5sl (LIC) - 5 to 10% price reductions across the board

Still vastly overpriced. Nearly $1,000 psf to live in the middle of nowhere.

stevejhx, check the math on that - they're in the $640-$800 psf range. Most likely still high for the location, but let's not exaggerate given the facts presented here.

Waterfront property directly across from midtown Manhattan and a 5 minute subway ride to Grand Central is the "middle of nowhere" according to steve . . .

I agree its not middle of nowhere, but a couple blocks from the entrance of the midtown tunnel... thats pretty WTF to me...

So 34th to 38th Streets between 1st and Lex in Manhattan is WTF to you too?

I don't really know what a WTF area means, but LICComment, I would not choose to live in that area of Manhattan. I don't know if I'd say it's as far as Lex though. Doesn't it stop between 2nd and 3rd?

5SL is not on top of the midtown tunnel. It is at farther away than Lex is to the tunnel in Manhattan. Even if it was, what's the big deal? There are residential buildings right on top of the tunnel on the Manhattan side. How does this make it a WTF area?

I was looking at this one:

Listing ID: 1234901
Price: $1,395,990.00
CC: $1,474.44
RE Tax: $154.31
Financing: 90%
Listing Type: Condominium
Type: Simplex
Residence Information
Rooms: 4.0
Bedrooms: 3
Bathrooms: 2.0
Approx SQ FT: 1,587

More than $1k psf once the real-estate taxes kick in.

Midtown tunnel comes out between 1st and second. There are a couple of access roads that come out to 2nd...

But, I think the bigger point is comparing Manhattan and NYC. If there is a bunch of inventory in Manhattan under $1k psf - and I showed some examples of new construction closer to $800 - I think LIC is going to have a very hard time holding anywhere near those numbers.

Manhattan has the "well, its Manhattan" factor. And its having issues. The marginal neighborhoods and the outer rings usually get hit the hardest.

You didn't show Manhattan new construction close to $800 psf. You showed one apartment in a FiDi building where the average price for units in the building was $1300 psf.

btw, I just took the address and plugged it into google maps for a reference point... I'm not saying "tunnel entrances are horrible" or anything like that, but I'm pretty familar with the entrance area to that tunnel, and the huge elevated LIE and toll plaza right there. This isn't an LIC overall judgement, just this particular area, which I think will be a little harder to sell because of the tunnel factor.

> You didn't show Manhattan new construction close to $800 psf. You showed one apartment in a FiDi
> building where the average price for units in the building was $1300 psf.

I pointed out an apartment at $821 psf at 20 pine. I've been in the building, its reasonably nice and I think fits for a basic comparison. And its on its way down. They're renting those things out for $2500, so sales prices should follow.

I think the area will have issues, just pointing out that the "LIC value" argument is going to have some trouble when its not that far off from Manhattan pricing.

5SL is nowhere near the tunnel entrance or toll plaza. L Haus and maybe 10-50 Jackson are the closest buildings to the tunnel entrance.

Sorry, I forgot to address the 34th to 38th thing... I wouldn't want to live there either next to the tunnel entrance. But we're not comparing to apartments *there*. The other key factor here is which *side* of the tunnel one is on. Compare Tribeca and Jersey City...

Steve, in my experience, no one factors in taxes when calculating ppsf, especially if they're abated.

"5SL is nowhere near the tunnel entrance or toll plaza. L Haus and maybe 10-50 Jackson are the closest buildings to the tunnel entrance."

I'm sure there are closer, but by the map, it seems to be 3 blocks down and one block over from the plaza, correct?

Or is the building location shown wrong?

http://maps.google.com/maps?hl=en&ie=UTF-8&query=509+48TH+AVENUE,+queens,+ny&q=509+48TH+AVENUE,+queens,+ny&um=1&sa=X&oi=geocode_result&resnum=1&ct=title

> Steve, in my experience, no one factors in taxes when calculating ppsf, especially if they're abated.

In my experience, it is the opposite. Abated is definitely factored in less, but when comparing one building to another, I absolutely see maintenance and deductibility factored into pricing. Hell, the last few appraisals I saw factored it in...

The average psf for active listings at 20 Pine is almost $1300. The CHEAPEST 1-bedroom for rent is listed at $2900, with most listed for much more.

Here's a very nice 2-bedroom, 2 bath Gramercy Park apartment:

http://www.streeteasy.com/nyc/sale/209976-coop-235-east-22nd-street-gramercy-park-new-york

for $812 psf. Nicely reduced, as well:

StreetEasy History

03/27/2008 Listed in StreetEasy by Corcoran at $1,200,000
08/18/2008 Price decreased to $1,075,000
10/09/2008 Price decreased to $975,000

You pick: BEAUTIFUL Long Island City with a view of where you really want to be and not a Duane Reade or Gristedes anywhere, or Gramercy Park.

NB = No-Brainer

bjw, if you don't calculate abated taxes in your psf, you're going to run into a lot of trouble when they unabate. You might not be able to afford the extra $1,000 added to your monthly expenses.

nyc10022, they absolutely are factored into the actual pricing of the apartment. My point was, that when you're talking about price per sq ft, you don't add taxes and maintenance to the numerator. How could you, anyway, since they're monthly costs?

Three blocks up and a block over from the tunnel is not affected at all by the tunnel. You can't see it or hear it from 5SL. That's like saying 39th and Lex is affected by the tunnel. If you were talking about L Haus, I could agree that the tunnel is a factor, but not 5SL.

> The average psf for active listings at 20 Pine is almost $1300. The CHEAPEST 1-bedroom for rent is
> listed at $2900, with most listed for much more.
> (sorry for the multi-posts, I start a response and finish after they are written)

I was talking about the studios, which seem to start in the high 600 psfs. There are a bunch at $2500 or less. Take $2500, go for x20 rent (a pretty generous factor), you get $600k, which is already at $900 psf. I'm assuming that the factors are going to be at work for multiple sizes, but its probably worse for 1 bedrooms, if the glut is still there. Hell, the $2900 example and 800 square feet gets you to $870.

Not saying EVERYTHING is going to be less than. Just noting that for those who look, comparables in Manhattan are already there, and it might just mean the beginning of a fight to the bottom. Its going to be hard to jutify the prices on *either* side of the river.

> you don't add taxes and maintenance to the numerator

Sorry, I didn't get what you are saying. I agree.

bjw from a mathematical perspective you are correct, but from a financial perspective you need to include that number.

OK, before we get to a long discussion, you are both right.

You don't add it to ACTUAL psf, definitely not. But, I think its pretty common to say "PSF is low, but thats because maintenance is high" or whatever, and vice versa.

Nobody has a comment on my beautiful Gramercy Park apartment cheaper than those in the barren wasteland that is Long Island City?

stevejhx, that's correct. You should definitely be aware of what the monthly costs are going to be before you even think about purchasing, but ppsf figures are always a bit rough and shouldn't be factored in the "affordability discussion" anyway. nyc10022, that's true, and that line actually applies to steve's Gramercy Park find above. $1800/mo for a 2/2 isn't insane, but it is much higher than what I'm used to.

That Gramercy coop still costs considerably more than most 2-bedroom condos in LIC, with significantly higher maintenance costs.

At 1200 square feet, not sure about that.. thats pretty large. And a psf of $812, definitely in the LIC higher end range.

As for maintenance... I've seen what happens to new construction maintenance numbers once the abatement ends. $1800 isn't cheap for a 2 bedroom, but its not crazy. That does seem to be a very nice building.

As I said before, of course not apples to apples, but when you can even argue close, that doesn't bode well for the other side of the river.

But those two bedroom condos are in LIC.....

If all that matters is a short commute and Manhattan views you can always move to Jersey *shudder*

Jersey is not a short commute to midtown.
The Gramercy coop also requires a maximum of 60% financing.

That's a gorgeous apartment, and maintenance on co-ops includes property taxes, which are much lower than they are for condominiums, especially prewar.

steve, from the looks of it, it's a pretty nice apartment, though it's admittedly hard to tell without seeing it in person. Co-op maintenance does include property taxes, but I don't agree that they're necessarily lower than in condos. I've seen co-ops that aren't managed as well as others, and maintenance costs are quite high - this can vary quite a bit from building to building. My apartment's about the same size as this one and my monthlies are quite a bit lower.

but in Brooklyn, correct?

I think that we're even having the discussion shows how the dyanmic has changed...

Yes, in WB, but I looked at a LOT of apts in Manhattan, so am pretty confident in what I said above. What do you mean by "that we're even having the discussion shows how the dynamic has changed"?

> What do you mean by "that we're even having the discussion shows how the dynamic has changed"?

That we can even have a discussion about *if* there are comparable prices in Manhattan vs. Brooklyn just shows how much the market has changed...

nyc10022, as far as I know, there have always been "comparable" prices. Brooklyn Heights and Cobble Hill have long been known as wealthy areas, with a host of other neighborhoods seeing wealth come in over the past decade or so. And there are many Manhattan neighborhoods that have had traditionally "low" prices in terms of housing - upper Manhattan, Chinatown, LES, etc. I'm not sure how this shows that the market has changed.

Agreed on BH, not at all on Cobble Hill.. it was for folks who couldn't afford better. Cobble Hill 15 years ago was *very* Italian, *very* working class, and not at all a neighborhood like BH. Only in the past few years has it been mentioned in the same breath as BH (unless one was making a differential). I'd say CH as "wealthy" is a very recent idea...

That being said, we're talking about Long Island City, not Brooklyn Heights.... when neighborhoods developed as "value" inch closer to what they are supposed to be a cheaper alternative to, you have a new paradigm. Also, comparing Chinatown and Upper Manhattan to FiDi? Thats quite a strange jump. If anything, LIC nearing FiDI prices is about the equivalent of upper manhattan prices nearing FiDi prices.

You usually see market inefficiencies as markets work their way to the bottoms...

Actually, that even now that you are noting CH as a neighborhood that should be near Manhattan prices.... to me, thats a clear sign of the crazy paradigm, and that we're going to see some major drops. When a long F train is a similar cost to being on the island of manhattan, look for some crazy drops.

nyc10022, I agree Cobble Hill's wealth came later than the Heights', but I think there were always pockets of CH with great housing stock that did well. My overall point was that pricing in those neighborhoods will not be far off and even exceed (in some cases) pricing in the poorer Manhattan neighborhoods, like East Harlem, Washington Heights, the LES, etc. That's all I was trying to say. Lots of outsiders assume that if a place is in Manhattan, that instantly ups its value, but that's not true given that the best neighborhoods in Brooklyn (and maybe some in Queens, I don't know enough to make that call) do better than the lower-tier areas in Manhattan. I was trying to say that I don't see that phenomenon as a sign that things have changed, as that's been the case for some time now. And I know we were talking about LIC, but you said "Manhattan vs Brooklyn."

I get what you're trying to say... I'm just noting that LIC isn't brooklyn heights and Washington heights isn't FiDi. You're getting to comparisons I haven't made. I'm talking about neighborhoods that have been known as "value" neighborhoods relative to Manhattan "equivalents", and the gap narrowing.

> I was trying to say that I don't see that phenomenon as a sign that things have changed, as that's
> been the case for some time now.

But the examples you've given have been the worst of one vs. the best of another. Thats not the point I'm making. Those aren't the examples I used. I'm talking about neighborhoods that are generally considered inferior substitutes, and the gap closing there. Pointing out W 155th street versus DUMBO doesn't have anything to do with this.

Big point.... I think we're seeing some pretty clear signs of market inefficiency, and to me it just another sign of things to come...

Agreed, LIC is definitely not the Heights. I think I was reading your posts as trying to say that ANY Brooklyn pricing approaching Manhattan pricing was a sign of something being wrong. That's a sentiment I would strongly disagree with. There's no question that the best Manhattan neighborhoods will almost certainly be the priciest neighborhoods in all 5 boroughs. I do think some formerly fringe neighborhoods have passed a "tipping point," so to speak, that will protect them (relatively speaking, here) from turning into what they once were, but there are more than a few that come to mind that probably won't be so lucky if things start to turn ugly.

Yes, definitely some ugly to come. But even neighborhoods that will stay "ok" are going to get smacked... I figure especially the ones that played themselves up as "better value than Manhattan". LIC, Flatbush Ave, those sorts of places. I'm not worried about them falling into the toilet, but I think they expected prices to go so high, they're going to take a pretty bad spanking, even if they neighborhoods improve livability. The economics of those places just don't make sense anymore...

Steve, why do you argue like this?

First you choose by far the most expensive listing on the site.

Second, you mention a 1k psf amount. I don't need to rehash the taxes issue which was ridiculous.

Third, you ignore that the apt you chose has a terrace. A 1000 SQ FOOT TERRACE.

Fourth, you hold this gramercy apt out as a comparison. Forgetting to mention that the LIC apts listed for similar prices are much bigger in general and have an extra bedroom.

Why do you do that?

ccdevi, I'm pretty sure you know the answer to that one.

"Jersey is not a short commute to midtown. " Sure it is, NJ transit goes right into Penn station, the path goes up to 34th street, not to mention the ferrys and express busses.

LIC= Jersey City, Hoboken etc.

"Why do you do that?"

First, terraces are only worth about 1/2 (at best) what indoor space is worth.

Second, I picked the first one apartment I aw.

"LIC apts listed for similar prices are much bigger in general and have an extra bedroom."

Sure they do. And they're in the middle of nowhere. They are overpriced compared to a (for the time being) reasonably priced apartment in Gramercy. You pick what you want - I'd pick 1,200 square feet in Gramercy over 1,800 square feet in the Badlands any time.

And I believe the challenge was to find an apartment in Manhattan just as cheap as LIC on a square-foot basis. So I did.

"First, terraces are only worth about 1/2 (at best) what indoor space is worth."

Sure. But you didn't factor in 500 feet, you factored in zero feet.

"And I believe the challenge was to find an apartment in Manhattan just as cheap as LIC on a square-foot basis. So I did."

But no you didn't, thats the point. I don't necessarily disagree with what you're saying about the area, and I may prefer the Gramercy apt, for whatever reason though you like to bend/break the truth to make your points.

What I found was $812 psf, which is what everyone said that LIC development was going for. Ergo, I did.

You pick your comparisons, I'll pick mine. I'd rather live in a studio in Manhattan than in a palace in Long Island City. My choice.

There are lots of people clueless about LIC here, first and foremost steve, who is clueless about a lot of things. Waterfront property, 5 minutes by subway to Grand Central, and steve calls it the middle of nowhere. He lost all credibility there. Then he makes a misleading comparison of apartments which he knows is stupid. steve has made lots of stupid choices over the years, such as renting for the last ten years, or trying to time the market during the last two months.

Jersey is not an easy commute like LIC. A Path ride to Penn is nowhere near as short or convenient as a 5-minute subway to Grand Central.

Ignoring comment by LICComment.

LICComment - give it up already. LIC has always been the "next" neighborhood for the last 20 years - and will always be there .. unless there is a 40 - 50% price advantage below manhanttan prices, I cant see why anyone would want to live there (oh, I forgot you have that stupid moma afternoon parties on sundays)

LIC is not even in Hoboken's league as a place to live, forget about Manhattan. You can debate the trip in, it depends on where you are going.

LIC blows.

The only reason I could see for living in LIC is if you work in Midtown East & get a place near the 7 train. And even then, last time I checked they don't have any large supermarket over there. Even Harlem has Fairway & Pathmark, not to mention better architecture & restaurants.

In fact LIC's waterfront property is near almost no commercial establishments and a few big lonely blocks to any subway. Have you walked to Powerhouse? I have. Know what's out there? Nothing!

Existing home sales were up.

How's the equity market?

and wtf does this mean?
Ignoring comment by LICComment.

are you that important and attention seeking that you need to tell us who you are ignoring? Like we'll go listen to you, you overleveraged moron

Thanks for more comments from people who don't know anything about LIC. People who say the LIC has always been considered the "next" neighborhood and nothing ever comes of it don't know what they are talking about. Once the city changed LIC's zoning in 2004, the new condo construction began and the changes started. They are now just coming to fruition and the area is becoming more and more popular. If you think there are no supermarkets, restaurants, retail, etc. and that the area is barren, you haven't been there in a long time.

I don't think its barren or dead, I think its come along a decent amount. But, I think its still overpriced, as is much of the city. The "value" proposition really doesn't hold much weight anymore, and the target market - entry level white collar - is exactly what is getting spanked these days.

"What I found was $812 psf, which is what everyone said that LIC development was going for. Ergo, I did."

nah you just made that up. the bulk of the apts are listed at about 650 psf.

"You pick your comparisons, I'll pick mine. I'd rather live in a studio in Manhattan than in a palace in Long Island City. My choice."

Thats fine, just don't lie to make your point. Its that simple.

"stevejhx, check the math on that - they're in the $640-$800 psf range. "

Steve didn't make it up, its what bjw said...

How is it that you can draw comparisons to great Brooklyn neighborhoods and Manhattan when LIC is not in the same league as Hoboken?

LICC - if it took all these years to get the zoning changes in LIC necessary for the condo developments, this is a sign that future development LICC will be likely just as slow. You have argued that when people say LIC's been the next hot neighborhood for 20 years they don't realize it's because of the zoning changes only recently happening. That decades-in-the-making zoning change is exactly what people are criticizing. But I do agree with you that LIC is more convenient than Hoboken or Jersey City. One thing that never gets mentioned in this war about 'hoods across the rivers is that one can walk easily from Wmsbrg or DUMBO or Bklyn Hts to Manhattan. It's possible to walk to 59th & 2nd from LIC, but not 24/7, and it's a long walk from LIC waterfront to the pedestrian walkway on Qnsbro Bridge.

lowery - the whole area was rezoned in late 2004. No more rezonings are needed.

So hopefully rezoning once will make everything happen, but to me it is not a good sign that it took so long to get the zoning to happen.

Those will be worth 40% less than their asking prices by about March 2009. The EuroRush of RE buyer has dried up in Manhattan, meaning lots more manhattan options on the way for those that are qualified. 20% down / 30% for the self employed will be the new reality and that will limit the buyer pool even more. LIC will not and can not hold value against the facts. Williamsburg in in the same boat. The developers will hit a panic switch soon as cash becomes king for future projects and they will want to bail out on this market as soon as they can, which means they will SLASH prices by 30%-40% just to unload (and still make a profit). Give it time then buy LIC if you really want to live there. Now is NOT the time to pull the trigger.

"Steve didn't make it up, its what bjw said..."

That's true, but ccdevi has a point. Steve picked one of the (if not THE) most expensive apts on a ppsf basis and pretty much ignored the large terrace. It's not a terrible comparison, but I don't think it's fair to just look at the ppsf here when there are so many other factors at play.

GoingDown....you are right on. I stole my Astoria/LIC one bedroom new construction Condo in 1992 for $95,000 from an asking price of $230K. 1987 Stock market crashed, 1989 housing tanked. This time around Wall St is having massive job loses, 200,000 by the end of the years and another 165,000 jobs in the private sector by next years. Mortgages will be non existent if you don't put down at least 30% and have a steady job. Also 4-5 million more jobs will be lost in the US economy on 09....Mort Zuckerman says a 10% unemployment........so tell me have they won't be a fire sale? I say some if you have cash you can get something at least 50% off!