Archive for January, 2010

The IRS earlier this month released the new form that eligible homebuyers need to claim the first-time homebuyer credit this tax season and announced processing of those tax returns will begin in mid-February. The IRS also announced new documentation requirements to deter fraud related to the first-time homebuyer credit.

The new form and instructions follow major changes in November to the homebuyer credit by the Worker, Homeownership, and Business Assistance Act of 2009. The new law extended the credit to a broader range of home purchasers and added new documentation requirements to deter fraud and ensure taxpayers properly claim the credit.

With the release of Form 5405, First-Time Homebuyer Credit and Repayment of the Credit, and the related instructions, eligible homebuyers can now start to file their 2009 tax returns. Taxpayers claiming the homebuyer credit must file a paper tax return because of the added documentation requirements.

The IRS expects to start processing 2009 tax returns claiming the homebuyer credit in mid-February after it completes the updating and testing of systems to meet the law’s new requirements. The updates allow the IRS to put in place critical systemic checks to deter fraud related to the homebuyer credit.

Some of these early taxpayers claiming the homebuyer credit may see tax refunds take an additional two to three weeks.

In addition to filling out a Form 5405, all eligible homebuyers must include with their 2009 tax returns one of the following documents in order to receive the credit:

  • A copy of the settlement statement showing all parties’ names and signatures, property address, sales price, and date of purchase. Normally, this is the properly executed Form HUD-1, Settlement Statement.
  • For a newly constructed home where a settlement statement is not available, a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.

In addition, the new law allows a long-time resident of the same main home to claim the homebuyer credit if they purchase a new principal residence. To qualify, eligible taxpayers must show that they lived in their old homes for a five-consecutive-year period during the eight-year period ending on the purchase date of the new home. The IRS has stepped up compliance checks involving the homebuyer credit, and it encouraged homebuyers claiming this part of the credit to avoid refund delays by attaching documentation covering the five-consecutive-year period:

  • Form 1098, Mortgage Interest Statement, or substitute mortgage interest statements,
  • Property tax records or
  • Homeowner’s insurance records.

The IRS also reminded homebuyers that the new documentation requirements mean that taxpayers claiming the credit cannot file electronically and must file paper returns. Taxpayers can still use IRS Free File to prepare their returns, but the returns must be printed out and sent to the IRS, along with all required documentation.

Normally, it takes about four to eight weeks to get a refund claimed on a complete and accurate paper return where all required documents are attached. For those homebuyers filing early, the IRS expects the first refunds based on the homebuyer credit will be issued toward the end of March.

The IRS encourages taxpayers to use direct deposit to speed their refund. In addition, taxpayers can use Where’s My Refund? on IRS.gov to track the status of their refund.

http://www.youtube.com/watch?v=GkzB03uuGlg

More details on claiming the credit can be found in the instructions to Form 5405, as well as on the First-Time Homebuyer Credit page on IRS.gov.

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.

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Jan
21

Brooklyn Market Overview Q4 2009

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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.

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Jan
21

Queens Market Overview Q4 2009

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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.

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Jan
20

The Good Old Days

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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

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Long-term mortgage rates moved down slightly last week as some of the recent optimism regarding the economy waned while industrial output increased a solid 0.6%.  The increase is due to utility output related to the frigid weather gripping much of the nation.  Retail sales dropped by 0.3%. which was quite shy of the 0.5% increase that analysts had forecast.  Fortunately, both the Consumer Price Index’s headline and core numbers increased only a scant 0. l%.
Top Economic Reports 01-18-10
While the market is being reminded that this recovery is at its early stages and is a rather muted recovery the debate over what the Fed will do regarding its purchases of mortgage-backed securities is heating up. Some analysts are predicting n full 1.0% or more increase in rates by March, while others see only about a 0.5% increase in the first half of the year. In any event, rates are very, very likely to increase over the next few months. However, we could see rates slip just a little more next week if economic news continues to point to a slow path for economic recovery.

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.

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Jan
16

Q4 Manhattan Residential Rental Report

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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.

Jan
12

Q4 2009 Manhattan Residential Sales Market Report

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Q4 Market Report Chart and Graph 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:

Corcoran, Brown Harris Stevens and Halstead Property

Categories : Market Reports
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Jan
11

Back On The Market

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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.

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