Gea's Blog

New York City Real Estate Marke Holding Steady?

2008-06-05T12:16:23Z

While many predicted the first quarter of 2008 would finally show the New York City real estate market's connection to the ailing national market, the city's real estate actually dramatically increased in value during that time. Manhattan led the way for the rest of New York City, which increased its value by an estimated 28%.

The luxury market played a large role in increasing the value of the real estate market as a whole, with a number of different high-end condos coming onto the market during that time. The sales from those apartments have continued to aide the market, even as the national business media focuses on the ailing national economy.

The lesson from the first quarter of the year is an important one: Events not connected to the business cycle – in this case, a number of luxury condominiums coming onto the market when worries about a recession began to amount – such events can prop up markets during pivotal moments, leading to a disproportionate impact on the market as a whole.

It is possible that similarly unexpected positive news could aide the market in the second quarter. The month of April, at least, showed some some signs of healthy activity. The number of sales of existing single family homes increased to 5,838 from 5,035 in March. That accounts for a month-to-month an increase of roughly 14%.

While such upticks are generally expected for this time of year – spring tends to be one of the real estate market's most strongest seasons – the size of the increase is unexpected. It is particularly important because sales volume has been an area of concern since the first quarter numbers showed a decline in year-over-year sales volume of 22%.

The rest of New York state also faired relatively well: Two-thirds of the state's counties reported increases in sales volume during the past month.

Nationally, mortgage rates are once again beginning to near forty year lows in the wake of the fed's recent aggressive rate cuts.

While there is still ample concern over the future of the national market, it is doubtful that the New York apartment market – insulated by its coops from the direct impact of the subprime crisis – will share the fate that markets like Cincinnati, Cleveland and other Midwestern cities.

A recent survey has put the average length of owning home at seven years. Despite the current troubles in the market, it is almost certain that significant growth will be achieved over that time frame.

Battles Loom Over Rent-Controlled NYC Apartments

2008-05-09T18:34:08Z

With the sale last year of a large number of the city's public housing units, the battle over New York City's subsidized housing was brought into stark relief.

Indeed, last year's sale of the Manhattan apartment complexes was not only the largest sale of city land ever, it was part of a larger trend. Over the past several Republican administrations in City Hall, and even before that, the city has been steadily reducing their responsibilities in the public housing sector.

The problem has become especially acute as housing prices began to soar in the latest housing boom. Property values became so high that the city felt more and more pressure from landlords to raise the ceilings on monthly rentals in rent-controlled apartments.

Now however, as the economy is beginning to tank, a whole world of hurt is starting to come down on the pocketbooks of those living in rent controlled apartments.

As if that weren't enough, oil prices are going to be killing residents and landlords of NYC apartments this years.

So, while rents haven't decreased by all that much, the cost of owning and operating a New York City apartment building has.

In fact, the increased pressure on both sides of the subsidized NYC apartment battle could end up being the first instance of a return to stagflation leading to a major political fight in the coming years. As both the demand for public housing and the cost of supplying it increases, something will have to give way in the current set of political battles over public housing policy.

If recent history is any indication, the city will end up moving further in the direction of pushing its poor and middle class families further and further to the borders of the city.

It would take an administration in city hall that is considerably to the left of the past several mayoralties to reverse this trend in the make up of NYC apartments.

In the current political climate, this looks unlikely. However, if the NYC economy continues to do well in comparison to the rest of the country's, then there the funds will be available to the city in order to increase subsidies to both tenants and landlords.

That is to say, the city could, in effect, offset both the rising fuel prices and the upward pressure on rental rates. The question, however, is whether or not the political will is going to be there come decision time.

And that, unlike most variables in the housing market, will be up to the voters.

Construction Levels Help Manhattan Rental Rates

2008-04-14T12:00:54Z

In many ways, 2007 was the culmination of one of the most important periods in the history of New York City real estate. Over the past decade, Manhattan apartments have more than tripled in value. While the rest of the country began to buckle under the pressures of the subprime crisis, the momentum from such a breakneck pace of growth kept the New York City market going strong throughout 2007. Nationally, it was the worst year for housing since the Great Depression; for New York apartments, it was just another solid year of growth.

It was more than just momentum, however, that helped make 2007 a strong year for NYC apartments. At least in terms of Manhattan, there is a long-term, fundamental transformation of the market taking place. Demand started this transformation, as more and more people – especially professionals – wanted to move onto the island. Supply is finally catching up, however. Recent construction has been heavily tilted in favor of the high end markets, both in terms of the upper reaches of the middle class and the pure luxury market.

It's a general rule in real estate that speaks to a basic faith in the responsiveness of markets: The nature of recently completed buildings says a lot about where a market is headed.

For most markets, recent construction is varied enough that it is tough to find any discernible trends just by looking at the new buildings that have started to go to market. In Manhattan, however, the nature of recent buildings speaks volumes about the one and only direction the market is heading in: upscale.

Recently constructed buildings with a doorman, for instance, are 34% more expensive than older buildings with doormen. This reflects much more than the desire for the most modern of accoutrements. Rather, it says that New York real estate is shifting at, historically speaking, a rapid pace towards a market that caters almost exclusively to professionals, the upwardly mobile and others with relatively high salaries.

Furthermore, the average rent in Manhattan south of 96th Street grew to an astounding $3,310 over the course of 2007.

The nature of the recent construction combines with political developments in relation to public housing that further shifts Manhattan towards a nearly irrevocable movement away from the socioeconomically diverse past of the island.

It is good news that supply is responding to demand in a big way on the island of Manhattan. What is troubling, however, is that rents have gotten so high that the most famous of American islands may begin to look fundamentally different in the coming years.

Renting and Buying a Home in Denver

2008-03-25T19:34:22Z

Denver has steadily been growing for many years now. Near the heart of some of the best skiing in the world, and the capital city of Colorado, Denver seems to steadily be becoming a more exciting city with each passing day. This constant improvement in the area’s culture and economic infrastructure has pushed the cost of living about ten percent higher than the national average. Fortunately for those looking to relocate there, most of that cost does not stem from high property values. The average price for a home last year was $260,000. This makes it a considerably more expensive city to buy in than most other cities in the rocky mountains, but still much cheaper than most major US cities.

Likewise, the median rental price was $704. So, Denver is not a cheap city to live in, but it might feel that way for someone moving from Boston, New York or other pricey cities. The average income is also just a bit more than ten percent above the national average. The unemployment rate is about one percent above the national average.

There are a number of ways to find a Denver apartment or house to buy or rent here. Newspaper listings, while constantly shrinking due to the growth in online listings, are still popular here, even though they can’t be efficiently searched. There are several online real estate companies that offer more complete services and extensive listings. All of them allow users to search listings by size and price, but few offer more possibilities than that.

There is one website, though, that has an extremely in-depth set of search options, for both renting and buying. City Cribs – allows its users to search for a home by the details of the house that are important to them. If a potential buyer, for instance, is looking for a place with a balcony, they can search just among the homes in the area that have one. Or, if they are only interested in, say, a five-bedroom furnished apartment with laundry and parking, where landloards allow pets and there are no realtor fees, they can search for that, too. Even the results can be sorted and listed in six different ways.

Online Scammers Take Advantage of Desperate Renters

2008-03-18T11:04:39Z

Money and need do funny things to the human mind. What is far too good to be true from an objective perspective can start looking pretty darn realistic after you've spent months awkwardly crashing on friends' couches while you look for a place to live. There were pioneers who traveled west and struck gold during the California gold rush faster than some people can get an apartment in this city.

And even in this new buyer's market, quality NYC apartments can be about as rare and valuable as gold. Just like gold, there's a whole lot of fake – fool's – versions out there.

Enter the online scammers, who take advantage of the gullible. Recently, on Craigslist, there have been frequent posts in the NY apartments section that sound a little too good to be true. Usually there is some plausible scenario that explains why the rent is so cheap... someone just got a job and has to move with less than a week's notice, or something like that. Of course, since time's an issue, they just ask that you mail them a security deposit, and you'll get a package with the apartment keys with your name on it in just a few days.

The keys never come in the mail.

Of course, online fraud like this exists everywhere, but cons like to target Craigslist, which is used disproportionately by those prone to procrastination. Those that have to find NY apartment in the very near future are like the thirsty in the desert, who willfully think mirage is really an oasis.

The scammers are just using a more modern version of fool's gold... Instead of California, it's Craigslist, and instead of gold itself they are using the modern day equivalent: quality, cheap NY apartments.

And just like back in the day, when the typical pioneer or gold-searcher wouldn't trade his savings for some gold that a random stranger insures is legit, most people today have the basic common sense not to send money to someone they've never met for an apartment that sounds like an incredible deal.

Indeed, many people would argue that if you trusted some random person on Craigslist with your money, you probably deserved to lose every last cent.

Regardless of that, though, these scams have always been based on someone's ability to fool themselves, not on one person's ability to fool another. That's why they don't call it “mildly imprudent gold,” but “fool's gold.” Because it takes a true fool to pay good money for it. Nine times out of ten, that person is a fool because money, needs or wants drive them into a foolish state.

In this case, months spent searching for NY apartments is, apparently, enough to frustrate some people into fooldom.

A Tale of Two Cities

2008-03-11T10:16:01Z

In New York City, the condominium has been the symbol and substance of the last real estate building boom. As rents and property values soared, the city walked away from its traditional reliance on housing co-ops and into a brave new world of condo building. Though 85% of all NYC apartments for sale are still co-ops, the condo market is the newer of the two. As new buildings full of hundreds of brand new apartments go on the market, vacancy rates rise and fall depending on the success of those new buildings.

As the market has slowly but steadily shifted towards a buyer's market again, new worries about the health of the condo market have begun to surface. Owners of many new condo buildings are starting to feel the market pressure come down on them, and are being forced to lower prices in the wake of tougher loan standards and a weakening economy.

What is perhaps most striking about the whole trend is the divide between Manhattan and the rest of the city. Apartments on the island have always done better than other NY apartments, but the divide between Manhattan and the rest of the market has more been a question of degree than of fundamentals.

However, the new condo market might be changing that, at least somewhat. While much of the new construction in Manhattan has been for new luxury condominiums, new buildings in most of the rest of the city have been designed for regular income brackets.

So, it seems to be a tale of two cities: The condo market in Manhattan has been strongly supported by the the luxury market, which is less effected by the ups and downs of the business cycle. So, prices have stayed close to level as of late. The condo market in the rest of the city, however, is starting to become a place where buyers can find better and better deals, as relatively large amounts of new supply is not being greeted with the level of demand that the builders anticipated several years ago when they began construction.

So, the two-tiered nature of the New York City apartment market has been growing more distinct. This may be a good thing for the city's real estate market, which seems to be acting as a market should act, with relatively smooth adjustments in price levels in the wake of changes in supply and demand. It is, however, certainly a bad thing for the city as a whole, which will see an uptick in the already stark income divide between sections of the city. Such divides are, in the long run, always a bad thing for a city's culture and people. In fact, it's the exact same type of division Dicken's had in mind when he came up with his famous title, a book about what was threatening his beloved home city.

New York City Rents Flat in February

2008-03-05T13:02:42Z

Usually, the beginning of the year sees an uptick in rental rates. There are various boring economic reasons for this seasonal cycle that are really just too dry to get into. Suffice to say, it has nothing to do with landlords falling out of their holiday cheer after a month of saying in December "OK guys, you know what, lower rent for everyone, and eggnog drinks on me!" That never happens. Landlords don't do that.

The point is, though, that that didn't happen this year. January rolled around, and average rental rates continued to fall, as the financial markets began laying people off (happy new year!) and the national market continued to plummet.

So, average rental rates for New York apartments in the month of February were on a lot of economists' minds recently.

Thus, it comes as good news to the economy that rents were flat in February - or, at least, that type of "good" news that's good just cause you've gotten so used to bad news that just OK news feels like a heavenly choir in your head.

While the city could certainly use a good amount of low rent housing, the lower rental rates are not a good sign for the economy as a whole.

Basically, the normal cyclical momentum that pushes rents higher this time of year was just enough to arrest the decline in property values.

Interestingly, rents for apartments in buildings without doorman increased slightly, while rents in buildings with doorman decreased. This, perhaps, suggests that larger, more professionally run NYC apartments have been adjusting their rents to the new market environment with more dexterity than smaller landlords. Many of the latter may still be clinging to the past, when New York apartments virtually rented themselves in the most seller's market in the country.

Another important factor in that dichotomy: The recent spate of condo building in the financial district has left a minor surplus in the number of high-end, high rent condos. Over the past two months, most owners of those buildings have lowered rents in order to fill their larger-than-normal number of vacancies.

Rental rates for New York apartments fell in a number of neighborhoods. Harlem and Murray Hill saw some of the largest decreases. SoHo and Battery Park City were not far behind. Rents in Chelsea and Midtown West fell slightly.

The Upper West Side and Upper East Side, meanwhile, saw decent increases in average rents. The Lower East Side also saw a small increase in prices.

Environment for First-Time Buyers Improves

2008-02-28T09:22:04Z

In the real estate market of 2007 and prior – doesn't it all seem so long ago? – first-time buyers were at a distinct disadvantage. The market was something close to rabidly competitive among buyers, and if you didn't have all of your ducks in a row, you'd lose out to the guy who saw the apartment five minutes before you. In fact, there was a chance that the guy that saw the apartment ten minutes after you had a suitcase full of unmarked bills and was just waiting to throw down.

OK, so the last part of that paragraph might have been hyperbole. But the point remains: It was tough to buy your first home. It's quite the process to begin with, but to have to compete with a seemingly endless set of other buyers made it feel next to impossible at times.

These days, however, the market for NYC apartments has become something akin to Goldilocks' porridge for first time buyers. It's not too hot, not too cold. Home values have stayed relatively steady over the past several months. Demand has dropped off just enough that first time buyers can spend a little more time getting to know the process, but not so much that buying is no longer a solid investment in many cases.

First-time buyers, of course, face other hurdles than just getting to know the process. They lack a track record with home loans, so, all things being equal, banks will consider them riskier investments than most potential buyers.

That part, at least, hasn't gotten any better recently. While mortgage rates remain quite low, the credit crunch and the press coverage of the subprime crisis has led most residential real estate lenders to tighten their lending standards, according to a recent report by the Federal Reserve.

Another thing that has helped first-time buyers recently: As the market has shifted away from being a seller's market, those with homes already that have to sell them first are at more of a disadvantage then they were when homes were selling like hotcakes. This has left first-time buyers who have been approved for a loan at a distinct advantage in the eyes of many sellers.

All in all, as the hyper-hot New York apartment market cools, first-time buyers are more likely to find the home-buying process an agreeable process that lacks many of the eccentric challenges that the city's real estate market was home to.

Second Half of 2008 May Present a Gloomy Market

2008-02-26T09:12:59Z

Analysts are growing concerned over the potential of a significant deteriation of the New York City real estate market in the second half of 2008.

So far, the city's market has been far and away the most successful at avoiding the damage that the national real estate climate has done to most other markets. Signs of the New York apartment market's mortality, however, began to appear at the end of 2007.

Even so, most of the drawback in demand has effected negotiation times and other aspects of the selling process more than it has actual prices.

Ironically, this could actually feed into the problem. Some sellers in the NYC apartments market have started to look at the almost-invulnerability of the market and drawn conclusions steeped in economic hubris. Some analysts have noticed this and have grown particularly worried that, while demand softens in the middle of the year, the supply side will be unwilling to lower prices appropriately.

It is doubtful this will be a particularly big factor in the slowdown of the market, but it certainly won't help.

To be sure, a downturn has grown in probability in the past several months. For example, one analyst, quote by Reuters, said that the market is "definitely going to see weakness."

Average prices in the NYC apartment market have seen substantial increases recently, due in large part to the introduction of several major luxury condominium buildings to the market.

Thus, the numbers from last quarter largely soothed any potential bearish attitude in the market. The market knew full well that it was largely being held up by the luxury market. Nonetheless, the psychological impact of new numbers being released that showed starkly reduced growth in value was avoided.

That being said, the median price still increased a solid 6.2% last quarter. (Median values are not much effected by the introduction to the market of super-valuable luxury condos.) So, it is unlikely that the market will see drastic reductions in prices by any means.

What all of this means for the market in the second half of the year is difficult to say. It should be clear by that point if the economy has entered a full-blown recession or not. While it's hard to pierce the protective veneer of the NYC real estate market with national numbers, the word "recession" always strongly weighs on everyone's minds.

If the national news is bad enough, the New York apartment market could start to see a declining overall value by the start of the second half of the year.

Of Love and New York City Real Estate

2008-02-17T17:51:04Z

Homes define New York City. More than any of the cultural attractions the city is known for, the one feature of the city that sticks out in most people's minds when they visit the city for the first time is the endless – as far as the eye can see – ocean of buildings. The vast majority of these are residential, and there is the fundamental New York City in a nutshell: Gone are the suburbs, gone the typical city's dance of urban and suburban; gone the grassy fields at the edge of town... In New York, all is city, and thus all is mankind's culture.

This overwhelming sense of a culture permeating all the physical space of one's existence shines in much of the world's memory. Some are disturbed by it, but many are enthralled. Indeed, much of the city's population first came to the city and saw the city's lights and bars, nightlife and endless ocean of buildings for the first time with a certain powerful sense of awe.

There is a downside, though, to so much of the world recollecting New York City with starry-eyed thoughts: the worlds a big place, and though you wouldn't know it by looking out at those New York apartments, that ocean of buildings does end, and it just can't fit the whole world.

And this is the modern world, so the laws of supply and demand waxes powerful just about everywhere, especially in NYC, the seat of American Capitalism. So, homes here are more expensive than just about any place in the world.

So expensive here, in fact, that real estate concerns sometimes parry in people's minds even with the holy grail of all human existence, love. Stories abound in real estate offices here of couples that either did or didn't get married at a certain time because of concerns over NYC apartments.

For every example of the couple that had known each other for a few weeks before deciding to snatch up a great condo, there are stories of those loving partners who simply loved their home neighborhoods more. When it came time to move in, they just couldn't settle on a place. So, their relationship drifted for a while, and relationships that drift are relationships that might die: And so the prime part of human supply and demand – the need for shelter, or – the real estate market, runs up from the most mundane, practical part of life to bid challenge in mankind's mind with the loftiest emotion of all.

But then again, great New York apartments are quite hard to come by. Almost as hard as great lovers. So, here in a city where man has covered the vast majority of nature with tar, concrete and buildings, real estate can be as important for some as love.

The Oddities of the New York City Property Tax Structure

2008-02-12T08:16:12Z

It is, in some of the social circles of the super-rich and super-famous, considered a necessary status symbol to have a swanky New York Apartment. You would expect that, in a civilized society, those who have more income than they know what to do with would be asked to pay higher property taxes than those struggling to get by. On the off chance that you are more cynical than that, you might still at least hope that the homes of the mega-rich are taxed at the same rates as the average person.

Welcome to New York City.

In this city, according to one viewpoint that is often decried as hyper-cynical, the super-rich basically tell others what's going to happen and how it's going to happen.

Before you decide that such sentiments are limited to the overly-sensitive feelings of out-of-touch leftists, consider the property taxes of this fair city. Rupert Murdoch – who recently bought the Wall Street Journal at a price that was about sixty percent greater than its value – has a home in an apartment that he bought several years ago for $44 million. It's probably worth considerably more than that these days. He pays an annual property tax of $55,000. While that may seem like a lot of money, it is, percentage-wise, equivalent to someone who has a $500,000 home paying a comically low $625.

There are many super-valuable NYC apartments that enjoy considerably greater tax-breaks than Mr. Murdoch's apartment.

Indeed, property taxes in the city are not based mainly on the typically-accepted progressive tax structure where the rich pay more; or even, for that matter, on a flat tax system, which is generally considered by mainstream economists to be barbarically regressive and terribly unhealthy for the economy.

They are based on a far more intricate tax-code that is filled with economic incentives and other measures that more often than not do more harm than good.

Measures that were written to encourage construction of low-income housing and other progressive goals are just as often exploited by the wealthy and their accountants in a ways that end up doing little more than robbing the city of revenue it desperately needs to fix an ailing public education and health system.

Though, to be fair the the NYC property tax code, it has strongly encouraged the construction of co-ops instead of condos. These co-ops did save the city from much of the subprime mortgage crisis that the countries banks helped bring on.

So, an attack on the unfairness of the tax code for NYC apartments is not a diatribe aimed at those who think government manipulation of the economy inherently leads to failure.

It is simply to say this: If you purchase a condo, you are much more likely to pay property taxes at higher rates than the wealthy who own some of the most luxurious co-op apartments in the city. Many corporations are similarly charged lower prices than most individuals.

Life isn't fair, but the tax code for New York apartments is really unfair.

Manhattan Real Estate Sets Record Year in 2007

2008-02-08T13:52:10Z

There hasn't been a year like 2007 for Manhattan real estate in a long time. And there probably won't be one like it for just as long. It saw a confluence of conflicting trends and market events that were enough to make the most brilliant economists' heads swoon. While the national housing market had literally its most devestating year since the Great Depression, New York homes shot up in value to levels that set new records in all sorts of categories.

A new year end report Corcoran Group Real Estate has given us some of the most reliable data to date on the 2007 market.

Perhaps most importantly, the value of NYC apartments and homes in Manhattan rose 8%, to an average of $1,105. Which, as we all understand at face value, is incredibly expensive. The average price for an apartment on the island rose to an astounding $1.395 million. That was a 12% increase over 2006 levels.

Different pieces of evidence suggest the market was primarily a seller's market for most of 2007. All-cash deals, for instance were transacted with a much greater regularity than the vast majority of US cities.

One of the most important trends in the NYC real estate market picked up pace in 2007: A larger and larger share of New York apartments are being sold as condominiums. Just about 55% of all completed deals in Manhattan this year involved condos. Similarly, condos experienced an average price increase of 9%, compared to 3% for apartments in co-op owned buildings.

Much of this disparity in price increases came from the rise of the luxury condo. Many such new condos that came on to the market in 2007 for the first time are in new buildings designed by some of the world's leading architects.

More anecdotally speaking, there is evidence of important changes taking place in some Manhattan neighborhoods. Districts that once offered little in the way of residential living have seen a good number of new residential buildings spring up. These changes are creating new living areas and neighborhoods, somehow magically cramming more living space in already crowded Manhattan. Examples include new living quarters in the Financial District and changes to the face of Hell's Kitchen. Similarly, Alphabet city continued in 2007 to become a safer neighborhood that has become a new cultural hotspot.

All in all, 2007 was a great year for New York apartments generally, especially Manhattan apartments. Growth in value started to taper off towards the end of the year, and there are signs of some trouble on the horizon, but even the most pessimistic predictions call for a drop in value of a considerably smaller scale than the gains that 2007 made. Furthermore, as much needed housing developments occur throughout the island, Manhattan's real estate market will only improve its ability to meet the high demand for its housing.

Where New York City Apartments Fall in the Global Economy

2008-02-01T16:44:51Z

At the beginning of 2007, when most mainstream economic analysts looked forward to what 2008 would be like, few of them got their predictions right. They all predicted slower rates of growth, both globally and in the US. But their predictions underestimated the effect of the subprime crisis, and for the most part, their predictions were quite off.

That's a bit of an understatement, really. For the most part, they got completely blindsided by the subprime crisis. Sure, many knew that it was coming, but few realized it was going to be as bad as it was.

The big thing they missed was the huge hit the big financial companies would take when, all of a sudden the liquid, easy-to-move mortgages that they traded back and forth became as illiquid as, well, what they, in effect, were: houses. A study by the International Monetary Fund detailed recently how the valuation models analysts used for these mortgage packages simply broke down as the going got rough, and a whole lot of companies lost a whole lot of money.

So, as the world's mainstream economic experts meet in Davos for their annual forum, the normal hyper-optimism and self-congratulations that float around the place aren't likely to be quite so prevalent this year.

Indeed, the Commerce Department just reported that last year was the worst year for the national housing market since the Great Depression.

However, in the world's financial capitals – New York, London and Hong Kong – the economy is still comparatively solid.

The same goes for their real estate markets. No one expects 2008 to be as kind to their real estate markets as 2007 was, but each city enjoys a combination of limited space and significant predicted economic growth.

Indeed, in the case of the value of New York apartments, the city is relatively sheltered from the subprime crisis in two major ways: First, the city's co-ops have kept an adequate level of regulation in place to make up for governmental malfeasance. This has largely protected the city from the direct impact of the subprime crisis. Second, the falling dollar has increased foreign demand for US housing. When foreigners think of US housing, they tend to think of NYC apartments. NYC is our most famous city – except maybe Hollywood – and citizens of other countries have thusly been buying NYC apartments at a breakneck pace.

So, even though the US financial industry, which is centered in New York City, has largely been responsible for the past two recessions, the city's apartment market shall be relatively sheltered from the storm some of its inhabitants have brewed.

While the market definitely will not have a great year in 2008, things won't be so bad that savvy buyers and sellers can't make great deals, and there will most certainly be much profit to be had.

It'll be no thanks, though, to the right-leaning economic experts meeting in Davos this year.

Foreign Buyers Can't Get Enough of New York City

2008-01-29T07:52:54Z

I would imagine that at some point soon, the Treasury Department and the Federal Reserve will start receiving thank-you notes from New York City realtors: The falling dollar has made New York apartments an incredible value for those that earn their salaries in currencies other than the US dollar. Even the Canadian Dollar is worth more than the US dollar these days – And when a currency called “the loonie” by its countrymen is worth more than the good ol' greenback, you know things have changed.

But the cheaper it is to buy dollars, the cheaper New York apartments are for those that earn money in yens, euros and British pounds. The lower the price, the higher the demand. Hence why New York realtors, if they are the least bit polite, should be sending volumes upon volumes of thank-you cards to those responsible for the declining dollar.

All of this, however, has been in the public's eye for some time. The assumption has been that New York City, like other major American cities, would benefit from this increase in demand. What hasn't been obvious until now, though, is that New York City has benefited more from foreign demand than any other American city.

Perhaps because it has been largely sheltered from the subprime crisis, or perhaps becase of its international allure, it seems foreign realtors have fallen in love with New York City. The Association of Foreign Investors in Real Estate (AFIRE) has just released a survey of their members that has ranked New York City the number one city for foreign real estate investment in the world.

Washington D.C. is the second-highest ranked city, followed by London, Paris and then Shanghai.

Surprisingly, given the recent turmoil in the real estate and credit markets, the survey ranked the U.S. as the “most stable and secure” country for real estate investment. This may be, in part, because of the higher levels of transparency in U.S. companies and markets that foreign investors often find refreshing and reassuring.

These two statistics mean that, across the globe, realtors will be be directing foreign buyers to New York apartments in greater numbers than in years past; more so than other American city.

Foreign demand will only increase if the dollar falls further. Furthermore, as the roughly million homes that are estimated to foreclose in 2008 due to subprime-related reasons start foreclosing, much of New York City – Manhattan especially – will look comparatively even safer. This should further concentrate the foreign demand for U.S. housing into the New York City real estate market.

Renting and Buying Real Estate in Miami

2008-01-22T08:28:39Z

Miami has been steadily growing for the past decade. Since 2000, the population has grown 11.5%, from 362,470 residents to 404,048. Much of this growth is from older Americans. Indeed, its reputation as a Mecca for retirees is well earned: At almost thirty-eight years, the average age of residents of the city is one of the oldest in the country.

Its reputation as a glitzy city full of wealth, however, may be a bit overstated. In 2005, the median household income of its residents was considerably less than the national average, at about $25,000. The average home during the same year, however, cost swell over $400,000. These two statistics suggest that Miami is largely a city of renters. And this turns out to be true: almost 60% of the population rents. Furthermore, only about thirty percent of the residents individually own their own home.

The above statistics are a numerical way of describing one of Miami's defining features: It is a regional hub for finance and other industries, which leads to a significant class of wealthy professionals, but its working class is considerably poorer than in most other parts of the country.

Regardless of the social problems that lie just below the surface, Miami has some of the best weather in the country, and the whole place is imbued with the natural beauty of the area.

The price of buying a home combines with the Miami real estate market's rapidly changing dynamics to make the search for a home in Miami even more important than in most cities. There are a number of ways to find an apartment or house to buy or rent here. Newspaper listings, though constantly shrinking due to the growth in online listings, are still popular here, even though they can’t be
efficiently searched. There are several online real estate companies that offer more complete services and extensive listings. All of them allow users to search listings by size and price, but few offer more possibilities than that.

There is one, website, however, that has extremely in-depth set of search options, for both renting and buying. City Cribs – allows users to search for a home by the details of the house that are important to them. If, for instance, they are only interested in a 3-bedroom furnished apartment with laundry and no parking, where landloards allow pets and there are no realtor fees, they can search for that,as well. Even the various results can be sorted in six different ways.

New York City Vacancy Rate Increases; Luxury Market Still Tough to Navigate

2008-01-16T07:39:58Z

Renting an apartment in New York City is definitely not easy, or cheap. In fact, up until recently, New York apartments were considered the most difficult to rent by Marcus & Millichap's National Apartment Index, which evaluates the 43 most populous rental markets. Surprisingly, though, a mild uptick in vacancy rates in New York apartments in 2007 has pushed the city down to the number three spot in the index. Currently, both San Francisco and Seattle are considered tougher places to get apartments by the good people at Marcus & Millichap.

There's one aspect of renting an apartment that New York City still holds the crown in: luxury apartments. The city offers more luxury apartments – both total and per capita – than any other major city in the country. The nation's financial industry is, after all, one of the most profitable industries in the country, and the wealthy victors in the world's financial battles – as well as the well-compensated losers – all need a place to lay their head in the Big Apple as much as the next guy.

Renting a luxury apartment is, in many ways, a lot easier of a task than purchasing one. This is mainly because most of the luxury New York apartments for sale are (in)famous coops. Coops don't, of course, condone such plebeian processes as renting an apartment. Furthermore, the process of being allowed to own an apartment in some of these buildings often involves interviews – which often don't go well – and a number of other unique screening mechanisms that are just no fun to be on the receiving end of – especially if you end up getting rejected.

Renting may be a bit easier, but unless you are only planning on being in the city for a very short amount of time, it is usually a bad investment. And if you are looking for a luxury apartment, you probably have the money to own.

Fortunately, a number of new luxury condos are being built, as are a good amount of ordinary luxury apartments. That being said, though, vacancy rates remain, despite their recent minor uptick, low by historical standards. This is especially true for luxury apartments, which are less effected by economic downturns such as the one that the nation is currently experiencing.

So, it makes good sense to make as efficient use of your apartment searching time as possible. There are several websites that offer customized searches that are particularly useful for luxury apartments. www.citycribs.com is one example. It has the best search engine and listings on the net. Elika Associates is a leading New York luxury buyer's broker, which offers the most high-end service available for those looking for luxury New York City apartments . Their website is www.elikaassociates.comn

New York City Maintains its Ignoble Crown

2008-01-12T12:01:52Z

For a good number of years now, renters of NYC apartments have had the extreme displeasure of paying the highest rents in the country. A new report suggests that the city is entering 2008 with a continuing hold on the unfortunate and smudged crown which signifies its role as the most expensive city for renters in the country.

The new report – by the major California real estate investment firm, Marcus & Millichap – suggests that, at least insofar as median rental rates, NYC apartments far surpass those any other city in the country. The median, for those that always get them confused, is the number that is number that occurs most often in a set. So, when we say New York City's apartments cost a median monthly rent of $2,922, what we are really saying is that more New York apartments cost $2,922 for rent a month than any other price. It's a seemingly small difference between average – or mean – rental rates, but it's an important difference.

Median rates are a better representative of what the typical person pays, because it's not thrown off by the super-high numbers – the luxury rental NYC apartments, in this case – like the mean rental rates would be. It's a funny thing about New York City, though: In many cities, 2,922 dollars would get you something approaching a luxury apartment.

Here, though, it gets you the median. Can't you almost feel those dollars just pouring out of your wallet, like a crisp waterfall on a spring day? Sometimes I think landlords in the city just sit outside and watch people walk in and out of their buildings and make a cash register noise inside their heads, “ka-ching, ka-ching,” as their tenants walk by.

The next closest city was San Francisco, but its median rental rate was a full thousand dollars less than New York City. It stood at just $1,904.

In fairness to the equally cash-pressed San Franciscans, though, these numbers are a bit deceiving. New Yorkers tend to cram more people into their apartments, so even though the apartments themselves are more expensive, those that life in the City by the Bay actually pay more per person.

The report notes that there is more than just supply and demand driving rental rates in the city up. Of course, New York City and San Francisco's low vacancy rates force prices upwards, but the regional inflation stemming from the high income of New Yorkers and San Franciscans is what makes rental rates so astronomically high in these two cities.

Of course, while this means that rental rates are acceptable for high income earners, it means that the working class in New York City is pressed harder by the high rental rates than in any other city in the country.

Renting and Buying a Home in Dallas

2008-01-06T20:11:30Z

The Dallas real estate market was hit hard by over-speculation and the savings and loan scandals of the 1980s real estate boom. After almost two decades, the low property values and relatively little building combined with the strong Dallas economy to attract significant investment in the area, both by the growing population and investors.

The diversity of the city is one of its main strengths. There are about 1.2 million residents in total. About thirty percent of them are Hispanic, a third Caucasian and a little over a quarter of them are of African-American descent.

The property values of the city vary greatly from neighborhood to neighborhood. There is both incredible wealth and poverty here. This disparity of wealth is, sadly, one of the defining features of life in Dallas. While this is true for most American cities, it is even more stark in Dallas.

About fifty-four percent of the population rents. The median gross rent – which means the total rent that someone living in the city is most likely to pay – was $685 dollars a month. In 2005, those that buy payed an average price of $120,900.

While it is easier to find a good home to rent or buy here than it is in most cities, it is still usually a difficult task. Someone looking for a home should use the most efficient methods possible

There are several ways to find a home to buy or rent here. Newspaper listings, while constantly shrinking due to the growth in online listings, are still popular in Dallas, even though they can’t be efficiently searched. There are a few online real estate companies that offer more complete services and extensive listings. All of them allow users to search listings by size and price, but few offer more possibilities and services bthan that.

One, website, however, has by far the most in-depth set of search options, for both renting and buying. City Cribs – allows users to search for a home by the details of the house that are important to them. If a user, for instance, is looking for a place with a balcony, they can search just among the homes that have one. Or, if they are only interested in 3-bedroom furnished apartments with laundry and parking, pets allowed and no move-in fees, they can search among just the homes that offer those things, as well. Even the results can be sorted in six different ways.

Buying and Renting a Home in Austin

2008-01-02T17:49:55Z

Austin is often called the cultural capital of the South. The city claims to have more live music acts on a weekly basis than any city in the World. While this is doubtful given its size – 1.5 million people in the greater metropolitan area – it is certainly home to one of the most vibrant music scenes in the country. Money magazine rated it the second best big city in the country to live in.

In part because it is home to the University of Texas’ flagship university, which is one of the largest universities in the United States, it is an exceptionally young city. The average age of Austin’s residents is just slightly under thirty years old.
Furthermore, it is about as diverse a city as can be: The population is roughly one quarter non-hispanic white, African-American, Caucasian and various other races.

Despite this vibrancy, Austin real estate is still relatively affordable. Furthermore, the general cost of living is about ten percent lower than the national average. The average home price last year was just $175,900, which was a 9.5% increase from the previous year. A little over half of the homes in the city are rentals.

The occupancy rate was 96%. This is about the same as Boston or other cities of similar size, but the average rental prices for 2005 was just $740. With this combination of vibrancy and low cost of living, home values are bound to increase, at least in the medium to long term.

There are a bunch of different ways to find a home to buy or rent here. Newspaper listings, while shrinking each year due to the growth in online listings, are still popular here, even though they can’t be searched effeciently. There are several online real estate companies that offer more complete services and extensive listings. All of them allow their users to search listings by size and price, but few offer more services than that.

One, website, however, has easily the most in-depth set of search options, for both renting and buying. City Cribs – allows users to search for a home by the details of the house that are important to them. If a potential renter, for instance, is looking for a place with a balcony, they can search just among the homes that have one. Or, if they are just interested in 2 -bedroom, unfurnished apartments with laundry and parking and pets allowed they can search for that, too. Furthermore, the results can be sorted and displayed in a number of useful different ways.

Renting and Buying a Home in Chicago

2007-12-18T12:41:15Z

The third largest city in the United States and the largest in the Midwest, Chicago is one of the most archetypal American cities. Its three million residents live at the spot where the great lakes meet the mighty Mississippi River, and its booming economy reflects this fact.

Its booming economy, in turn, is reflected in its high cost of living, which is a solid 37.5% above the national average. Home prices go a long way in explaining this: The average home is valued at about $424,700.
That being said, the average rental rate is not particularly high, just $783 dollars with mandatory utilities like heat and hotwater included.

One of the reasons that Chicago is such a sought-after city to live in is its diversity: The city is about 37% African-American, 31.8% Caucasian and 26% Hispanic.

The South Side has the lowest population density; the North Side has the highest median income; the West Side has the highest crime rate and the biggest problems with urban decay; and the downtown area is the most popular, busy section of town.

The average home value is particularly high given that the average age of homes is a solid fifty-five years. Despite the age of the residential buildings, property values continue to increase, with the average price of homes increasing a heady 18% from the previous year.

There are a number of ways to find an apartment or house to buy or rent here. Newspaper listings, while constantly shrinking due to the growth in online listings, are still popular here, even though they can’t be efficiently searched. There are several online real estate companies that offer more complete services and extensive listings. All of them allow users to search listings by size and price, but few offer more possibilities than that.

One, website, however, has by far the most in-depth set of search options, for both renting and buying. City Cribs Chicago Real Estate – allows users to search for a home by the details of the house that are important to them. If a user, for instance, is looking for a place with a balcony, they can search just among the homes that have one. Or, if they are only interested in 3-bedroomun furnished apartments with laundry and parking, with pets allowed and no move-in fees, they can search for that, too. Furthermore, the results can be sorted in six different ways.

Renting and Buying in Atlanta

2007-12-15T09:59:27Z

Right now, Atlanta is one of the most exciting cities in the country. Having been relatively poor during the seventies and eighties, its quality of life has been steadily improving for about two decades now. Since 2000, its median income has been increasing about a thousand dollars a year. For the past six years, its population has grown faster than any other city in the United States. Last year, violent crime was at its lowest levels since 1969. Perhaps the most illustrative statistic, though: More single-family homes have been built here than any other American city for not just the past year or two, but for the past thirteen.

Several fortune 100 companies call Atlanta home, including Coca-Cola – which actually owns Emory University’s campus – UPS and AT&T Mobility. The largest employer in the city is Delta, which uses Atlanta as its main connection airport.

Maybe because of the famous nightlife that exudes out of the Peachtree Street and Buckhead areas, Atlanta is one of the younger cities in the country: Its median age is just 31.9 years. Almost a third of the city is between the ages of twenty-five and forty-four. The young people, of course are the ones keeping Hotlanta hot.
Atlanta is as diverse as it is young. About 60% of the residents are African-American, a third are white, and the remaining seven percent come from pretty much everywhere.

Atlanta may be one of the easiest major cities to rent an apartment in. The average rental price in 2005 was just $638. A little over half the houses are rentals. In all there are just shy of 400,000 different households. The homes are particularly spacious: On average, there are 6.1 rooms per home.

There are a number of ways to find an apartment or house to buy or rent here. Newspaper listings, while constantly shrinking due to the growth in online listings, are still popular here, even though they can’t be efficiently searched. There are several online real estate companies that offer more complete services and extensive listings. All of them allow users to search listings by size and price, but few offer more possibilities than that. One, website, however, has by far the most in-depth set of search options, for both renting and buying Atlanta Real Estate. City Cribs – allows users to search for a home by the details of the house that are important to them. If a user, for instance, is looking for a place with a balcony, they can search just among the homes that have one. Or, if they are only interested in 3-bedroomun furnished apartments with laundry and parking, with pets allowed and no move-in fees, they can search for that, too. Furthermore, the results can be sorted in six different ways.

Renting and Buying in Boston

2007-12-11T23:51:37Z

One of the oldest cities in the United States, Boston currently houses more universities and colleges than any city in the country. Once the home to those that begun the Revolutionary War, Boston today is still the city of champions, with both the Red Sox and New England Patriots sitting high atop a mound trophies and vanquished foes.

The city itself has only 573,000 residents and is actually geographically quite small for a major city. But if the borders of the city were set up like New York City or L.A.'s, then the surrounding cities of Somerville, Cambridge, Medford, Arlington, Newton, Malden, Brookline, Revere and Chelsea would all be part of the city, and it would have a population of about 2 million. That's why you generally hear the phrase "the Boston Area" about as often as the word "Boston" itself.

Boston is also an expensive city. It's expensive to live here in general, and a big reason why that's true has to do with the cost of buying or renting a home. The median price of a home in the area is about $410,000. That figure is true despite how old most of the buildings are here. The median age of a rental building is 65 years, and that number takes into account all of the new homes that have been built in recent years, so you know there are a whole bunch of old buildings creaking around here.

For the most part, the Boston area sports a quality public transportation system with a large number of buses and quality subway lines. Be forewarned however, while most of the lines on "the T," as locals call it, are pretty quick, the Green line is horribly slow. This antiquated part of the public transport system effectively doubles the commute time for most homes in the Allston and Brighton regions of Boston.

The occupancy rate is 95.09%. That means that it is much easier to find a home here than it is in New York City - where occupancy rates are about 99% - but, compared with the rest of the country, it certainly isn't easy.

That being said, the market has indeed cooled in the past year, and there are a number of great deals to be found. They are not, however, easy to find. Residents of the city have keen memories of when it was nearly impossible to find a reasonable price here, and are quick to jump on homes that are good values. If you are intent on finding a great deal, use a highly customizable search engine to make your search process as efficient as possible. While the Boston Globe's web page has the largest selection of homes, CityCribs Boston Real Estate offers by far the most in-depth search engine, as well as one of the largest databases of available homes in the area.

The Future of the Housing Market

2007-12-07T18:36:51Z

The subprime mortgage crisis has extended itself throughout the economy. According the Congress' Joint Economic Committee, some 3.7 million homes will probably foreclose as a result of the crisis. As of August, according to their figures, 1.7 million of those homes have already foreclosed, and another 2 million are expected during the next two years. Some of the largest names in the financial industry are now subject to multiple lawsuits and are writing off tens of billions of dollars as lost.

What is most fascinating about the subprime crisis' effect on the housing market, however, is the economic geography of the market dynamics. Because so many of the houses that were mortgaged with subprime loans are in the same neighborhoods of various towns and cities across the country, the effect of the crisis has not been spread equally across the nation's cities and towns. Instead, it has left some cities, like New York City, largely untouched, but literally created new ghettos of neighborhoods in the cities hit hardest by the crisis, such as Cleveland, Ohio.

The short term future of the housing market looks grim. The Fed chief testified to Congress on Nov. 8th, noting that the housing market will suffer the worst of the consequences of the housing crisis from now until the end of 2008. During that time, 450,000 subprime mortgages will reset at higher interest rates each quarter. As the Chairman of the Federal Reserve, Professor Bernanke – who used to head the Economics department at Princeton – put it, “Delinquencies on these mortgages are likely to rise further in coming quarters as a sizable number of recent-vintage subprime loans experience their first interest rate resets... A sharp increase in foreclosed properties for sale could also weaken the already struggling housing market and thus, potentially, the broader economy.”

While some analysts are expecting the low mortgage rates – current 30-year rates fell to just 6.24% this week – to help the housing market rebound in the middle of 2008, that is treated by many, including the generally optimistic Federal Reserve Board, as wishful thinking. It is, after all, hard to an envision a scenario wherein the national real estate market will recover while in the middle of the worst of the subprime crisis.

A more likely scenario will probably play itself out in the last quarter of 2009, when improved consumer sentiment and several additional rate cuts by the federal reserve will have served to increase demand in the housing market sufficiently to turn a nascent rebound into a steady increase in the value of the nation's housing.

A Quick-Reference Guide to Manhattan for New Renters

2007-12-06T12:14:29Z

Manhattan is a big place. Many of its neighborhoods are larger than whole cities in other parts of the country. For those new to the city, it can often seem a daunting cityscape. This quick guide will provide a quick reference point for you as start to figure out what part of the island you would like find a New York apartment in.

Chelsea – A relatively expensive area to live, there are large numbers of clubs that people from across the city flock to. There is also a strong GLBT community here.

This is the toughest part of town to find an apartment. Vacancy rates were just 0.53% during the third quarter of 2007.

East Village – Home to Alphabet City, once considered one of the rougher parts of the city, the East Village today is populated by more and more twenty-somethings, and boasts a solid nightlife filled with a good number of quintessentially New York bars. NYU has a strong presence in this part of the city.

At 0.93%, vacancy rates are just slightly above Manhattan averages

Gramercy/Flatiron – Last year, Grammercy was home to the single largest real estate deal ever, in terms of dollar value. In a move that is sure to change the face of the area, the city sold a large public housing complex for many billions of dollars. Outside of the public housing, this is the third most expensive part of Manhattan to rent an apartment in.

Harlem – Long one of the most notorious urban areas in the country, Harlem today is experiencing a bit of a renaissance. The Clinton Foundation houses its offices here, and a number of urban renewal projects are taking place here.

Rents remain relatively low. During the third quarter, it cost just $2,179 on average for a 3-bedroom apartment.

Upper West Side – Fans of Seinfeld will recognize much of this area. Scenes from the show almost always took place in this part of New York.

Vacancy rates are 0.87%, which is just about the average for the island.

Upper East Side – One of the wealthiest parts of the city, it is considerably easier to find a single or flat here than it is a three bedroom apartment.

Soho/Tribeca – The single most expensive part of the city to rent an apartment in, the area boasts a number of warehouses converted into large flats. It is home to the famous Tribeca Film Festival.

The vacancy rate is 0.93%; a single will cost you a hefty $3,555 on average.

Midtown – Just south of the park, midtown east and midtown west are home to some of the most famous parts of the city. Madison Square Garden is here, as is Penn Station.

Western Village – Perhaps the most European feeling part of the city, the Western Village is home to a large number of British style pubs.

Apartments are expensive here: A single costs an average of $3,082. A 3-bedroom is an average of $6,438.

Renter's Rights in New York City

2007-12-03T14:43:11Z

Tenants in New York have more rights than those that rent in most other states. A long history of urban housing problems has led to a significant amount of progressive legislation that effectively makes renter's rights much more important than a landlord's short term bottom line.

Just like with all types of rights, the rights of tenants are only useful if people know that they have them. This quick guide will outline some of your renter's rights that are most often violated by the landlord or building owners.

Firsts and foremost: Discrimination in housing – including on the basis of sexual orientation – in any facet of the housing market is legally forbidden, and New York City has a particularly strong Human Rights Commission that helps enforce anti-housing discrimination statutes. If you think you've been the victim of discrimination either as a tenant or potential renter, contact the commission immediately.

Second, you have the right to a heated home from October 1 – May 31. If the heat doesn't work, or if the heat is below 68 degrees Fahrenheit during that time, then you have the right to withhold a portion of the next month's rent equatable to the portion of the month that the heat didn't work.

Likewise, you have the right to a safe, healthy and habitable New York City apartment enviroment. If the hot water doesn't work, or there is a rodent or bug infestation, that's the same as the heat not working in the middle of winter, and you should act accordingly.

The guarantees of safety also mean that, if you are in a basement or ground floor, you have the right to working window protectors that keep anyone from coming through your window, as well as the right to an appropriate number of smoke alarms throughout your apartment.

Similarly, you have the right to at all times have a working lock on your door that keeps everybody that doesn't have a key out.

One of the least known tenant rights is the right to have a mirror in all service elevators. This gives everybody the right to see if there is anybody in the elevator before getting in, and cuts down slightly on crime rates.

Perhaps most importantly, the landlord does not have the right to evict you without a court order. Only a court order can lead to you eviction, no matter what an irate landlord might say.

In sum, renters have the right to safety, warmth, a healthy environment and all the other aspects of having a home so important. These things are quality of life issues for you to debate with your landlord, they are rights that should never be violated. If they are, the New York City housing courts are a powerful way for tenants to make sure that they are financially compensated.

When trying to find the perfect New York Apartment, resources like CityCribs.com provides an easy to use and comprehensive selection of rental properties.