Archive for May, 2013

May
24

Muck House Removal at 72nd Street

Posted by: | Comments Comments Off

The MTA has been advising us over the past few months that the 72nd Street muck house removal will be occurring this Spring, commencing in May. This work has commenced and the structure is currently being emptied of all materials and equipment. The breakdown of the structure’s metal enclosure and framework will begin within the next few days. To facilitate the safe removal of the enclosure and to protect passing pedestrians, a sidewalk shed will be installed on or about Monday, May 13th along the east sidewalk of Second Avenue between 72nd Street and 73rd Street.

Please note that the scope and nature of construction activities are subject to change based upon field conditions. All work has been approved by appropriate City agencies where required. The MTA committed to completing this work quickly and safely with the least amount of disruption to neighborhood residents, and they appreciate your continued patience during this construction.

If you have any questions, please contact Lisa Blugh-Willis, Community Liaison for the 72nd Street Station Area, via email at

Lisa.Blugh-Willis@2avesubway.com

or after hours at (212) 792 9716.

Categories : In The Neighborhood, UES
Comments Comments Off

Douglas Elliman released the April 2013 report for Manhattan & Brooklyn Residential Rental Markets.  The April 2013 Elliman Report for the Manhattan & Brooklyn Rental Markets reported here and summarized below was prepared by Miller Samuel for Douglas Elliman.

“Rental prices continued to trend higher, despite rising affordability of home purchases.”

Year to date, Manhattan rents continued to rise at the same brisk pace as last year. The gains in rental prices have been consistent across allManhattan_Brooklyn_Rental_Report apartment sizes compared to a year ago. Landlord concessions were used sparingly and the vacancy rate remained below long-term averages. The continuing strength of the rental market has been somewhat surprising since the Manhattan sales market has also seen rising prices and sales volume. Tight credit conditions and an improving regional economy continue to keep pressure on the demand for rental housing

  • Since the beginning of 2013, rental prices continued to push higher.
  • Median rental price jumped 6.5% to $3,195 from the same period last year, but was unchanged from the prior month.
  • The average year-over-year increase in median rental price has been rising since the beginning of 2013, averaging 5.1% year to date.
  • The vacancy rate was 1.58% in April, exactly the same rate in the same month last year, but below
  • The 1.7% 5-year monthly average.

 

Comments Comments Off

The New York Department of Buildings shares the following tips for recognizing an illegal apartment:

  • Windows – Legal rooms require windows with a minimum size of 12 square feet.  Total window area must be 1/10th of the room size.  For example: a 100 square foot room must have at least 12 square foot (the minimum allowed) of window area.
  • Rent – Rents that are significantly lower than comparable apartments
  • Egress – Tenant should be able to access all available exits either directly from the unit or a public hallway.  To be legal, the apartment must have two means of egress.
  • Utilities – A listing in which utilities are included in the rent may be a way to prevent the disclosure of an illegal apartment.
  • Mail – Tenants should be able to receive mail at the building address and should not be required to obtain a separate P. O. Box.

If you suspect the apartment you are considering may not be legal,  you should request a copy of the certificate of occupancy for the building that shows the apartment is legal.  In addition you can search the Department of Buildings’ Building Information System (BIS) for most recent certificate of occupancy to check the stats of the apartment.

May
20

Popular Kitchen Countertop Materials

Posted by: | Comments Comments Off

When picking kitchen countertops, the choices are many and varied.  Houzz.com offers the following information about some of the more popular materials to help with the decision.

  • Soapstone Resistant to stains, chemicals and bacteria, Soapstone is a durable and natural choice for a kitchen.  At $80 to $100 per square foot installed, it’s pricy, but can be a good investment.
  • Granite A durable natural stone that has unique grain, many colors and customizable finishes, making it very popular right now.  Prices start at $50 per square foot installed, but prices climb quickly when you choose more exotic slabs or have a difficult installation.
  • Copper:  Less common than other natural countertops, it is easy to clean and maintain.  However if you’re a perfectionist, it may not be for you because it reacts to different substances.  If you love the look, be prepared to pay at least $100 per square foot installed.
  • Engineered Quartz:  Perfect for custom homes, it comes in every color under the rainbow.  Engineered from ground quartz, resin and pigments, it creates a tough, nonporous material.  The price is $95 to $105 per square foot installed.
  • Tile:  A durable choice, ceramic or stone tile is a great DIY countertop if you are so inclined.  Maintenance is a bit painstaking with the grout, but a durable, darker grout could ease these issues.  Budget about $30 per square foot installed.
  • Eco-friendly counters:  There are a number of materials that all into this category, with varied price ranges.  Look at salvaged wood, Bio-Glass and bamboo.
  • Zinc:  Fallen out of favor in modern kitchens, this metal has warmth that has made it popular for many years.  The tone darkens with time and zinc has antimicrobial properties.  Figure about $100 per square foot installed.
  • Recycled Paper-Based Counters:   Who would have thought of paper for a kitchen countertop, but it is remarkably durable.  It is blends recycle papers with resins and pigments, and has the look of soapstone for a fraction of the cost (about $40 to $80 per square foot installed)
  • Plastic Laminate:  Probably the most common of all countertops, Laminate countertops have customizable edges and finishes that can work with any design.  It is not the most durable, so if you’re a heavy-duty cook, you might want to choose something else.  Easily the most affordable at $8 to $20 per square foot installed.
  • Recycled Glass and Cement:  These countertops add character to a kitchen.  It is durable and customizable, but rather pricy at $100 to 160 per square foot installed.
  • Marble:  Always a classic look and forever in style, marble offers more variety than most other material.  It’s a softer stone than granite and scratches and stains easily.  Plan on $70 to $100 per square foot installed.
  • Concrete:  You can create many visual textures and colors with pigments, stains and dyes.  Concrete can be worth the cost if you use the right sealer.  Be prepared to shell out $100 to $150 per square foot installed.
  • Stainless Steel:  Professional kitchens use stainless steel because it doesn’t stain, is resistant to heat and easy to clean.  For home use, the fingerprints, scratches and smudges will be very noticeable.  At $80 to $90 per square foot installed, it’s more affordable than most stone countertops.
  • Solid-Surface Countertops:    an engineered product that can mimic the look of stone, wood or plastic, but is more durable and needs less maintenance.  Estimate $50 to $100 per square foot depending on the manufacturer installed.
  • Wood:  There are those who think wood doesn’t belong on the counter.  But the right wood and sealer can make a beautiful warm and long-lasting countertop.  Depending on the type of wood chosen, the price can range from $30 to $85 per square foot for materials, plus installation.

 

Based on post at Houzz.com

Comments Comments Off
May
16

When Foreign Persons Sell

Posted by: | Comments Comments Off

In New York real estate sales there is one sure bet; you will pay taxes.  Whether you are a US tax payer or a foreign investor, the State of New York and the US Government will get their cut.

The question is when will you have to pay up?  The rules are a bit complicated, but one of our favorite legal bloggers, Jerry Feeney explains it like this:

For New York State: people who sell real estate in New York State, whether they are individuals, trusts, estates, or LLCs, must pay the tax at closing on the estimated gain as a condition of the sale, unless they are exempt from payment at closing.  Most transactions are exempt.  However, the exemption is only about the timing of the tax payment, not the obligation to make the payment.   Make no mistake; the seller is accountable to the taxing authority to account for the gains.

If you are a New York State resident, and/or the property being sold was the principal residence of the seller for 2 of the last 5 years, the exemption from paying at closing applies.

For example:  A seller who has owned a condo in New York City that is used as a second home, and is a New Jersey resident must fill out the applicable tax foand remit the tax payment on the estimated gain from the sale or they cannot close.  This is a very good reason to have a good accountant on retainer.

For United States Taxes, people who sell real estate in the United States must also certify at closing if they are exempt from the federal withholding requirement on real estate unless the sales price is $300,000 or less and the property is acquired for a primary residence.  If not, the seller must certify that they are exempt from withholding.  Face it, most New York City real estate is over $300,000.  There are 2 ways the seller could be exempt; if they are U. S. citizens, or resident aliens.  Others are ‘foreign persons’ under the statue and must withhold 10% of the purchase price unless they have obtained a withholding certificate from the IRS approving a smaller withholding.  These certificates can take up to 90 days to obtain, sometimes more, so be sure your attorney starts the process early to ensure a smooth closing.

For Example:  A Canadian citizen who does not have any immigration status in the U.S., and who sells an investment property would be required to have 10% withheld at closing, which must be remitted to the U.S. Treasury.  This seller would then need to file a U.S. Tax return for the year that the property was sold, regardless of whether they have any other U.S. income.

It is vitally important that your team include a qualified attorney and accountant to help you navigate these treacherous and complicated waters.

Based on article by Jerry M. Feeney,  Esq., Residential Real Estate Attorney.

This post is provided as informational proposes only and should not be construed as legal, accounting or tax advice by the RealEstateGeezer. You should seek advice from a qualified professional.

 

May
15

How’s the Market? April 2013

Posted by: | Comments Comments Off

While Quarterly Sales Reports show closed activity for the previous quarter, monthly Contract Signed reports are the ‘crystal ball’ of closed sales to come.  Granted, all contracts signed for any given month may not close in the next month, and some may not close at all but most (over 95%) will become closed sales which will become part of the next Quarterly Sales Report.

In the following charts and graphs you can see how the market stacks up against last month and this month last year.

 

 DOM&SP_April_13

Disc_AP_Apr_13_rev

 

Sales_Region_Apr-13

May
13

East Midtown Rezoning

Posted by: | Comments Comments Off

The East Midtown rezoning proposal was certified by the City Planning Commission on April 22.  It now begins a 7-month Uniform Land Use Review Procedure (ULURP) that begins with review by the local community boards, followed by the Manhattan Borough President, the City Planning Commission and finally the City Council.  Here are some key numbers in this proposal:

  • 70 million – the amount of square feet of office space in East Midtown
  • 14.5 million – the total amount of square feet of new development to result from the East Midtown Rezoning Proposal (broken down below)
  • 10 million – the amount of square feet of existing space to be replaced with new development resulting from the East Midtown Rezoning Proposal
  • 4.5 million – the amount of square feet of additional development resulting from the East Midtown Rezoning Proposal
  • 1.35 million – the amount of unused development rights from Grand Central
  • 250,000 – the number of jobs in East Midtown
  • 40,000 – the minimum square foot site size with 200 feet of wide street frontage to build to the highest FAR within the Grand Central Core
  • 25,000 – the minimum square foot site size with 200 feet of wide street frontage to build using the higher as of right FAR
  • $250 – per square foot cost of the District Improvement Bonus (DIB )for additional floor area above base
  • 80 – the percentage of office stock in East Midtown over 50 years old
  • 73 – the average age of office buildings in East Midtown
  • 67 –the number of New York City Landmark-eligible and/or State/National Register-eligible historic resources identified in East Midtown and surrounding study area.
  • 65 – the number of office buildings that are overbuilt by current zoning standards
  • 20 – the proposed extended width in feet of sidewalks along Madison and Lexington Avenues to improve pedestrian network challenges
  • 20 – the number of potential development sites in East Midtown
  • 19 – the number of projected development sites in East Midtown
  • 15 – the minimum percentage by which buildings utilizing DIB must outperform the current NYC Energy Conservation Code
  • 14 – the number of Fortune 500 companies in East Midtown
  • 13 – the existing width in feet of sidewalks along Madison and Lexington Avenues
  • 5 – the approximate percentage of total office space built in East Midtown over the last 20 years
  • 2 – the number of new office buildings constructed in East Midtown in the last decade
  • 07/01/17 – the earliest date that building permits for Qualifying Sites can be issued

The East Midtown rezoning extending from 39th Street to 57th, from Second Ave and Third Ave to almost Fifth Ave borders our neighborhoods on the Upper East Side.

 

From REBNY Research Newsletter.

May
12

In the News May 12, 2013

Posted by: | Comments Comments Off

5/7/13  Fannie, Freddie will only purchase ‘qualified mortgages’ starting next year:  Starting next January, Fannie Mae and Freddie Mac’s federal regulator will no longer allow them to purchase interest-only loans, loans with 40-year terms, or those with points and fees exceeding thresholds for “qualified mortgages” established by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Adoption of the new limitations on Jan. 10, 2014 “is in keeping with (the Federal Housing Finance Agency’s) goal of gradually contracting (Fannie and Freddie’s) market footprint and protecting borrowers and taxpayers,” FHFA said. SourceFHFA

5/8/13:  Hundreds Pack Upper East Side Church to Protest Marine Transfer Station:  Hundreds of residents blasted the planned East 91st Marine Transfer Station Tuesday, saying the project would leave poor and elderly residents vulnerable to high levels of pollution and vermin.  See full article at DNAInfo.com

 

Last week, the City Council of New York approved the Cornell University Applied Sciences and Engineering campus plan for Roosevelt Island.  According to Council Member Jessica Lappin, the approval came after a number of concessions from both the Bloomberg Administration and Cornell University for the two million square foot Technology campus .

The city committed to contribute funding to the one year summer ferry service pilot program; and the university agrees to use barging to limit the number of construction vehicles on the island and to adopt PS/IS 217, the local school on Roosevelt Island.  The university pledged to provide teacher training and support, after school programming, tech events, career day options and hardware and software programming development.

The facilities will be constructed over a 30 year period, and when completed, will accommodate 2500 students and 280 faculty members. With laboratories, teaching and resource space, student housing, incubators and accelerators, research and development space and a conference center, the facilities will be built on the former Goldwater hospital site.  Cornell and Tecnion signed a 99 year lease agreement and agreed to open an off-site location before construction begins.

 

Based on GlobeSt.com article.

Categories : In The Neighborhood, UES
Comments Comments Off
May
07

Bigger Loans = More Hoops to Jump Through

Posted by: | Comments Comments Off

Jumbo loans, for most lending institutions, are defined as mortgages over $625,500, and they come in three sizes: small, medium and large. Face it if you’re buying in New York City and need a mortgage, you’ll likely be seeking one of these jumbo loans.

While several banks offer these Jumbo Loans, the may have different requirements.  For Example

  • EverBank offers a Jumbo Loan up to $1.5M and requires a 20% down payment, and 12 months of cash reserves; a loan from 1.5M to 2.5M requires a 30% down payment and 18 months cash reserves; and over $2.5M requires $35% down and 2 years of cash reserves.
  • Bank of America offers a jumbo loan up to $1M with a 20% down payment; a $2.5M to $5M loan with 30% down; and $5M+ loans require a 35% down payment.
  • Wells Fargo Home Mortgage has several tiers starting at $417,000 to $2M with 20% down payment and 12 months cash reserves.  After that, for every $1M above the $2M requires an extra 5% down and additional cash reserves.

While most lenders build in some flexibility to their loan programs, expect to see credit score requirements of 720 and above and debt-to-income ratios of 40% to 43%.  You might be able to get more favorable terms if you have a strong financial profile.

Some other things to think about:

  • Relationship:  The first place to look is the lender where you do the majority of your business.  If you have a strong relationship with your lender already, they may be more likely to relax their requirements.
  • Identify liquid assets:  Some lenders will accept assets such as stocks that can be liquidated easily if the borrower does not have sufficient cash reserves to meet the tier requirements.
  • Shop sooner rather than later:  The new Consumer Financial Protection Bureau rules go into effect in early 2014.  These protections will tighten standards for verification of borrower income or assets and make interest-only loans difficult or impossible for many borrowers to obtain.

Based on Wall Street Journal article by Anya Martin

May
06

Emotional Pitfalls to avoid when Selling

Posted by: | Comments Comments Off

It’s easy to become attached to your apartment.  You live there, it gives you shelter, you made memories there, it’s your home.  When it comes to selling, the stakes are too high and the emotional attachment must be broken. If you allow yourself to make decisions based on your attachment you may fall into these pitfalls:

  • Price reduction indecision.  If your apartment was priced based on your sentimental attachment to the property it could be priced too high.  When your broker recommends a price reduction, it is generally because the apartment is not getting enough traffic, or the right kind.  Delaying a decision about a reduction results in more days on the market, and often desperation as the number of days climbs to a level that is inconsistent with the comparable sales within the neighborhood and price range.  A reduction in price widens the pool of available buyers, and is not a decision to be taken lightly.  The best way to combat the indecision is to have a plan in place before the need arises.  Your broker will be able to guide you and provide you with information before the time comes.  He or she would not recommend a price reduction if they didn’t think it was warranted, and in your best interest.
  • Excessive attachment.  The buyers won’t figure into their price the fact that your baby grew up in that apartment or that it was your Grandma’s apartment way back when.  They are looking at plaster and floors, kitchens and baths.  While the stories may be compelling buyers will not pay extra for your memories.  Your decision to sell must be faced in a business-like manner.  If you are excessively attached to your home, you might be inclined to overprice it, disregard your broker’s staging advice; be irrational about negotiations about price or repairs; or fail to respond to market feedback.
  • Ignoring your target market needs.  Your broker will be able to help you with this part.  If your target market is pied-a-terre or young professionals because of size or location, make sure that audience is captured by integrating these points in your marketing; i.e. proximity to subway and other mass-transit, great neighborhood amenities, and built in storage.
  • Celebrating too soon.  It’s tempting to look at national market data and conclude that over asking price offers or multiple offers are the norm.  But it’s not sold until the deal actually closes.  Sellers who ‘celebrate too soon’ run the risk of losing out on a deal because they might fail to stage the apartment properly or fail to do the tasks recommended by their broker to ready the apartment for showings; overprice the apartment; not keep up the appearance of the apartment for showings; or spend the proceeds of their sale before the buyer’s financing and inspections are pending and before the deal closes.  Sometimes deals fall apart.  You need to work with your broker and follow their lead when it comes to the progress of the sale.
  • Price confusion.  Fair market value is defined as what someone is willing to pay for a given item at a given time.  A good way judge is to review comparable sales with your broker to determine a fair market price.  Set the listing price after you’ve been presented with the evidence.    Do not make the listing price decision based on what you think you need to ‘get out’ of the apartment or based on what is next in your life.  Pricing decisions are best made with the cold eye of a business person making a deal.

Inspired by Trulia article by Tara-Nicholle Nelson

Comments Comments Off
May
03

Mortgage Update May 2013

Posted by: | Comments Comments Off

Mortgage_Chart_05-09-13

 

Unemployment Rate Falls

During a week packed full of major economic news, the big market mover was Friday’s stronger than expected Employment report, and mortgage rates ended the week higher. This week’s Fed and ECB meeting announcements produced some volatility but had little net impact.

Following a dismal March Employment report and weaker than expected first quarter GDP data, investors were concerned about another spring slowdown for the US economy. The April Employment report helped alleviate those fears, however. Against a consensus forecast of 155K, the economy added 165K jobs in April. The bigger news was that the figures for February and March were revised higher by 114K. With the revisions, the economy added an average of more than 200K jobs per month during the first quarter. The Unemployment Rate unexpectedly declined from 7.6% to 7.5%, the lowest level since December 2008. Without a doubt, the data was significantly stronger than expected, which is good news for the economy. But for mortgage rates, it was bad news for a couple of reasons. It increases future inflation expectations and it moves the Unemployment Rate closer to the 6.5% target which may cause the Fed to scale back its bond purchase program.

The Fed concluded its highly anticipated meeting on Wednesday. Prior to the release of its statement, investors, expecting to see clearer signs of support for an increase in the magnitude or the duration of the bond buying program, pushed up the price of Treasuries and mortgage-backed securities (MBS). The Fed statement was little changed from the last statement, however, causing MBS prices to lose their earlier gains. The Fed will continue asset purchases until the labor market improves “substantially”. The primary change to the statement was the addition of the language that the Fed is “prepared to increase or reduce” the pace of its asset purchases based on changes in its outlook for the labor market and inflation.chart 050313

Also Notable:

  • Pending Home Sales increased to the highest level since April 2010
  • Weekly Jobless Claims fell to the lowest level since January 2008
  • As expected, the European Central Bank (ECB) cut rates by 25 basis points
  • Eurozone unemployment rose to a record high of 12.1%

 

Graph courtesy New York Times article and newsletter by Fred Ashe from Citi Financial Group.

Comments Comments Off

The real estate mantra used to be location, location, location, but according to NAR and APTA, the new mantra is “location, location, location near public transportation.” 

During the housing slump, properties in neighborhoods with accesses to public transit performed much better than properties in other communities, according to a study by the Center for Neighborhood technology “The New Real Estate Mantra:  Location Near Public Transportation”.     Transportation plays an important role in real estate and housing decisions, and the data suggests that residential real estate near public transit will remain attractive for buyers going forward.

 According to the study commissioned by the National Association of Realtors and the American Public Transportation Association, property values in areas with access to transit including commuter rail, heavy rail, light rail, bus rapid transit and ferry service performed 42% better than homes further from public transit in the same regions from 2006 to 2011.  The findings “support investment in transit and encourage development in location efficient areas, benefiting individual property owners and support a more resilient tax base”.   The study shows that “consumers are choosing neighborhoods with high-frequency public transpiration because it provides access to up to 5 times as many jobs per square mile as compared to other areas in a given region, as well as lower transportation costs, walkable areas and robust transportation choices, “ according to APTA President and CEO Michael Melaniphy.

The Census Bureau reports that 23% of workers with 60 minutes or more commute time use public transit compared of 5.3% of all workers.   About 10.8 million Americans have commutes of more than 60 minutes and more than half a million full time workers have commutes of 90 minutes or more. 

 

Based on articles by Inman News and the National Association of Realtors

May
02

Second Avenue Subway News

Posted by: | Comments Comments Off

On Friday, March 15, 2013, MTA Capital Construction (MTACC) hosted its tenth Second Avenue Subway (SAS) Construction Advisory Committee (CAC) meeting at Marymount Manhattan College. The CAC meetings are an integral part of MTACC’s continuing effort to keep the community informed about construction activity in the neighborhood.

CAC meetings bring MTACC, SAS construction managers and contractors, and representatives of the community together to discuss and work on construction issues. These are working meetings for building representatives, including condo and co-op board members and building managers, those who live in buildings not represented by boards, business owners, and community board and association representatives.  SAS quarterly public workshops are open to the public.

The following is a summary of the March 15th meeting:

  • The last Public Workshop was held on January 30th2013.  The workshop report will be distributed soon.
  • Sidewalk improvements were made on Second Avenue at 69th Street.  Pedestrian crosswalks throughout the work area were also restriped.
  • All drill and blast excavation for the 72nd Street Station Area was completed as of February 28th 2013.
  • Concrete operations will continue until approximately October 2013.  During peak periods, expected to occur from May 2013 – August 2013, there will be a higher frequency of concrete truck activity. This is needed to execute the high volume pours needed to form the cavern arch lining.
  • With blasting ended at the Ancillaries and Entrance 3, these areas will now function as additional access points for cavern operations.  Muck bins that were used to remove excavated material have been eliminated from the sites; however, cranes will remain to allow for the erection of ancillary and entrance structures.
  • Work to disassemble the 72nd Street Muck House will begin in May 2013. Once complete, crews will begin relocating utilities across the 72nd Street shaft. Utility relocation for 1322 Second Avenue is also expected to commence in preparation for Entrance 1 construction.
  • Additional design review has led to a redesign of Entrance 1. The new entrance will be discussed further at a follow-up CAC meeting on April 8th. The latest proposal was presented at the Community Board 8 SAS Taskforce meeting on February 28, 2013. Additional public/community meeting(s) will be scheduled by Community Board 8 to discuss Department of Transportation plans for a proposed bike lane along Second Avenue at the completion of Second Avenue Subway project. Community members are encouraged to check the Community Board’s website for updates and schedules of these Community Board-lead meetings.
  • Please note that the PowerPoint presentation shown at this meeting is available on the MTA.info website: http://www.mta.info/capconstr/sas/documents.html
  •  The next CAC meeting will be held in June 2013.  SAS community liaisons will continue to meet with smaller groups as requested to discuss specific elements of construction progress.

Comments Comments Off

Last winter lawmakers in Albany enacted an extension to the 17.5% tax abatement through June 30, 2015, but they placed a restriction that excludes pied-a-terres.  Since all homes owned by LLCs and Trusts are considered pied-a-terres, they are excluded from receiving the abatement, according to the city’s Department of Finance.  According to spokesman Owen Stone, “We have not changed our interpretation of the law – the law has changed.  Under the previous law there was no restriction, and LLCs and Trusts could qualify, under the new law, they do not.”

This new law could affect approximately 7,700 homeowners who are concerned with their privacy and the convenience of owning property in a trust.  Some experts are saying the new law is penalizing people who want this privacy or convenience, even as the breaks are seen as essential to the market’s growth.

Even the most strict co-op boards who did not allow pied-a-terres have allowed them in recent years for trusts and LLCs, as long as only the trust holder lives there.

Based on article at The Real Deal

Comments Comments Off