen an uptick in business recently from residential buildings and that clients are now requesting more in-depth searches. In the last 24 months, residential business has increased “rather dramatically as people have become more sensitive to really knowing who is moving in next to them," Harris related. Fees vary per applicant, often around $700, an expense borne by buyers, who must consent to the background check being performed. IN A CITY OF 8 MILLION SOULS, MORE THAN HALF LIVE ALONE More than half of all Manhattan residents are living alone, 50.3 percent, and the number of singles in the city is continuing to rise to historic levels, new Census Bureau data show, according to the New York Post. (See items in Research below, too.) William Helmreich, deputy chairman of City College's sociology department, says high-paying jobs, the expense of raising a family, longer-living widows and widowers and, of course, a celebrated culture of singledom, feed the trend. "Singles attract more singles," he avers. "They participate in a lifestyle that is mutually reinforcing.” There were some 212,000 women and 165,000 men living alone, according to the Census data. THOSE DENIZENS OF WALL STREET MUST BE CELEBRATING Bonuses could be the biggest industry-wide since 2007, at the height of the bubble, according to a new study by the pay consultant Johnson Associates cited by the New York Times. Its annual report projected that the financial industry payouts would be up 40 percent from 2008, when Wall Street handed out nearly $20 billion in cash awards and billions more in stock and other incentives to employees based in New York. A typical senior fixed-income trader can expect a total pay package of about $930,000 in cash and stock compared with a package last year of approximately $695,000. Paychecks for stock and derivatives traders are likely to jump by half that much. Bonuses for investment bankers, by contrast, are projected to go up 15-20 percent. RENOVATION COSTS HAVE DROPPED Depending on the region and the job, some homeowners are paying as much as 20% less for home-remodeling projects than they would have a few years ago, notes the Wall Street Journal. Many contractors are willing to accept smaller jobs and "handyman" projects that they used to snub. And more projects are being delivered on time and on budget. In the year ended the first quarter of 2009, the most recent data available, $118.2 billion was spent on home-improvement projects, down from $146 billion in the year ended the third quarter of 2007, according to a report issued last month by the Harvard Joint Center for Housing Studies. The center said it expected spending declines to moderate through the end of this year and begin to rise early next year. REMODELERS REPORT SLIGHT IMPROVEMENT IN THEIR MARKETS Although residential remodeling remained relatively weak during the third quarter of 2009, remodelers are starting to report that conditions in their markets are stabilizing, according to the latest National Association of Home Builders' (NAHB) Remodeling Market Index (RMI). The current market conditions index rose slightly to 39.8 from 38.1 in the second quarter. The index of future indicators jumped to 38.7 from 34.2 in the previous quarter. This was the third straight quarter of improvement, but both indices remain well below the break-even point of 50. "Remodelers are no longer reporting markets deteriorating to the same degree as earlier in the year, but credit and financing of remodeling jobs remains a huge hurdle to overcome in closing sales," said NAHB Chief Economist David Crowe. "Inaccurately low home appraisals also hurt remodelers, because they hamper both home equity loans and sales of existing homes that often stimulate remodeling." IMPROVING ENERGY EFFICIENCY CAN BRING TAX BENEFITS If you're planning to improve your home's energy efficiency, 2009 and 2010 are great years to do so, observes the Washington Post. The American Recovery and Reinvestment Act of 2009, or "stimulus bill," which was signed into law earlier this year, extended the eligibility period for energy-efficiency tax credits that already were expanded under 2008's "bailout bill." Many products - including windows and doors, roofing, insulation, and indoor heating and cooling systems - are covered. The purchase of some renewable-energy systems and products will have tax benefits through 2016. Find out here what you can claim. DON’T LEAVE HOME WITH IT “It” would be the knowledge that your door is locked securely. If you have been burglarized once, the likelihood of it happening again increases, according to the New York Times. Says retired FBI agent Gregg McCrary, a security consultant in Fredricksburg, Va.: “We don’t know why, but if you’ve been burglarized before, then the chances of getting re-victimized are higher, and you want to think about upping security a bit.” The easiest way to deter an intruder is with a deadbolt lock on the door. Expect to spend $40-50. But cheaper, mass-marketed deadbolts are easy to force open, according to Howard Nevitt, the owner of Ravenna Locksmith in Seattle. “A lot of times, when the label says ‘fortress’ or ‘faultless’ or ‘defiant,’ they’re easy to pick, and the strength of the bolt isn’t very strong,” he notes. “The bottom line is, you get what you pay for.” Their whole article is well worth reading in the safety of your home RATES DIP BELOW 5% ONCE AGAIN The 30-year fixed-rate mortgage (FRM) averaged 4.98 percent this week, down from last week’s 5.03 percent and 6.20 percent last year at this time. The 15-year FRM was 4.40 percent from last week, when it averaged 4.46 percent; a year ago, it was 5.88 percent. The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) slipped to 4.35 percent this week from last week’s 4.42 percent and last year’s 6.19 percent. The one-year Treasury-indexed ARM averaged 4.47 percent in comparison with 4.57 percent the previous week and 5.25 percent a year earlier. BANK SAYS MORE HOME-EQUITY BORROWERS ARE ON TIME In the third quarter, Bank of America saw a $146 million drop in home equity loans on which customers were more than 90 days late in payments, according to USA Today. Chief Financial Officer Joe Price said it was the first decrease since the start of the credit crunch. REFINANCING APPLICATIONS RISE, BUT PURCHASES DECLINE The Mortgage Bankers Association says loan application volume was 8.2 percent higher for the week ending Oct. 30 than the earlier week on a seasonally adjusted basis. On an unadjusted basis, the increase was 7.9 percent. There were 14.5 percent more refinancings for the week ending Oct. 23 than in the previous week, but purchase activity fell 1.8 percent on a seasonally adjusted basis. Mortgage applications for purchase dropped 3.0 percent; they were 3.4 percent lower than the same week one year ago. The refinance share of mortgage activity increased to 66.1 percent of total applications from 62.3 percent the previous week, and the adjustable-rate mortgage (ARM) share slipped to 6.1 percent from 6.9 percent. TAX CREDIT IS EXPANDED AND EXTENDED FOR HOME BUYERS A new law allows people buying a home for the first time in three years to receive an $8,000 tax credit if they sign a contract by April 30 and close by June 30, reports the Washington Post. Homeowners who are buying a new primary residence would be eligible for a $6,500 tax credit beginning Dec. 1 if they owned their home for five consecutive years in the previous eight. To qualify, the home must be no more than $800,000. The program also restricts eligibility to individuals who make no more than $125,000 annually and couples who make more no more than $225,000. Anyone who collects the tax credit but sells the home within three years of buying it must return the refund. The original tax credit was to expire Nov. 30. Some economists worry that the program distorts the market by artificially inflating home prices and are skeptical about whether the amount of additional economic activity is worth the cost, estimated at $10.8 billion. "The housing market is going to have to learn to stand on its own two feet," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. MacGuineas. "This could misdirect resources into the wrong place." FORBES RANKS NYC METRO AREA AMONG SAFEST, LESS TOXIC Minneapolis tops the magazine’s list of America's safest cities. In ranking cities, Forbes accounted for workplace fatalities, traffic-related deaths, crime rates and natural disaster risk. The Milwaukee metro area was second. And the Portland, Ore., metro area, which boasts the lowest crime rate, was third, with Boston and Seattle tied for fourth. Of the 40 regions studied, New York was in eighth place, somehow despite 9/11. Miami had the dubious distinction of being among the six worst in all of the Forbes categories. To see all the cities and more on the magazine’s rationale, visit Forbes. In another of its endless lists, Forbes says Atlanta’s combination of air pollution, contaminated land and atmospheric chemicals makes it the most toxic city in the country. Detroit, Houston, Chicago, Philadelphia, Cleveland and Los Angeles are right behind it. The Washington, D.C. area was No. 23 on the list, and the New York region, 31. For additional information, go here. THE TIMES CHRONICLES THE FRUITS OF OVER-PRICING Even in the best of times, it’s hard for individuals to objectively value their homes, says the New York Times. Making things even more difficult has been general market inactivity lately, if not paralysis, which has provided little in the way of pricing guidance, the article continues. But by using online resources, investigating neighborhood trends, consulting real estate experts and perhaps even asking the opinions of brutally honest friends, homeowners can arrive at a reasonably accurate appraisal even in these uncertain times, according to the Times. You'll find much more, along with cautionary advice in the Service You Can Trust blog. WITH PRICES RISING, DUBAI PROPERTIES ARE STILL A BARGAIN Dubai property prices rose in the third quarter for the first time since the emirate's property market crashed late last year but were 47 percent lower than a year earlier, according to real estate consultancy Colliers International, says the Wall Street Journal. Prices increased 7 percent between July and September from the second quarter; it was the first price increase since the market fell from its peak in the third quarter of 2008. The number of market transactions rose 64 percent during the third quarter of 2009. AN ISRAELI COMPANY IS SNAPPING UP U.S. CONDOS Dizengoff Group, a family-owned commodity-trading and real estate company based in Israel, bought 118 condominium units in September in a complex called Portofino in Jensen Beach, Fla., according to the Wall Street Journal. The total price was $6.75 million, or $53 per square foot, compared with an average price of $204 when the units were offered by the developer in 2006, says Ronen Saban, the manager of Dizengoff’s office in Boca Raton, Fla. The company plans to rent out the units until the market recovers. Dizengoff is looking for more purchases in good locations and aims to buy at less than replacement cost. IF HIS HOUSE WERE MUSIC, THIS COULD BE THE CODA Metallica guitarist Kirk Hammett has put his on-again, off-again San Francisco mansion back on the market, according to the Wall Street Journal. The listing price is just under $9 million, down nearly 30 percent from the $12.5 million asking price in 2005. Hammett, 46, paid $2.56 million for the gated Georgian-style home in 1993. The Pacific Heights residence measures some 9,000-square-feet and has eight bedrooms and eight baths. There's a music studio and a billiard room with a bar in the basement. The property includes a two-car detached garage and additional parking in the driveway, which, in San Francisco, is even more necessary than Irish coffee at the Buena Vista. J.P. MORGAN HAD A POINT Virginia winemaker and philanthropist Patricia Kluge is offering her 300-acre English country estate in Charlottesville, Va., for $100 million, reports the Wall Street Journal. Kluge, 61, is the former wife of John Kluge, the billionaire founder of the Metromedia broadcast and cellphone empire. Her estate, in the rolling foothills of the Blue Ridge Mountains near Thomas Jefferson's Monticello, includes a 45-room neo-Georgian main house of 23,538 square feet with eight bedrooms and 13 baths. Completed in 1985, the home has a theater, library, recreation room with spa and sauna, a card room and an Islamic gallery featuring an antique Syrian fountain. The property includes a pool, pool house, log cabin, a greenhouse and several staff cottages. There are three stocked ponds, gardens and a croquet lawn. The front grounds can be converted to an 18-hole golf course, for which designs by Arnold Palmer are available. AT 97, SHE’S STILL LOOKING AHEAD Louise Bourgeois, the French-born sculptor, lives in her 15-foot-wide town house on West 20th Street, notes the New York Times. Now Bourgeois will have some additional elbow room. Property records show that a private foundation financed by her bought the equally narrow town house next door, on 20th Street between Eighth and Ninth Avenues, for $4.75 million late last month, just before the house was to be listed. The seller was William Ivey Long, a costume designer for Broadway productions who won Tony Awards for his work on “Crazy for You,” “The Producers” and “Hairspray.” Long had renovated the house, which dates to the 1860s, and decorated the interior in a Victorian style. It was not disclosed what outfits he favors at home. ARS GRATIS ARGENT Sonia Sotomayor lives now in the nation's capital, but she isn't pulling up stakes in Greenwich Village just yet, says the New York Daily News. In her view, the housing market is too soft to put her apartment on the block. "Right now I - like many other Americans, it would not be wise for me to sell my home in New York because the market is so low," Sotomayor told C-SPAN in a recent interview. Sotomayor owes approximately $380,000 on her Greenwhich Village apartment, which, she told the U.S. Senate during her confirmation hearing, was worth $1 million. HE PLACES ONE BET ON IDAHO Steve Wynn, who owns another hovel in Manhattan, has bought a 5,500-sf one-story log-sided home in Ketchum, Idaho, with three bedrooms and three baths, says the Wall Street Journal. Wynn, 67, and his wife Elaine, 65, are in the process of divorcing for a second time. The couple was married in 1963, divorced in 1986 and remarried five years later. Wynn's new home sits on about two secluded acres near Big Wood River and overlooks 17 acres of horse pasture owned in common by Wynn and his neighbors. The property also has an attached guest house with three bedrooms and three baths. SIGNED CONTRACTS SURGE 6.1% FROM AUGUST TO SEPTEMBER Pending home sales rose again, marking eight consecutive monthly gains and the longest streak since measurement began in 2001, according to the National Association of Realtors (NAR). The year-to-year 21.2 percent gain in the Pending Home Sales Index is the biggest annual increase on record, reaching the highest level since December 2006. NAR Chief Economist Lawrence Yun attributed the jump to “a rush of first-time buyers trying to beat the expiration of the tax credit at the end of this month.” (See first item in Et Cetera above.) He added: “Although the tax credit is greatly reviving the existing home market, new-home sales may continue to struggle as home builders hold back production to drive down inventory. In addition, there remains an ongoing credit crunch for construction loans.” SALES OF PREVIOUSLY OWNED HOMES HIT TWO-YEAR HIGH Existing-home sales rebounded strongly in September, with first-time buyers driving much of the activity, according to the National Association of Realtors (NAR). It was the fifth gain in the six months. Including single-family, townhomes, condominiums and co-ops, sales jumped 9.4 percent over the August level. Sales activity was at the highest level in more than two years. CASE-SHILLER SAYS PRICES NOW AVERAGE LEVELS OF 2003 The Case-Shiller Home Price Indices, which omit apartments, show that the annual rate of decline of the 10-City and 20-City Composites improved in August compared with July. August was approximately the seventh month of improved readings, beginning in early 2009. The 10-City and 20-City Composite Home Price Indices posted decreases of 10.6 percent and 11.3 percent, respectively, from the same month last year. Nineteen of the 20 metro areas in each index showed an improvement in the annual rates of decline from July to August. Cleveland was the only exception. As of August 2009, average home prices across the United States were at levels similar to where they were in the autumn of 2003, according to the report. From the peak in the second quarter of 2006 through the trough in April 2009, the 10-City Composite was down 33.5 percent and the 20-City Composite, down 32.6 percent. With the relative improvement of the past few months, the peak-to-date figures through August 2009 were -30.2 percent and -29.3 percent, respectively. New York was off 9.6 percent year to year in August. For more on the Case-Shiller statistics, including charts and comments, visit the Service You Can Trust blog. FEDERAL INTERVENTION IN HOUSING HAS SENT PRICES HIGHER So estimates Goldman Sachs, which pegs the increase at 5 per cent more on a national average than they would have been otherwise, according to the Wall Street Journal. “The risk of renewed home-price declines remains significant,” Goldman economist Alec Phillips writes in the report, “and our working assumption is a further 5-10 percent by mid-2010.” Moreover, Goldman estimates the tax credit has boosted sales by 200,000 units. Mammoth purchases of mortgage securities by the Federal Reserve appear to have held home mortgage rates about 0.30 percentage point lower than they would have been, Goldman says. NEW YORK AND NEW JERSEY SHARE DUBIOUS TAX DISTINCTION The highest property tax bills in the country are in New York and New Jersey, according to the Tax Foundation’s analysis of data from the U.S. Census Bureau, reports the Wall Street Journal in Realtor magazine. The national median property tax is $1,854. In order, counties with the highest median property tax are: Westchester County, N.Y., $8,404; Hunterdon County, N.J., $8,347; Nassau County, N.Y., $8,306; Bergen County, N.J., $7,997; Rockland County, N.Y., $7,798; Essex County and Somerset County, N.J., tied at $7,676; Morris County, N.J., $7,310; Passaic County, N.J., $7,095; and Union County, N.J., $7,058. CENSUS BUREAU SAYS NEW YORK CITY AND D.C. ARE TOPS IN TRAVEL TIME U.S. Census Bureau date for 2006 through 2008 show that commuters spent 34.5 minutes driving to work in the New York metro area and 33.2 minutes in D.C. The percent of workers who drove alone to work ranged from 50.4 percent in the New York metro area to 87.3 percent in the Jackson, Tenn. and Monroe, Mich., metro areas. Median home values in metro areas went from a low of $68,200 in Odessa, Tex. to $739,700 in San Jose, the only metro area with a value above $700,000. Six other California metro areas had medians in excess of $600,000: Santa Cruz, San Francisco, Salinas, Napa, Santa Barbara and Oxnard. The metro area with the smallest average household size was Ocean City, N.J., at 2.0 people per household. THERE MAY BE FIVE REASONS FOR CAUTIOUS OPTIMISM If you’re curious about them or want to challenge the conclusions, visit the Service You Can Trust Blog. PRICES COULD SLIDE ANOTHER 10%, SAYS FORBES The present high level of unsold housing inventories, the poor state of the labor market and the current wave of foreclosures suggest that home prices may have a further 10 percent to fall (in real terms), according to the publication. BUBBLEMAN SAYS PRICES ARE RISING TOO FAST IN SOME AREAS Robert Shiller, the man who predicted the dot-com bubble, warns that house prices in some areas of the U.S. could be approaching bubble territory, reports Global Edge. DEPENDING ON WHOM YOU ASK, NYC PRICES STILL COULD DIP A number of analysts are predicting a second round to the downturn, with prices likely to fall, according to the Real Deal. Estimates range from a drop of a few percentage points to up to 17 percent. Barry Ritholtz, the New York-based CEO and director of equity research at Fusion IQ, an online quantitative research firm, said that "there's still some downside to prices" in New York. “The good news is the worst of the bloodbath is probably behind us in terms of falling prices," he continued. "The bad news is unemployment continues to tick up and foreclosures continue to ramp up. I do not think New York is at a bottom quite yet." The Real Deal quotes too many other sources to cite here. Where Has All the Logic Gone? Defensive best describes the response of a broker whose listing in the low 70s between Amsterdam and Columbus was criticized here a couple of newsletters ago. The price for this renovated two-bedroom (including the maid’s room) with dining room, stylish kitchen and intolerably strange and awkward flow has remained at $1.395 million since the condo went on the market last November. Yes, that’s almost a year ago. At an open house for another of her listings, the broker asked for an opinion about two-bedroom apartment. “It’s overpriced” “How much?” “Um, by about $200,000.” “Well,” she huffed, “you have to leave room for negotiation.” “How long has it been on the market?” “We’ve had five offers, but no one wanted to wait for the seller to move out,” the broker replied, evading the question. “The last one was at $1.15 million.” “Well, good luck!” Good luck, indeed. Now that the unit is vacant - making it harder to show at its best - she clings to the expectation that it will sell more easily at a good price. It is true that buyers these days expect a bargain and that many tend to bid very low. Perhaps paradoxically, it also is also true that asking prices way beyond true value discourage those who feel ruled out by the limits of their range. Perhaps the most compelling reason for hiring a broker is to expose a property to as many potential purchasers as possible. When, then, is it in the seller’s interest to reduce the number of individuals who will consider even visiting a place because they perceive the property to be beyond their range. What is the harm of setting a price that is realistic and engaging in a hard negotiation? Such a strategy works all the time, while a strategy of what amounts to something close to bait and switch works only some of the time. This concern is a recurring theme here and in the Service You Can Trust blog but one that is worth repeating, no? Meantime, below are recently visited properties that are listed by various brokers, including another overpriced apartment being marketed by the broker in the foregoing true anecdote (sixth bullet): The 70s
Other West Side Neighborhoods
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!
©
2009 Service You Can Trust |
||
|
“Much of the momentum is from people responding to the first-time buyer tax credit, which is freeing many sellers to make a trade and buy another home,” commented NAR Chief Economist Frank Nothaft. Saying that home values could soon turn consistently positive, he declared, “We are not there yet.” Total housing inventory at the end of September fell 7.5 percent, representing a 7.8-month supply at the current sales pace, down from a 9.3-month supply in August. Unsold inventory totals are 15.0 percent below a year ago and the lowest amount in two and a half years. The national median existing-home price for all housing types was $174,900 in September, 8.5 percent lower than one year earlier. Single-family home sales rose 9.4 percent, 7.7 percent more than September 2008. The median price equaled the national figure, and it was 8.1 percent below a year ago. Apartment sales climbed 9.7 percent higher than in September, 9.7 percent more than the prior year. The median was $175,100, off 11.7 percent from September 2008. Unsurprisingly, economists had a 
Home prices in San Francisco and elsewhere have risen by double-digits over four months, the Yale economist says. If viewed on an annualized basis, they look like they are in "bubble territory," Shiller contends. U.S. home prices in August rose for the fourth straight month, by 1.2 percent from July, according the Case-Shiller indices. “The prominent fact that we are seeing with this data is that home prices are just zipping up," he says. "It is entirely possible that even with the bad news we are getting, home prices could start a major increase. . . What happens from here will depend on people's animal spirits and speculative impulses." Even in the Great Depression real home prices were rising with the unemployment rate above 12 percent, the economist relates, adding, “Just because we have high unemployment does not mean the stock market cannot boom and the housing market cannot boom.” 
