According to comments this last weekend by Treasury Secretary Timothy Geithner the risk that the economy will slip back into recession is lower now than at any time in the past year. While the probability of a “double-dip recession” may be unlikely, Geithner believes the current recovery is likely to be very uneven. Some evidence of this was certainly present in last week’s ISM Indices. The services index managed to stay above 50, indicating a slight amount of growth in service industries. while the manufacturing index bolted to its highest level since 2004. While the Labor Department employment data did show signs of an improving labor market, other measures released last week were
not as positive. Overall, we are at a point where mortgage rates might slip slightly, but the risk of a quick upward movement continues to grow.
This week has a bit less economic data than last week, but with Retail Sales data due, we could see rates moving upward, especially if sales come in stronger than most analvsts are predicting.
Graph Courtesy from NY Times in an article by Bob Tedeschi January 28, 2010. Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.
Approximately 92,000 co-op and condo sales transactions from more than 6,500 buildings over the last ten years were analyzed. Each of the 53 different market areas have been presented with data tables and charts as well as a summary matrix that compare 2009 to the prior year (2008) and prior decade (2000).
- After setting records in 2008, all three price indicators declined in 2009. This is the first time that any of the three price indicators have posted year-over-year declines since 1996.
- The 2009 median sales price of a Manhattan apartment was $850,000, down 11% from the record set in 2008 at $955,000
- Manhattan housing prices have doubled over the past decade. Price per square foot increased 105.6% to $1,073 from $522 in 2000.
- There were 7,430 sales in 2009, 27.9% fewer than were sold in 2008. However, the release of pent-up demand from the first half of 2009 caused the second half to see a surge in sales activity.
- The annualized pace of sales in the second half of 2009 was 9,400 units, higher than the 9,178 average annual number of sales over the last decade.
- There were 6,851 listings on the market at the end of 2009, 24.6% less than 9,081 listings in 2008, which was the highest level of inventory in the past decade. The 2009 inventory level was in line with the 6,860 average annual inventory level since 2000.
- Over the past decade, the Manhattan condo market has surpassed the co-op market in sales, beginning with a 40% market share and ending with a 54% market share. The gain was primarily due to the addition of new development sales to the housing stock.
The 2000-2009 Manhattan Market Report relaeased today and summarized above was prepared by Miller Samuel for Prudential Douglas Elliman.
After setting records in 2008, all three price indicators declined in 2009. This is the first time that any of the three price indicators have posted year-over-year declines since 1996.
The 2009 median sales price of a Manhattan apartment was $850,000, down 11% from the record set in 2008 at $955,000
.
Manhattan housing prices have doubled over the past decade. Price per square foot
increased 105.6% to $1,073 from $522 in 2000.
There were 7,430 sales in 2009, 27.9% fewer than were sold in 2008. However, the release of pent-up demand from the first half of 2009 caused the second half to see a surge in sales activity.
The annualized pace of sales in the second half of 2009 was 9,400 units, higher than the 9,178 average annual number of sales over the last decade.
There were 6,851 listings on the market at the end of 2009, 24.6% less than 9,081 listings in 2008, which was the highest level of inventory in the past decade. The 2009 inventory level was in line with the 6,860 average annual inventory level since 2000.
Over the past decade, the Manhattan condo market has surpassed the co-op market in sales, beginning with a 40% market share and ending with a 54% market share. The gain was primarily due to the addition of new development sales to the housing stock.
While last week had some economic data released, non-market events seemed to dominate. Fed Chair Bernanke was reconfirmed by the Senate. but with the smallest number of votes in the Fed’s history. This may foreshadow some interesting battles ahead for monetary management in the US in coming months. The Fed also met, leaving interest rates unchanged again. However, its policy announcement confirmed the end dates for a number of market support programs. including a March 31st termination of the Fed’s program of buying mortgage-backed securities. In addition to all this, GDP came in at a brisk 5.7%, Consumer Confidence and Sentiment increased, and existing home sales cratered. Everything seemed to come out in balance, and mortgage rates barely budged.
This week, we may have a bit more focus on economic data with the ISM reports and employment data. With signs pointing toward economic recovery, even a tepid one, a decrease in unemployment and net gain of jobs in January could push mortgage rates upward into next week.
Graph Courtesy from NY Times in an article by Bob Tedeschi January 28, 2010. Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.
Last week saw mortgage rates sliding downward, as a few big concerns began weighing heavily on the market. Economic news continues to highlight a very muted recovery, but fears of a double-dip recession were fanned by events in Washington. While bank-bashing has become a popular pastime, the Obama administration took it one step further with the proposal of a tax structure that would hit all large banks. Regardless of one’s opinion of banks or the tax, it is
very likely that business and consumers will ultimately bear this new tax. To compound the market’s concerns, uncertainty surrounding the reappointment of Fed Chair Bernanke stoked anxiety. A failed confirmation could easily lead to months of political bickering, dragging the search for a successor on for many months.
This week is a huge week for markets. In addition to the political concerns, the Fed meets again with analysts ready to dissect its policy announcement looking for clues of future Fed moves. With GDP data, Consumer Confidence. and slew of housing data on tap. rates could move either way.
Graph Courtesy from NY Times in an article by Bob Tedeschi January 14, 2010. Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.
Today we are released fourth quarter sales for the Brooklyn residential market. Brooklyn Market Overview Q4 2009 reported here and summarized below was prepared by Miller Samuel for Prudential Douglas Elliman.
“Sales activity was elevated as purchasers sought to take advantage of improved affordability brought on by low mortgage rates, the federal tax credit and lower housing prices.”
- There were 2,093 sales in the fourth quarter, 13.4% higher than 1,846 units in the same period last year and 13.3% higher than 1,847 units in the prior quarter.
- As a result of increased sales activity, inventory declined over the same period. There were 5,439 listings available at the end of the fourth quarter, 10% below the 6,042 listings available at the end of the same period a year ago and 2.9% below the 5,600 units available at the end of the prior quarter.
- The median sales price of a Brooklyn property was $447,174 in the fourth quarter, down 8.7%
- from $490,000 in the prior year quarter and down 6.1% from $476,000 in the prior quarter.
- Days on market expanded by a month to 163 days, from 133 days in the same period last year, but was essentially unchanged from 165 days in the prior quarter.
- Listing discount—the percent spread between the list price at the time of contract and the contract price—was 6%, up from 4% in the prior year quarter and up from 5.6% in the prior quarter.
Today we are released fourth quarter sales for the Queens residential market. The Queens Market Overview Q4 2009 reported here and summarized below was prepared by Miller Samuel for Prudential Douglas Elliman.
“The fourth quarter 2009 Queens market experienced a surge in sales activity, with 55.6% more sales than during the same period a year ago. Consumers took advantage of the federal tax credit, low mortgage rates and more affordable prices. As a result of the increase in sales, listing inventory has fallen 10.6% and is at its lowest level in three years.”
- There were 4,260 sales in the fourth quarter, 55.6% more than the 2,737 sales of the prior year quarter and 52.7% more than the 2,789 sales in the prior quarter.
- Listing inventory is at its lowest level in three years. There were 8,778 properties listed for sale at the end of the fourth quarter, 10.6% below the 9,822 units listed for sale in the prior year quarter and 10.4% below the 9,797 units listed in the prior quarter.
- Prices continue to slip. Median sale price was $350,000, 7.9% below the $380,000 median sales price of the prior year quarter and 3.3% below the $362,000 median sales price of the prior quarter.
- The average days on market was 104 days, or two weeks longer than the 90 days on market in the prior year quarter.
- Listing discount, the spread between the last list price and contract price, fell to 6.1% in the fourth quarter, down from 8.7% in the prior year quarter and unchanged from the prior quarter.
The Good Old Days
By ·Someone sent this to us. Can you relate?
1974: KEG
2009: EKG
1974: Acid rock
2009: Acid reflux
1974: Moving to California because it’s cool
2009: Moving to California because it’s warm
1974: Trying to look like Marlon Brando or Liz Taylor
2009: Trying NOT to look like Marlon Brando or Liz Taylor
1974: Seeds and stems
2009: Roughage
1974: Hoping for a BMW
2009: Hoping for a BM
1974: The Grateful Dead
2009: Dr. Kevorkian
1974: Going to a new, hip joint
2009 Receiving a new hip joint
1974: Rolling Stones
2009: Kidney Stones
1974: Being called into the principal’s office
2009: Calling the principal’s office
1974: Screw the system
2009: Upgrade the system
1974: Disco
2009: Costco
1974: Parents begging you to get your hair cut
2009: Children begging you to get their heads shaved
1974: Passing the drivers’ test
2009: Passing the vision test
1974: Whatever
2009: Depends
Graph Courtesy from NY Times in an article by Bob Tedeschi January 14, 2010. Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.
Recently the industry has reported data on fourth quarter rentals for the Manhattan residential market. The Q4 Manhattan Rental Market Overview reported here and summarized below was prepared by Miller Samuel for Prudential Douglas Elliman.
- Average rental price declined 4.3% to $3,789 from $3,958 the same period last year but up 0.8% from $3,759 the prior quarter.
- Rental price per square foot declined 4.6% to $47.02 per square foot from $49.30 per square foot during the same period last year, and down 1.7% from $47.84 per square foot in the prior quarter.
- Median rental price declined 9.4% to $2,900 from $3,200 in the same period last year and down 1.7% from $2,950 in the prior quarter.
- Number of rentals surged 47.5% to 2,456 units from 1,665 units in the prior year quarter.
- Listing inventory fell 21.3% to 5,225 units from 6,640 units in the prior year quarter.
- Days on market were 76 days, down from 97 days this time last year.
- Listing discount was 6.5%, down from 6.9% in the same period last year.
The reports do not account for the incentives (concessions) that tenants are frequently offered in the current market, like months of free rent or waived brokers’ fees. It is worth noting that that if those factors had been taken into consideration, rents could appear considerably lower. Perhaps as high as 10% lower.
Experts remain cautiously optimistic about this year as the unemployment rate, which has a huge impact on the rental market, remains high. ”We are looking for more of the same in the first half of 2010–stable activity and pricing,” Mr. Miller said.
Jonathan Miller’s pod cast discussing the Q4 Manhattan Market Overview can be heard here.
In addition, reporting and analysis of the Q4 Rental Market Survey were consolidated on the Miller Samuel website and shown below.
01/14/2010 PR Newswire Prudential Douglas Elliman 4th Quarter 2009 Manhattan Rental Market Overview
01/14/2010 Earth Times Prudential Douglas Elliman 4th Quarter 2009 Manhattan Rental Market Overview
01/14/2010 Business Week Manhattan Apartment Rents Drop 9.4% as City Job Losses Mount
01/14/2010 Bloomberg.com Manhattan Apartment Rents Drop 9.4% as City Job Losses Mount
01/14/2010 TheStreet.com Prudential Douglas Elliman 4th Quarter 2009 Manhattan Rental Market Overview
01/14/2010 The Real Deal Manhattan rental deals up in 4Q: reports
01/14/2010 Yahoo Finance Prudential Douglas Elliman 4th Quarter 2009 Manhattan Rental Market Overview
01/14/2010 Fox Business Prudential Douglas Elliman 4th Quarter 2009 Manhattan Rental Market Overview
In addition to the Prudential Douglas Elliman report, some of the above articles refer to the Citi Habitats Q4 Market report.
Recently the industry has reported Q4 sales for the Manhattan residential market. The Manhattan Market Overview reported here and summarized below was prepared by Miller Samuel for Prudential Douglas Elliman.
- Q4 continues the surge of activity seen in Q3 with 2473 sales up 10.9% from 2230 last quarter and up 8.4% from 2282 prior year quarter.
- By far, the most activity and shortest Days On Market were seen in the under $1 million category
- Inventroy Down 18.3% from last quarter and down 24.6% from prior year quarter
- Average sales price per square foot up 5.5% over last quarter ($1051/sf) but down 11.2% over the prior year quarter ($1183/sf)
- Median sales price $810 down 4.7% over last quarter and down 10% from $900 in the prior year quarter.
- Days on Market up 28.3% from last year quarter
- Inventory down 24.6% form last year quarter
Reporting and analysis of the Q4Market Survey were consolidated on the Miller Samuel website and shown below.
01/07/2010 -NuWire Investor- Manhattan Property Prices Plummet In Fourth Quarter
01/07/2010 -Before it’s News- Manhattan Residential Market Slowly Clambering Out of Hole
01/07/2010 -Epoch Times- Manhattan Residential Market Slowly Clambering Out of Hole
01/06/2010 -PropertyWire- Reports reveal the devastating effect of the Wall Street decline on apartment prices in Manhattan
01/05/2010 -Earth Times- 4th Quarter 2009 Manhattan Residential Market Report – Prepared by Miller Samuel
01/05/2010 -PR Newswire- 4th Quarter 2009 Manhattan Residential Market Report – Prepared by Miller Samuel
01/05/2010 – Reuters- Plunging home prices pull Manhattan buyers back in
01/05/2010 -ABCNews.com- Manhattan Home Sales Rise in 4Q, but Prices Vary
01/05/2010 -Bloomberg.com- Manhattan Apartment Prices Fall as New York Loses Finance Jobs
01/05/2010 -TheStreet.com- 4th Quarter 2009 Manhattan Residential Market Report – Prepared By Miller Samuel
01/05/2010 -The Real Deal- Manhattan home sales market on the mend, but is a double-dip ahead?
01/05/2010 -Fox Business- 4th Quarter 2009 Manhattan Residential Market Report – Prepared by Miller Samuel
01/05/2010 -Crain’s New York Business- Manhattan residential market ends year on up note 01/05/2010- New York Magazine- Manhattan Real Estate: Sales Recovering and Inventory Shrinking
01/05/2010 –Business Week- Manhattan Apartment Prices Fall as New York Loses Finance Jobs
01/05/2010 -1010Wins.com- Manhattan Home Sales Rise in 4Q, but Prices Vary Website
01/05/2010 -CNNMoney.com- Will bonuses save the day for Manhattan real estate?
01/05/2010 -The New York Times- Manhattan Home Sales Rise in 4Q, but Prices Vary 01/05/2010 -New York Post- Manhattan housing slide slows
01/05/2010 -Air America Beta- Manhattan home sales rise in 4Q, but prices vary
01/05/2010 -Inman News- Manhattan closings up, prices down
01/05/2010 Top News Fall in Prices Recorded by Manhattan Residential Real Estate
01/05/2010 -The Money Times- Manhattan records slide in home prices Website
01/05/2010 -WNYC.com- 2009: A Buyer’s Market For Manhattan Real Estate Website
01/05/2010 -Curbed.com- State o’ the Market Reports: The Manhattan Bleeding Slows!
01/05/2010 -Daily News- Housing on rebound: Manhattan condo, co-op sales climb at end of last year
01/05/2010 -Scottrade- 4th Quarter 2009 Manhattan Residential Market Report – Prepared by Miller Samuel
01/04/2010 -The New York Times Sales Spur Optimism in Manhattan Real Estate
01/04/2010 The Seattle Times Manhattan home sales rise in 4Q, but prices vary
In addition to the Prudential Douglas Elliman report, some of the articles above mention these other 4Q market reports:
Back On The Market
By ·Thanks to the many friends, clients, customers and readers for showing your concern for my apparent absence from posting to the Real Estate Geezer.
As Boomers and DINKs, my wife and I have been fortunate enough to celebrate the holidays this year with my dad 84, my aunt who is 100 and my wife’s mom who is 94 years old.
But some things had changed. In early December 2009 my dad was diagnosed with pancreatic cancer and my aunt, although physically “healthy”, began having more difficulty walking, severe memory problems, and because caring for herself had become impossible she needed around-the-clock assistance.
Becoming a caregiver for our loved ones takes a lot of adjustment. Dealing with their doctors, Medicare, working with the pharmacies and the nurses’ aids is daunting and very time consuming. The emotional strain and the role reversal, if you will, as well as the financial aspects of getting old, made my wife and I look into ourselves, face our mortality and wonder what our lives will be like when we reach their age and have similar medical problems.
All this with the backdrop of the health care reform bill now coursing its way through congress. I must say, from what I understand, the bill does nothing to ease the financial and emotional strain of what millions of Boomers will be facing in the very near future. More on this when I actually get to read what the House/Senate reconciliation committees finally agree on — behind closed doors.
Well I’m back now. Back on the real estate market, so to speak. There is an order to things. My aunt’s nurses and Dad’s chemo therapy are scheduled. I give a wake up call to my father every day, bring him his breakfast, the morning newspaper and arrange his medication. And if he feels good that day perhaps we go for a short walk. I pick up my aunt’s mail give her a hug and hope she remembers who I am that day. Then I head to work.
Things make more sense now. Reading the New York Times blog The New Old Age has been very helpful. I feel less alone now. The support of the neighborhood and city infrastructure can be very reassuring. For example, The Lenox Hill Neighborhood House, only a half block from our apartment and where I was an after-school and day camp member over 50 years ago, was so helpful in assisting my dad and I in getting him Medicare drug coverage. They continue to offer invaluable help with assisted living ideas for my aunt and perhaps the eventual hospice care for both of them. And on good days, when both dad and aunt get out their apartments, they can visit with their friends at the senior center and have some lunch.
We’re lucky to live within four or five blocks of each other. We love our doormen who are an important part of our extended family. They show genuine concern, hold the elevator when dad is walking a bit slow, and even help us get a cab when the wind and snow make it difficult for even the sure footed to get around. They are just really nice! We love New York City because of the convenience, and yes, the small-own feel of the neighborhoods. We’re thankful for Fresh Direct and the convenience of being steps away from almost anything you may ever need or want.
I’ll file this under Boomers and will continue to update this story from time to time. If any of you are having similar experience, or just need some support or someone to speak with, please don’t hesitate to contact me. I’ll be more than happy to help in anyway I can.
Caught in the maze of buying an apartment in New York City? The rules are different in New York City than in other parts of the country! For the inexperienced some of the differences may be perplexing, however, we can guarantee that if you do your homework and keep this guide handy, the process will flow much more smoothly.
New York is a city comprised mainly of cooperative and condominium apartments with a smaller selection of private homes, which we call townhouses or brownstones. Most important is understanding the differences between the types of apartments you will find in Manhattan.
Co-operative Buildings
Cooperatives are not a new concept, although they seem to be a type of ownership that is more common in New York City than elsewhere in the United States. In New York City, approximately 80% of our apartments available for purchase are in cooperative buildings, while 20% are in condominiums. This means two very simple things to potential buyers in New York City:
- There is more inventory to choose from if the buyer includes co-ops into the mix of properties, and
- Prices are, in general, more attractive for cooperatives – simple supply and demand.
Cooperatives are owned by an apartment corporation. Individual tenants do not actually “own” their apartments as they would in the case of “real” property. Owners, (shareholders) of co-op apartments, actually own “shares” in the corporation which entitles them to a long-term “proprietary lease.” The corporation pays the total amount of the building’s mortgage (importantly, a cooperative may have an underlying mortgage on the entire building, whereas a condominium building must be owned outright), real estate taxes, employee salaries, and other expenses for the upkeep of the building. The tenant-owner, in turn, pays a portion of these expenses as determined by the number of shares the tenant owns in the corporation. Share amounts are dictated by apartment size and floor level.
The considerations when buying a cooperative are:
- The Board of Directors has the right to “approve” or “reject” any potential owner. The board, elected by all of the tenant-owners of the co-op, interviews all prospective owners. It has the responsibility of protecting the interests of all tenant-owners by selecting well-qualified candidates.
- The quality of services and the security of the building are kept at high standards.
- Portions of the monthly maintenance are tax deductible. Each building has its own tax structure, but all co-ops offer a tax advantage. Shareholders can deduct their portion of the building’s real estate taxes, as well as their proportionate share of the interest on the building’s mortgage.
- The amount of money that may be financed is determined by each cooperative. Some buildings require substantial down payments. Generally speaking, in Manhattan prospective purchasers should be prepared to “put down” at least 20 to50% of the purchase price (depending on the building) when purchasing a cooperative apartment.
- Subleasing a co-op must be approved by the Board of Directors of the cooperative. Each corporation has its own rules, and they should be examined if a potential owner intends to sublet.
With this in mind, it is important to remember that co-ops are the norm here in Manhattan, not the exception. However, before beginning a search for a cooperative apartment, think about the financing limitations and the application and interview process.
Condominium Buildings
While condominiums are quite common throughout the country, they are a rather new concept for New York City. A condominium apartment in Manhattan is real property. The buyer gets a deed just as if he were buying a house. Since this is real property, there is a separate tax lot for each apartment. Hence, this means the buyer pays his own real estate taxes for the property. An owner will also pay common charges on a monthly basis. Common charges are similar to maintenance in a cooperative. However, they will not include real estate taxes since these are paid separately, nor will they include the building’s mortgage and interest given that a condominium, by law, cannot have an underlying mortgage. Condominiums are attractive for a variety of reasons:
- Financing the purchase of a condominium apartment is governed by the financial markets not a board of directors and thereby much more flexible than in a cooperative. In the past, a buyer could finance up to 90% or more of the purchase price. However, with the current conservative credit practices, you should be prepared to “put down” about 20% or more even for a condo.
- An approval process is usually required, and most condo boards are requiring application packages with financial disclosure. Generally, however, the requirements are not as rigorous as the co-op boards. A board meeting may or may not be required. The length of time for approval varies from building to building, but it is usually not as long as a co-op approval process.
- There is greater flexibility in sub-leasing your apartment. This makes condominiums the better choice for investment property.
- They are the ideal choice for non-U.S. citizens or for those with their assets held outside of the United States given that co-ops are unlikely to approve a buyer whose funds are not in the U.S.
Given that there are fewer condominiums than cooperatives and that they are “easier” to purchase, they are generally more expensive than co-ops. Additionally, monthly combined common charges and real estate taxes in a condo are typically less than a co-op’s monthly maintenance charges, again resulting in higher purchase prices.
Excerpted and modified from Prudential Douglas Elliman.






Assuming that you’ve found the property on which you wish to place an offer you’ll find the steps to purchasing a