Apparently, foreclosures do happen in prime Manhattan neighborhoods.

Oops. Here's the link:
http://www.streeteasy.com/nyc/building/203-west-81-street-manhattan

That's kind of uncalled for. Hello...Streeteasy moderator?...What is the point of keeping a post like thebelltollsforthee's?

west81st - very interesting and thank you for that

don't know if it amounts to a trend, how common it is, etc.,
but it's interesting that the foreclosure situation did
not turn into a 40% discount - market is not too bad

ignore hate - let it bounce off

Interesting:
So, 3A is 2Br, 1bath - 1409sq.ft went for $1,132,000 - $803/sq.ft

And total wreck in original condition on 7 Floor (2br, 1 bath - 1350sq.ft) went in to contract arround 5/22/2008 (Asking price was $1,479,000) I assume there was some negotibility, but still it's much higher/sq.ft taking to consideration that condition of 3A is a bit better.

West 81st, your writing is a little over the top, I think.

But your example isn't indicative of any larger trends. According to the Observer, there were just 15 foreclosures in Manhattan in April.

http://www.observer.com/2008/l-foreclosure-rate-13-times-higher-new-yorks

ali r.
{downtown broker}

Yeah, wow, two foreclosures in ALL of Manhattan - there's a real trend....

It takes a year or more to foreclose in NYS.

ARMs here aren't resetting for another 2 years.

Be patient, young grasshoppers.

west81st, you say the pricing on the Corcoran listing does not look good. Do you think a significant discount is possible, especially if it were an all-cash transaction? Where exactly in the foreclosure process do you think this unit is? thanks.

You really are chomping at the bit, aren't you, Steve?

I guess lots of bad things will happen if we're just patient, huh?

with so many people waiting, it's hardly a crash, is it?

lowery, you nailed it.

Kylewest: Don't sweat it.

BellTolls/ FrontPorch: Sorry if my lame attempt at an inside Jewish-conspiracy-theory joke gave offense. For what it's worth, I have nothing against speculators, whether they wear black hats or mink coats. A certain measure of speculation is a necessary feature of all free markets. The real question, which I expressed very poorly, is the extent to which speculation has inflated the bubble; and perhaps more importantly, the extent to which the market will deflate as speculators like Mr. Meisner who jumped in just before the music stopped get burned, along with the bondholders who are stuck with their debt. Again, sorry for the poor presentation.

Lorimer: I read the history this way:
- #7A now belongs to the Terwin trust as REO, and can probably be had rather cheap.
- #4B is probably pretty far along in the foreclosure process. The secretary of the condo board can probably steer you to the referee if you want to bid on it.
- #3A is sold, but Mr. Stavinsky might be interested in quick flip.
- #4A is for sale through Corcoran, and I doubt the agent will acknowledge any connection between his listing and the foreclosure sales.

One other thought: The Terwin Trust may have held the second lien on #7A, not (or in addation to) the first mortgage, and US Bank may have bought out the first lienholder at foreclosure to protect the second. Either way, the apartment is now REO. The only difference is the trust's current basis: most likely, it's around $1.1MM.

Along the same lines, note that I was probably wrong about the seconds being worthless. The second lienholder probably had some recovery from Mr. Stavinsky's purchase of #3A. As mentioned above, the second on #7A was probably defended at foreclosure. If I'm reading the evidence right on #7A, that apartment can probably be had now for somewhere around $1.2MM.

Malraux: Obviously, one speculator writing off his 10% doesn't constitute a trend, and Meisner stopped paying his common charges in 2006, so his situation doesn't say much about the market today (though the foreclosure prices might). Still, the Barrington is a nice building in a great location. If the rental market were really strong, why would this guy have walked away when positive cash flow should be a no-brainer?

"addation" s/b "addition.

West81st:

I don't know the answer to you query. I don't know who the guy is, his financial situation, or the first thing about him, his tribe, or his situation. I DO know that contrary to your post, foreclosures DO indeed happen in prime Manhattan neighborhoods, and have in the past. Last year year, I think all of prime Manhattan, south of 96th, had something like 9 foreclosures in total.

Check out the rent vs buy math for apartment 8E listed by Sothebys. Why bother buying if you can rent at that rate.

You should be prepared for a negative cash flow for a long time investing at current prices. See listing at 155 W 70 st - condo rental income = $2500/month, asking price = $725,000. With 20% down, monthly cash flow -$2500. It all works out if prices continue to rise at 10% per year.

mattthecat: You probably don't, unless you expect rapid appreciation.

Hqi is right about the key question: if non-resident owners can't attract rents that cover their expenses - as may be the case with 8E - how much negative cash flow will they absorb before walking away, especially if they're in a negative equity position? That's probably what happened with Meisner: between the original principal and the unpaid carrying costs, he didn't have much incentive to hold on. It's impossible to say, though, whether he was just an over-leveraged flake or the proverbial canary in the coal mine.

BTW, 8E sold for $840K in 2005. Even with the capitalized cost of renovations, the negative carry at $4150 might not be too bad.

West 81 – negative cash flow is a loss no matter how you look at it and unless there is expected appreciation in the near term it is a poor illiquid investment. The main benefit to owner occupied apartments is that the imputed rent is tax-free, while many of the expenses are tax deductible. This justifies the somewhat higher cost of ownership. Yes we (owners) all live in government subsidized housing.

It will be interesting to see what happens as ARMS continue to reset. My 5/1 at the beach reset up earlier this year, from around 4.75 to 6% -- but my 5/1 in the city, which resets in a few months, is actually coming down because the indices hit that little pocket in the credit crunch where rates were being subsidized like crazy.

ali r.
{downtown broker}

In a couple of posts above, I referred to #7A. Those references should have been to #6A. Sorry about that.

Went to the open house in this building #8E going for 1.23M. It's not bad for the price; the views just clears the rooftops of the adjacent buildings. The doors in the apartment are a little wierd for my tastes. e.g. bathroom door is a sliding door which seems to get stuck if it is closed at the wrong angle. The building seems ok eventhough the elevator is kinda tiny. Unfortunately, I don't know the floor plan or facing of the A line. But potentially getting a sub million 2bdrm isn't bad.

No way. Compare vs. prior sales. Compare vs. the same cost to rent.
Also, nothing is truly a 2 bedroom unless there is a second bath.

Hello all...

I am the Listing broker for 6A...it is not on th emarket as of yet..and it is occupied...Note: This foreclosure is not a classic situation of foreclosure. You will notice, that the original purchaser actually made a pretty penny....If you want some similar and more good reading look at 243 West 98th street, similar situation...The bottom line is, the volume of peopl ein New York, the limited supply of pre war condos, and the deisreable and accessible location of the property will still garner a higher price (vacant). The property will be delivered, as it stand now, with the rent controlled tenant. If you are looking for a "deal"..Consider zipcodes 10019 and 10069...

I have already received a few offers, which have been filed appropiately....

8E
02/23/2008 Listed in StreetEasy with Sotheby's at $1,230,000
06/24/2008 Price decreased to $1,150,000

still available to rent for $4150

Unit #3A at 220 Riverside Blvd. (Trump Place) is in foreclosure.

"This foreclosure is not a classic situation of foreclosure."

A foreclosure is still a foreclosure. The bank does not care what the original purchaser made, and neither do the neighbors who property values are brought down by the lower comps.

cavejohnson hardly seems literate.

I'm afraid all of this rampant speculation is a bit off the mark.

Apartments 3A, 6A and at least one (possibly two) other units in the building were owned by a troika of investors who deliberately bilked their mortgagee out of millions of dollars. The apartments they owned were occupied by rent-control tenants. The owners borrowed huge sums (approximately $1m) on valueless apartments with the explicit and deliberate intention of absconding with the money. Indeed, no payments were ever made and the borrower, Mr. Meisner, disappeared. (There is some suspicion that he may not really exist; the social security numbers/identity utilized to borrow the money may have been forged.) The apartments were foreclosed on, not because there is suddenly a spate of well-intentioned Manhattan homeowners who have suddenly gone broke and can't make their mortgage payments, but because the scam was structured precisely to lead to this ultimate result.

Rent control tenants paying well below market rate rents (approximately $600 - $700 for a 2.5 bedroom apt) remain in the premises. Nothing about the state of the market or the frequency of foreclosures in Manhattan in general should be extrapolated from what happened at the Barrington; the relatively large proportion of foreclosures, as well as the depressed prices, are the result of a well-planned scam initiated by owners of rent-control units seeking to cash out of valueless apartments.

"A foreclosure is still a foreclosure. The bank does not care what the original purchaser made, and neither do the neighbors who property values are brought down by the lower comps."

Exactly- no "good" can come out of it.

Actually, that's not entirely true. Appraisers are obligated to ignore foreclosure sale prices when assessing the value of a neighboring property. That some may not represents a dereliction of duty, but they are still required to not factor foreclosure prices into their analysis. In theory, then, neighbors' properties should not be brought down by the lower 'comps' that foreclosure sales yield.

In any event, the transactions at 203 W 81st street were not even conventional foreclosures, in the sense that they did not involve legitimate, well-intentioned borrowers who later defaulted on mortgages secured in good faith. What happened at the Barrington was a deliberate, calculated scam to bilk lenders of in excess of $3 million. Sadly, it worked.

SomeonewhoKnows: First of all, thank you for the information. It's very helpful, especially for those of us who live nearby and follow the Barrington with interest. Oddly, my lame joke about market manipulation in the original post turns out to be a lot closer to the truth than I intended.

I don't fully understand your contention that the foreclosure sale prices are of no consequence, or that the units are occupied and rent-controlled. If the apartments are "worthless", why did the trustee protect the lien on #6A at such high cost? And why did #3A sell for $1.132MM? Was the January buyer (Stavinsky) part of the scam? I don't see how that would have worked. Also, #3A went right back on the market with Elliman, vacant, at $1.75MM shortly after Stavinsky bought it. So your contention that it is occupied by a rent-controlled tenant seems somewhat dubious.

Lastly, to say the situation at the Barrington is irrelevant to the broader market, you have to assume that mortgage fraud was not widespread. That may be true; but considering the laxity of underwriting in recent years and the fact that these mortgages wound up in brand-name securitizations, it's also possible that fraudulent borrowing could contribute to a rising tide of foreclosures and/or distressed sales, especially if property values continue to soften. I doubt we'll see many cases as brazen as this one, but there's a broad continuum of fraud, from fibbing about income to inventing a borrower. Although some forms may be relatively innocent, they still increase the risk that a borrower won't or can't make his payments.

To answer your first question: Neither the trustee, nor presumably, its predecessor, had any idea at any point that the apartments were occupied with rent-control tenants. They had been duped into providing a loan for what they thought was a vacant, to-be-owner-occupied unit worth a minimum of $1.1M, and granted a loan on that basis. In reality, the Meisner acquisition was a fraud in which 'Meisner', or his puppetmaster, lied to the lender about the status of the unit and on that basis, the bank provided a loan. Immediately after receiving it, 'Meisner' disappeared without ever paying a cent back to the bank. The eventual trustee sold the property via foreclosure the same way they would any defaulted upon loan, without realizing that the apartment was occupied with a rent-control tenant and that the loan had been granted under false pretenses. That was why the asking price on 3A was as high as it was.

By the time 6A got around to be being sold, the bank was made aware of the rent-control status of the apartment and discounted the amount they were willing to take accordingly. A ~$200K hit on a $1m loan is a relatively significant hit to take, but that figure is still an insanely high amount of money for anyone to spend on a rent-control apartment. Incidentally, the tenant in that unit is a young woman with an even younger daughter.

I can't speak to how/why 3A went on the market shortly after he bought it (although you'll notice that it came off the market almost immediately after it went on.) I can, however, tell you with 100% certainty that at the time that 3A went into contract, and at the time that it closed for the $1.132M, the apartment was absolutely, positively, 100% occupied with a rent-control tenant.

As to your final point: I don't know what the case is outside of Manhattan, but in Manhattan, the number of explicitly fraudulent transactions consummated by deceptive BORROWERS that led to foreclosure is miniscule; other than what happened at the Barrington, the only other building in which a similar chain of events transpired is at another pre-war building a little bit further uptown on the west side. Given the fact that the vast majority of Manhattan's housing stock are co-ops (with intrusive boards), and not condos at which transactions can occur with virtually no oversight), it is almost impossible to perpetrate this kind of fraud on a broad scale. Further, the vast majority of condo buildings in Manhattan were built as condos, and after the expiration of rent-control laws; thus, there are very, very few buildings in Manhattan that were both built before 1971 and are presently operated as condos. The opportunities to perpetrate this type of fraud is highly limited -- too statistically insignificant to affect the Manhattan market as a whole.

SomeonewhoKnows: Thanks again.

I didn't mean to suggest that a wave of Abraham Meisners would tank the Manhattan condo market. Clearly, there's no way this particular type of scam could be perpetrated en masse. I just meant that there has been a lot of crappy lending during the real estate run-up, especially on condos. If a Merrill Lynch conduit took Abraham Meisner's second liens, there's probably an awful lot of poorly-underwritten junk of various sorts waiting to blow up if collateral values decline and incomes stagnate. Most of it isn't as toxic as Meisner's paper, to be sure, but it's probably lurking in much bigger volume.

Again, I'm not sure this is accurate. Even with all of the cataclysmic economic news and a nationwide housing slump, prices in Manhattan CONTINUE to rise. No, not at the same pace that they used to. And yes, there has been a significant decrease in the QUANTITY of transactions along with an alarming increase in the inventory on the market. All of that, logic would dictate is a recipe for plummeting prices. But, for whatever reason, so far Manhattan has bucked common sense and the prices here have risen, not fallen, even over the past tumultuous year.

Since the typical Manhattan borrower (whether because of co-op rules, PMI issues, or personal wealth) finances no more than 80% on an apartment purchase, and in light of the fact that Manhattan property prices have increased (if erratically), there is almost always enough equity in an apartment for an owner in financial trouble to sell and cash out of what is likely his most valuable asset. As a result of those two factors - relatively low L-to-V numbers and a steady or appreciating market that ensures retention of equity - there are very, very few foreclosures in Manhattan. In almost every instance in which an apartment does make it to that stage, it's either because there's some kind of shenanigans brewing under the surface (a la the Barrington) or the owner is in denial/insane. Otherwise, there is no reason for just about anything in Manhattan to get foreclosed on, and the very, very small number of foreclosures bears that point out.

> prices in Manhattan CONTINUE to rise

Actually, they aren't. Medians and means are one thing, but prices for the same apartments are already showing declines.

Just look at co-ops as a whole... even the median is declining there.

According to Miller Samuel, the preeminent appraiser and charter of real-estate trends in the City, prices on co-ops are indeed up in Manhattan. By any standard of measure that you choose: average price per square foot, average sales price, or median sales price, the numbers in 2nd Quarter '08 in Manhattan are higher than those of 2nd Quarter '07 or First Quarter '08 on studios, one-bedrooms, two-bedrooms, and three-bedrooms. The only class of co-ops in which prices declined are 4-bedrooms, an exceedingly rare commodity with by far the fewest number of sales.

Someonewhoknows: Your case for the solidity of the Manhattan market is somewhat circular: essentially, you're saying that prices can't fall because they never have, and foreclosures won't happen because prices can't fall - at any rate, not enough to put a significant number of borrowers in a negative-equity position.

First, I would point out that Manhattan prices HAVE fallen in the past (though you have to be at least 30 years old to remember it), and they may arguably be starting to fall again, based on same-unit and comparable-unit sales. More important, even if there had never been a bear market in Manhattan real estate, that wouldn't rule out the possibility of one starting today.

As we've seen across the country, fraudulent borrowing is relatively unimportant in a rising market. Lenders may even condone or encourage it, since it allows more origination volume. But once values start to slip, fraudulent borrowers are the first to default. That's why stated income/NINA/"liars'" loans have been the canaries in the sub-prime coal mine.

For what it's worth, I am over 30 years old. The downturn in the market in the early 90s can be attributed to three MAJOR factors that don't exist today. 1) Interest rates were two and a half times what they are now. Those rates quickly ate up whatever equity homeowners had, and for many, it became cheaper to walk away. 2) The city was overridden with crime in those days. Outlying areas were considered uninhabitable, and the suburbanization movement of the 50s was still compelling families to prefer running out of the City as soon as they had the means to do so. That has been entirely reversed by an urban renaissance, and high gas and suburban tax prices, and historically low crime rates that hves made city living more desirable than ever. 3) Rents in the early 90s were a miniscule fraction of what they are today, making buying a less appealing option.

All that said, I didn't argue that prices can't fall in Manhattan at all - of course they can. I was simply arguing that the data is clear that they haven't fallen, despite doomsdayers' data-less assessments to the contrary. There are indeed a number of reasons to believe that Manhattan is largely inured to the factors that have caused other bubbled-out parts of the country to pop: the fact that the apartment market here cannot be driven by speculators (due to stringent co-op rules that frown on investors); the fact that NYC has a constant influx of both new immigrants or new generations of old immigrants, each of which have an acute need for housing; the fact that the Giuliani/Bloomberg crime-stopping policies have insured that there are 'no bad neighborhoods', and that every area is desirable to people of various home-owning means; the fact the island is limited in size, and even with a construction boom, there is still always going to be an acute shortage of housing; the widespread existence of rent-stabilization, which cut-off a significant percentage of apartments from middle-class would-be renters not lucky enough to have gotten in on the cheap, who have to instead vie for the more limited number of higher-rent apartments, making buying a more attractive option; historically low-interest rates, etc. All of that mitigates in favor of Manhattan withstanding the kinds of downturns that deleteriously affect national housing prices. But does any of that mean that Manhattan CANNOT have a downturn in prices? Absolutely not.

As for the second point, foreclosures really DON'T happen in Manhattan - not at the rate at which they occur in the outer-boros or in the rest of the country, and with good reason (explained in my previous posting above.) The number of foreclosures here is infinitesimally small compared to the number of home/apartment owners here. And again, irrespective of how grave a given homeowner's personal financial situation may be, in most cases, he has to be an idiot to allow himself to be foreclosed on nowadays. As long as prices don't decline - and they haven't, yet - 80% financing rules dictate that an apartment owner MUST have some equity in his unit even if he never made a single mortgage payment to the bank. If he runs into financial trouble, in virtually all cases he should be able to sell his apartment, pay off the lien, and walk away with at least a little bit of cash in his pocket. If he doesn't, and allows himself to be foreclosed on, then he has his head in the sand. In Manhattan, unlike in the rest of the country, allowing yourself to get to the stage of losing your apartment to foreclosure has as much to do with a person's stubbornness and stupidity as it does with a person's financial means, or lack thereof.

Someonewhoknows: Excellent post, and I mostly agree. I would just carve out two caveats:

1) If the market were to slip 20-30%, a lot of owners would be upside-down - especially in condos. I have no opinion about how likely that scenario is, but if it were to happen, the same factors that cause borrows to hand over their keys in other places would apply here too. Sharp drops in collateral values create negative equity; negative equity is closely correlated with foreclosures, for obvious reasons. That's nearly as true in Manhattan as it is in the Bronx, Miami or Detroit; I understand the various mitigating factors in Manhattan, but the main difference is that we haven't had a sharp drop in values here. Maybe we won't. My point is simply that if we did, much of the same basic domino effect would probably apply here as elsewhere.

2) Condos - if they fell - would probably also pull coop prices down, because of easy substitution. Most buyers do not have a strong preference for coops over condos, so coop owners who needed to sell in a down market would have no choice but to compete with condo pricing. A flight to quality would protect some coops - in general, the most attractive properties - but not most. So while it's true that coops are generally much less vulnerable to foreclosure, they are nearly as vulnerable to the effects of a downward price spiral.

Is 20-30% on a $1m condo that much money to lose. Also, I strongly believe buyers definitely have a strong preference for condos over coops. That's why people would pay more for a condo.

Julia - I agree about condos vs. coops. I just took a softer position: that there isn't a widespread preference for coops over condos. By the way, in a bear market for condos, a flight to quality might make financially solid coops more attractive (relative to condos and shaky coops), but not to the point where most coops would be immune to the effects of sinking condo prices.

The most convincing argument for NYC coops and condos is the change in migration patterns. There are still young couples who move to the suburbs, but it is only one trajectory among many, and the no bad neighborhood phenomenon is as much because people choose to live in the city, especially anywhere in Manhattan as it is who is mayor.

4A and 4B in 220 riverside blvd is in trouble too. Something dubious about the Nestseekers and the sellers.

Someonewhoknows: "The downturn in the market in the early 90s can be attributed to three MAJOR factors that don't exist today. 1) Interest rates were two and a half times what they are now."

Not really. http://www.hsh.com/indices/nmcr90s.html

Check out rates on jumbo 30-year ARM's - they're lower than in the very early 1990's but about the same as they were after that.

2) The city was overridden with crime in those days.

Not really. http://www.eurekalert.org/pub_releases/2007-02/uoc--nrr021207.php

The crime rate hit a peak in 1990 and fell precipitously after that.

3) Outlying areas were considered uninhabitable, and the suburbanization movement of the 50s was still compelling families to prefer running out of the City as soon as they had the means to do so.

Not really. http://www.infoplease.com/ipa/A0763098.html

New York City's population grew consistently from 1990 through the present

[split answer]
4) Rents in the early 90s were a miniscule fraction of what they are today, making buying a less appealing option.

Not true. http://goliath.ecnext.com/coms2/summary_0199-1912287_ITM

In the early 1990's there were fewer market rentals, therefore the housing stock was frozen: controlled and stabilized units were the norm, and they have a turnover rate of about 1% per year. To get out of this, there were massive co-op conversions starting in the 1980's, which reduced the stock of rentals even further.

5) "There are indeed a number of reasons to believe that Manhattan is largely inured to the factors that have caused other bubbled-out parts of the country to pop."

Aaah! The "New York is special" argument.

How's about considering some of the things that make this bubble unique to Manhattan?

1) 33% of purchasers in Manhattan work on Wall Street, which is being decimated, employees are being fired, bonuses are being slashed, bonuses are being paid in depreciated restricted stock rather than cash, and banks are not considering an employee's full bonus when applying for a mortgage, with down payments of 30% being demanded.

2) 30,000 building permits were issued in Manhattan from 2003-2006, which is 3x the number of apartments that typically sell in Manhattan in a single year, leading to a glut of inventory.

3) 30-year fixed jumbo loans are at some banks (BofA) being offered at 8.5%?

4) There is now a 1-year supply of inventory on the market.

5) The rent-to-price ratio hovers around 24x, twice the historical average.

6) Prices have increased up to sevenfold in 10 years, a better "return" than even Berkshire Hathaway.

"foreclosures really DON'T happen in Manhattan - not at the rate at which they occur in the outer-boros or in the rest of the country."

Even if that were true - and it's not - foreclosures in the outer boroughs do affect prices in Manhattan.

2) 60% of all mortgages in Manhattan are jumbo ARM's.

It might be time to write this thread off as a hijacking victim.

I like the Abraham Meisner story. It would make a good novel: say, a hard-boiled detective story ("Dead Men Don't Buy Condos"), or maybe a chicken-soup comic romp ("Tuesday the Rabbi Defaulted").

Julia - I think 20-30% on a $1MM condo is a HUGE amount of money to lose. The income of someone buying that apartment is likely $300K-$400K, which, after taxes, 401K contributions, etc. is half that, or $150K-$200K. So the loss is well over a full year's after-tax income. That's pretty significant in my book.

See above for another misleading post from steve with out-of-context cites to articles. Interest rates were significantly higher in the early 90s compared to know, enough make a difference in price and buying decisions. Crime was also much, much worse back then compared to now. There are neighborhoods in Manhattan and the outer boroughs that you walk through now, and you would never believe the crime and mess they were in the early 90s. I'm not sure what rents were like back then, but given the lack of accuracy of most of steve's statements, I wouldn't trust him on that one either.

"According to Miller Samuel, the preeminent appraiser and charter of real-estate trends in the City, prices on co-ops are indeed up in Manhattan. By any standard of measure that you choose: average price per square foot, average sales price, or median sales price, the numbers in 2nd Quarter '08 in Manhattan are higher than those of 2nd Quarter '07 or First Quarter '08 on studios, one-bedrooms, two-bedrooms, and three-bedrooms. The only class of co-ops in which prices declined are 4-bedrooms, an exceedingly rare commodity with by far the fewest number of sales."

2 bedroom co-op prices are down 2% month over month.

"4A and 4B in 220 riverside blvd is in trouble too. Something dubious about the Nestseekers and the sellers."

Are these units in foreclosure?

Thats what we think.. I searched in Trulia and in this website.. units were bought way high above the current asking price.. The brokers are not giving out an information. we were waiting for a week to hear back on our offer. There were no counter offers made.. We just heard the seller was not interested.. How could that be possible, when we made an offer close to his current asking price..

Perhaps the units are a short sale and since they might be listed for less than the mortgage amount owed, the owner needs to get approval from their lender, which can take a long time. Just specualtion of course...

Perhaps the units are a short sale and since they might be listed for less than the mortgage amount owed, the owner needs to get approval from their lender, which can take a long time. Just specualtion of course...

Perhaps the units are a short sale and since they might be listed for less than the mortgage amount owed, the owner needs to get approval from their lender, which can take a long time. Just specualtion of course...

LICC, I gave you first-hand figures from reliable sources, and yet again you accuse me of "another misleading post from steve with out-of-context cites to articles."

To you it seems something is "misleading" and "out-of-context" if you don't like what it says. What's misleading or out-of-context to post what ARM rates were in the 90's? Or crime rates? Or co-op conversions & their effect on the availability of rental properties?

Nothing. If what I'm saying isn't true, prove it with your own figures. But since you can't, like spunky before you, you make nonsense accusations. ;0

BTW: "There are neighborhoods in Manhattan and the outer boroughs that you walk through now, and you would never believe the crime and mess they were in the early 90s."

Who ever denied that? What you've never proved is that that reduction in crime was solely responsible for increased prices, or that crime didn't fall because incomes were rising, which was - via gentrification.

If you want to prove a cause and effect, then prove it. Don't imply something that sounds sweet, till you look at it and say, "Gee, there are parts of Flatbush I wouldn't touch even now. How come what LICC says isn't true for there?"

Minor postscript to our discussion of 203 West 81st:

SomeonewhoKnows has 26 apartments for sale. See http://www.streeteasy.com/nyc/talk/discussion/5003-i-have-26-apartments-for-sale-throughout-nyc

By concidence, the crown jewel of his collection happens to be at (drumroll)... the Barrington:

25) $1,750,000 - A recession-proof, absolute sanctuary in the City: rarely available 3-BR PRE-WAR condo in a doorman building in one of NYC's best neighborhoods. Across the street from Zabar's, H&H and all that the Upper West Side has to offer, this highly unique space features hardwood floors, wood-paneled walls, 1.5 baths, and a sense of luxury living. It even features funky wall-light fixtures that are old-school transylvani-ish. Space can be renovated to buyer's specs. Same-layout unit in the building recently sold for $2.05M. Save $300K! (Upper West Side, Manhattan)
$1,500 maintenance [NEAREST TRAINS: 1, 2, 3, B, C, D]

"Same-layout unit in the building recently sold for $2.05M" refers to the sale of #3D on 9/4/07.

Citing that comp is rather disingenuous, since #5D sold for $1.695 on 6/5/08. I guess "Overpay by $55K!" is a less compelling pitch than "Save $300K!"

I still appreciate the inside information SomeonewhoKnows brought to this thread; but I think his spin may be colored by his personal interest in protecting resale values at the Barrington.

Thanks for pointing that out - though I actually no longer am involved in the unit at the Barrington, and haven't been for a number of months. I had something of a connection to the owner (hence the inside info) but have been disassociated with it for some time. The inclusion of that listing in the list that I put up the other day was an error. My understanding is that unit 3A has been renovated.

That said, you have to compare apples to apples when assessing real estate comps, as I pointed out to you in the thread about the Trump buildings. This is even more true when you're talking about older buildings in prime neighborhoods where renovations can be EXTREMELY costly and have a TREMENDOUS impact on the quality of the units.

I happen to know (as in know with an absolute degree of certainty, not guessing) that 5D, which sold for $1.695M, was an unrenovated apartment. The same is true of 4A, which has the same layout, and which is currently in contract for the same price. These apartments need(ed) extensive, full-scale renovations which would run well into the hundreds of thousands of dollars.

The last FULLY RENOVATED 1,409 square foot apartment at the Barrington is indeed 3D, which sold (now over a year ago) for $2.05M. Until someone sells a comparably-equipped, similar sized unit (anything on the A or D line) for a lower price, that will be the most accurate comp to go by.

Apples to apples.

Incidentally, West81st, while your posts are highly informative, you seem to take great pleasure in the (projected) impending decline in Manhattan, and particularly, UWS real estate. Unless you're seriously in the market to buy and want to pay as little as possible (certainly understandable), your taking glee in the nervousness of thousands of your fellow UWSers is...odd.

SomeonewhoKnows: When a listing says, "Space can be renovated to buyer's specs," the statement invariably implies that the cost of renovations will be IN ADDITION TO the asking price. Otherwise, you'd be writing a blank check, which seems implausible.

Now you say the unit is already renovated, and that you no longer have an interest in it, and that it shouldn't have been listed among your "collection" at all. That's fine with me. As you say, I have no way of knowing what actually happened at the Barrington, and no good reason to care, aside from the general motive you already guessed above.

One other thing, SomeonewhoKnows: Your "I have 26 apartments..." post was an excellent piece of writing.

Thank you. I hope that wasn't meant sarcastically.

Not sarcastic at all. You're an excellent writer, and I respect good writing. Real estate listings would be a lot more fun if a few brokers had your flair.

BTW, I read your "Save $300K!" line as slightly tongue-in-cheek; I'm just not sure a sales pitch for a $1.75MM asset is the place for irony.

Oh, and one other thing, Sir (as Peter Falk used to say): I saw #4A in May. I'm not sure I agree with your assessment of the necessary renovations. Oh well - take it up with Greg Kammerer, not with me. He seems to think that apartment doesn't need a thing:

http://www.corcoran.com/property/listing.aspx?Region=NYC&listingid=1253273

Personally, I think a second full bath would be a good idea. But if your ex-apple is really #3A, then #4A is a solidly comparable apple. And if we ARE talking about #3A, how did Stavinsky get rid of the tenant? The old gas-leak-in-the-geezer's-kitchen trick?

Apt 4A was unlivable, no question about it. I saw it, too. Nobody, but nobody, was going to spend $1.595M and live in that thing in its condition. It requires a complete gut job.

The building has a couple of other vexing (though temporary) issues that have nothing to do with a general decline in real estate, which undoubtedly contributed to the relatively low closings since 3D in 9/07 and will continue to cast a cloud for the next few months. But this too shall pass.

Another update: #3A is back on the market - with "a quarter-million dollar top-to-bottom renovation (to be completed just after New Year's)" - for $1.95MM:
http://www.streeteasy.com/nyc/sale/370243-condo-203-west-81st-street-upper-west-side-new-york

Although there are other explanations for the exchange above, the most straightforward is that SomeonewhoKnows is also SomeonewhoLiedaLotinthisThread. It seems profoundly unlikely that the old $1.75MM price for #3A included the renovation.

some of those old posts are creepy...