market and predictions

What, you haven't unloaded the one you already have up there?

I did
that's why looking to buy an other one

Muromec, as I'm sure you're aware, you're in a bit of a rare spot. You mentioned before that you unloaded for a record PPSF in your building (direct buyer via Hauseit so no 6% right?) ... just wanted to point out that if you get a rebate on the buy side you'd actually be making money on this double sided transaction ... something to consider. Well done!

you sold your unit @ Adeline yet? or you live there?

not yet , keeping it for now ,
how about you? what do you plan?

not yet , keeping it for now ,
what about you? what do you plan?

we love the building and the area so we keep it. but will be renting it and moving to Roosevelt Island soon.

Keep your powder dry.

30 years , any predictions for 2017-2018?

Highly dependent on where interest rates go. If no change I see the market as down above $10 million, slightly down $5 million to $10 million, perhaps up $2 million to $5 million (not really up, but the numbers will look like it due to lots of new construction sales), $1 million to $ 2 million marginally up and below $2 million reasonable gains due to lack of product.

If interest rates go up any significant amount I see all hell breaking loose.

Even if interest rates don't go up, between the choking off of the Chinese money supply and the overbuilding of new units in the $30 million plus range I don't see how - even if there are a significant number of sales in that range - some developers won't choke on their inventory.

https://therealdeal.com/issues_articles/solving-nycs-condo-riddle/

One interesting thing about that article is that you see all these people whose market reports say prices have continued to climb or who have said basically the same thing when quoted in articles seemingly saying here that the market has already gone down.

30 - interesting thoughts.

Anecdotally, I just don't see many people thinking that now is a good time to buy a home in the city, and these are folks that would generally look in the $3m+ part of the market. The general feel of folks is that prices will fall. So this is consistent with your more professional view.

To me, that is the entire crux of the matter: in general either everyone feels they HAVE to buy before whatever they want becomes affordable, or NO ONE wants to buy because they think the market is going to fall. So you saying that the people who you know who would be buying in the $3 million plus range are going to sit it out until prices drop is a major indicator (to me, anyway) that until prices drop no one is buying.

There are two markets. New Development and Resale. New development prices have been falling and may fall further depending on how high the price is per sq ft. Resale prices were never that high and have increased at slow pace. That is why there are two different story lines. Nothing is happening to the resale market.

And a third - High $ resales at least above $5mm and resales priced over $2000 per sq ft.

300 - to be clear, I am just speaking from my social circles, not from any sort of study, etc. These are not folks looking to buy for investments, just for homes, but they typically don't differentiate between resale and new. It is just picking the right property in the right location for their lifestyle. Not saying they are typical or indicate of the market.

As actual rental prices fall (i.e. after concessions) and sale prices stop skyrocketing (i.e. the don't have to start falling, just stop going up) the investor condo market will make little sense to buy at these prices. So if half the market disappears.......

If you are seeking the best return on investment, you need to be ahead of the market and purchase in an area where there is room for growth. Both of the properties I own in the Bronx have gone up in value significantly in the last 3-5 years . Harlem will continue to rise but it's already risen a lot since the bad old days.

I have a question: what percentage of the market for new construction condos was made up of flippers over the last 5 years?

https://therealdeal.com/2017/08/07/luxury-contract-sales-volume-fell-to-7-month-low-last-week/

sounds like the entire market will go down sooner or later...

30 - while I tend to agree with your general sentiment on the direction the market will go (particularly the luxury sentiment), I don't think those luxury numbers (with respect to the number of signed contract) for the summer are far off from the historical summer slowdown. If you go the Olshan Report website, you can click on the links for past reports, and in comparing the previous summers it looks roughly similar. I think we'll need to wait until the fall to see where things go. I tend to agree with your view that the transaction volume will stay low (until prices drop significantly), but I think that we need to wait for a more traditionally busy season to test that.

If one wanted to buy a 3 bed condo in lower Manhattan within 5 years, where do you think prices will be? Buy now or wait?

so any predictions ?
harlem pricing?
looking up to 125th str

UU61, do you have 1 br or 2 br @ Adeline?

Urbandigs has an excellent website with $10/mo for charts. Plenty of useful info in there and much better than guessing.

Muromec, when are you looking to buy? 125th and up, especially on the west side continues to go up. There are some more aggressive projects in more central and east harlem that far north, but I doubt that someone who has $7mm to spend for a PH condo will choose to live in Harlem. I think under $2mm re-sales will continue to appreciate, beware the luxury segment above that range. Lastly, are you buying solo or working through Hauseit? Are you considering their home buyer rebate program?

directly, why do I need a buyers agent? its much easier to negotiate with sellers agent

muromec, it's because 95% of all inventory is listed by agents, so in almost all cases you might as well work with a buyer's agent because the advice is free, but also so you can get some of the commission that's built into the price back in your pocket. So basically, free advice, and some commission back at closing. Why would you say no to that?

This explains it much better than I can in a few sentences: https://www.hauseit.com/should-you-hire-a-buyers-broker-in-nyc/ Didn't you work w Hauseit on your home sale, self service it sounded like? Similar idea, assume you noticed that most buyers are represented.

The reason is because every agent will explain to them that having one is free. Otherwise you're giving the listing agent double commission. Why do that?

Because agents know-with direct deal they will get paid 2.5-3% more , no need to split commission. So now, here is an example. You are the sellers agent and you have two buyers- 980k direct buyer and 995k buyer with the agent- who will get the contract?

Because agents know-with direct deal they will get paid 2.5-3% more , no need to split commission. So now, here is an example. You are the sellers agent and you have two buyers- 980k direct buyer and 995k buyer with the agent- who will get the contract?

Because agents know-with direct deal they will get paid 2.5-3% more , no need to split the commission. So now, here is an example. You are the sellers agent and you have two buyers- 980k direct buyer and 995k buyer with the agent- who will get the contract?

Because agents know-with direct deal they will get paid 2.5-3% more , no need to split the commission. So now, here is an example. You are the sellers agent and you have two buyers- 980k direct buyer and 995k buyer with the agent- who will get the contract?

muromec-
I think this is a better example: There's an apartment asking $1 million even and the negotiation is stuck with the buyer at $980K and the seller is stuck at $995K. The broker will get a $58,800 commission at $980K. If they are co-broking it, they will get $29,400 commission. But if they are the sole broker, they can cut $15,000 off the commission, the buyer gets the price they want, the seller gets the net they want, and the broker collects $43,800 – still almost 50% more than if they had co-broked it – and “everybody wins”. Except, of course, the buyer doesn't get their own representation.

it can be different scenarios,
but the point is - why should you pay 30 K for seeing an apartment with the buyers broker , listed everywhere, when you can schedule appointment with the sellers agent ?

Which 1 br CONDO apt would you buy :
A) 23 west 116th str @ Adeline, 747 sq ft , 510 $/mo RE and CC total , 23 year tax abatement left
B) 40 west 116th str @ Kalahari 830 sq ft, junior 4 , can be possibly converted to small 2 br 1 ba, 780 $/mo RE and CC tax, 17 years of tax abatement left

same price - 850 K

It would have to be at gunpoint for either, as I think the tax abatements are a timebomb waiting to go off (even if you have the schedule of what you'll actually pay). Still, using the greater fool theory, I'd take the one with the 23 year abatement, as I'd have more time to find a greater fool.

Aaron2, agree with you in general but there are lots of greater fools out there, especially foreigners who lack experience and who think that tax abatements are of great value to the buyer. In truth, it is the seller (developer) who retains approx. 90% of the value for themselves according to economists. But if you resell with 15+ years remaining on abatement, I think you will find someone willing to pay a premium.

I personally think the concept that tax abatement in general and extending the 421a program in particular is NECESSARY for new development to occur is rubbish. All it does is increase sales prices at the expense of taxpayers. If there were no abatements, developers would simply be paying less for parcels to develop so their final costs would work out, not stop building. And based on how much new construction has been going on over the last decade I think the concept that anyone besides developers NEEDS a lot more new construction in most areas of NYC today is flawed.

So which apartment will be the best option?

If tax abatements were NECESSARY to sell units then there's a whole lot of people who aren't going to be able to sell their units over the next decade or so when these abatements expire.

My take is let's just say the tax is $600 in today's dollars, x 6 more years = $43.2K benefit. So imagine we are comparing a 807K smaller apt vs 850K bigger apt. The larger one is 11% bigger for 5% more $. We're left with deciding whether that extra sqft really exists, is put to good use, and the other differences in light, floor etc. are equal. You know better than most of us if that 53% higher maintenance is due to greater amenities and maintenance that actually help you, or too much staff/waste.

Could not agree with you more, 30. Tax abatement programs are a gift to developers who use their political influence to get these programs extended.

Hi Muromec, we've thought about that angle before when purchasing our first condo, but it turns out most firms (at least the bigger ones that aren't just individual brokers) have corporate policies against discounting their sell side commissions.

So we ended up working with an acquaintance "friend." No rebate though. Obviously annoyed about that now knowing that you can apparently get one. Especially since this girl did absolutely nothing besides relay our offer. Huge favor to her, though she did stop by with a bottle of champagne. Hoped it would have been a check though.

Either way, don't think there's any issue working with a buyer's agent, rebate or not. But I would definitely work with a normal agent, not someone who the other regular agents will dislike or boycott. No point hurting your chances of getting a deal in the first place. Good luck!