True Gotham

This is for REAL. This gentleman is the father of a colleague's customer.  The family lives on the 2000 block of East 13th St. in Brooklyn.  Please keep your eyes open.  Thank you.

Posted By Douglas Heddings | Permalink | 0 Comments

It wasn't long ago that the San Mar Children's Home in Maryland successfully raffled a house to both raise money for charity and get the property off the hands of the owners.  Given the number of inquiries I have received since posting that story, it indeed seems that house raffles are becoming more commonplace in depressed real estate markets across the Unites States.  Now there is another raffle taking place in Maryland and this time the proceeds will benefit our troops through the charity AnySoldier, which is the brainchild of Sgt. Brian Horn.

AnySoldier is a non-profit 501 org and support the troops serving in harm’s way. It started five years ago when Horn parachuted into Northern Iraq with the 173rd Airborne. He stayed on the ground for a year and after 5 months finally got to call home. He asked his parents to send more care packages because his buddies didn’t get any mail from home. This was the beginning of Any Soldier Inc. On Feb 14th they exceeded supporting 1 million troops! Currently, Horn's sister is serving in Iraq. 

An awesome cause indeed and one that I will definitely be supporting.  Here is the press release from AnySoldier regarding their current house raffle:

Any Soldier Inc., a 501(c)3 non-profit charitable organization, is holding a real property house raffle for the support and benefit of our troops. Homeowners Steven and Natalie Skyrm have offered their home to conduct a raffle where the net proceeds will be for the exclusive benefit of Any Soldier Inc. Raffle tickets are $100 each and will be sold online at www.AnySoldierHouseRaffle.com. The home is valued at $835,000 and YOU could be the proud new homeowner.

Any Soldier Inc. currently helps approximately 100,000 service members in all branches of the military, both active duty and reservists, with over 3500 military service contacts. Any Soldier Inc. supports America’s troops in dangerous deployments by facilitating a connection between our citizens and our servicemen and women. The Any Soldier® effort has given hope to most and inspired many of our soldiers knowing that the public will care for them and support them until they return home safely.

AnySoldier Inc. provides information on how anyone can send letters, care packages, and other demonstrations of support, as well as establish networks of soldiers who will be responsible for the delivery of these items. Any Soldier Inc. also aids in the facilitation's and delivery of medical, school, and other humanitarian supplies to the soldiers who donate their time and expertise to the people of the nations they are assigned. Any Soldier’s programs include not only supporting our troops deployed in the war directly but also our wounded soldiers who have arrived home safely. Many of the supported efforts can be seen on the organization’s website.

The house, located in Prince Frederick, Maryland, approximately 30 miles from Washington, D.C., is a single-family custom colonial located on approximately 8 acres with water view of the Patuxent River, approximately 5100 square feet, five bedrooms, 2.5 baths. It is a beautiful farm property with 5 stalls, barn and 6 paddocks.

The drawing will be held at the property on Veteran’s Day 2008, Tuesday, November 11, in honor of our troops. The 2nd through 5th place raffle winners will receive cash prizes. You can purchase tickets and see rules and regulations (including those relating to the winner’s tax obligations) on the website.

Posted By Douglas Heddings | Permalink | 2 Comments

When I entered the Manhattan real estate market 16 years ago this week, I was greatly attracted to the personal and emotional elements of the residential real estate transaction.  And over the past 16 years, I have seen the market ebb and flow with emotion playing different roles in the sales transaction.  Of course, sellers are often emotional about "letting go" of their current home as it may be the first home that they owned, the place where they met their current spouse/partner, or the roof under which they have raised their family and built so many memories (both good and bad).  In the past decade, buyers were also subject to the effects of emotional engagement as they searched for a home and they still are but much less so.

It is my experience lately that more and more buyers are thinking with their wallets instead of their hearts.  The current mortgage market, media reports of housing declines across the country, and the desire to avoid buying at what some think may be the peak of a market (we're past the peak in my opinion) are all important factors that buyers are considering when proceeding with the purchase of their future home.  Buyers want perceived value more today than they have in the past 10 years which is often frustrating for sellers who receive low ball offers on the properties to which they are so emotionally attached.  The perceptions of buyers and sellers are not only very different but also have absolutely nothing to do with one another.

What this all means of course is that in today's real estate market, a seller, more than ever, must try to remove their emotions from the sales process.  The buyers have already done so in most cases and are less frequently competing with other buyers for a home.  I coach my current sellers to do the following when marketing their homes and fielding offers:

• Price according to recently sold properties and those already in contract:  Don't put too much weight in the prices of currently available homes as they aren't as relevant to your home's value unless you're considering aggressive pricing.
• Consider aggressive pricing:  If there is a similar home on the market in your building, perhaps on a lower floor, consider pricing your home below that home's asking price to increase perceived value.
• Don't take low offers personally:  There are a multitude of buyers out there with a "sky is falling" mentality (it's not) who are making extraordinarily low offers as much as 25-30% below the asking price.  They are NOT trying to insult the seller but rather subscribe to a specific set of beliefs about market direction that greatly influences their bidding strategy. by the way, in my 16 years, with the exception of foreclosures, I have yet to see a seller agree with a buyer's assessment of a property's value.
• Consider what offers are saying about the market:  Again, don't take low offers personally but also don't ignore them particularly if you receive multiple low offers.
• Be Patient:  Unless you absolutely must sell in a specific time frame, understand that it may very well take more time than you had hoped to sell your home.  It will likely sell but manage your expectations by frequently communicating with your agent.

Perception of value is obviously subjective.  That said, if a seller is able to remove emotion from the marketing and negotiation process, they are more likely to appeal to a buyer's desire for value than the seller who hangs onto why their home is so special to them.  Everyone can respect an appreciate a seller's attachment to their home but in today's market, buyers just want you to "show them the value."

And a message to buyers:  it's highly unlikely that you are going to "steal" a home from someone in today's Manhattan real estate market.  Offers of 25-30% below ask, particularly when a home is fairly priced, are generally a waste of everyone's time.

Posted By Douglas Heddings | Permalink | 0 Comments

In today's tighter lending environment, I'm consistently amazed at the number of buyers showing up to see my exclusive properties who have yet to speak with a lending institution or mortgage broker regarding their mortgage needs.  I'm equally amazed at how many of these same buyers are completely unaware of how lending standards have changed as well as what options are still available to them in the current mortgage market.  Here are just a few ways in which lending standards have changed:

• LTV (loan to value)/ Down payment Amounts:  Although many are still qualified for 80 and even 90% financing, some who qualified for these products last year would be expected to put more money down enabling only 70% or even 60% financing.
• DTI (debt to income ratio): This is the ratio of your debt payments to your pre-tax income.  Prior to the "credit crisis," there were stories of people with DTI as high as 87%...yes that's right...87% of their income was going to service debt.  That particular person had significant liquid assets but the DTI was extremely high.  Now many banks (not all mind you, which is all the more reason to do your homework) subscribe to the 33/38 rule.  Housing payments can't be more than 33% of your pre-tax income and overall debt can't be greater than 38% of pre-tax income.  Again, many mortgage professionals still have access to loans with much higher DTI's (ex. someone in our office had a client qualify with 60% DTI last week).
• Reserve Requirements:  Every bank has different requirements for liquid assets post closing but almost ALL have increased those requirements. For example, some banks may require 6, 12, or 24 months of housing debt payments in the bank post closing while others may require as much as 25% of the loan amount in liquid assets.  

These are just some examples of how lending standards have become more strict in the past year but this is by no means an illustration of the current environment for all buyers.  Financing is indeed possible and the following may be surprising news to some:

• Savings Banks and Portfolio Lenders (loans to $3M):  Unlike the major national banking institutions, these lenders aren't dependent on a secondary mortgage market (they aren't reselling your loan). Because of this, many of these banks are offering more competitive rates.  So don't simply rely on your current banking relationship...shop around and consider a mortgage specialist to help you do so.
• Jumbo Conforming Loans (loans between $417K and $729,050) and Conforming Loans (loans less than or equal to $417,000):  Many buyers still qualify for loans of up to 90% in these 2 categories despite income and credit scores.

If you require a mortgage in order to purchase a home, follow that old Boy Scout motto and BE PREPARED:

1. Before you go out looking at homes and get your heart set on that beauty you may visit, get a referral for an exceptional mortgage broker who has a knowledge of what is truly available in today's lending environment.. 
2. If it's too late and you have already visited the home of your dreams, don't settle for that single rate quote from your bank. 
3. Strongly consider a mortgage broker/banker who can run review your financial condition including credit history and provide you with ultra competitive rate quotes from multiple local savings banks and portfolio lenders. 

You may indeed be pleasantly surprised by the mortgage products available to you in today's market place.

Posted By Douglas Heddings | Permalink | 0 Comments

Here's a breaking story that could dramatically change the face of Manhattan real estate and your  very own quiet little enclave.  From Landmark West via The Historic Districts Council blog comes this breaking news:

Today, the NYC Board of Standards and Appeals (BSA) gave a green light to Congregation Shearith Israel (CSI)-and to all nonprofit and religious institutions seeking to turn the air above their sites into luxury condo revenue streams, even where laws designed to protect neighborhood character and property values explicitly restrict it. CSI’s planned development project is located in the R8B-zoned, low-scale, brownstone mid block of West 70th Street, adjacent to the Individual Landmark Spanish & Portuguese Synagogue, in the Upper West Side/Central Park West Historic District.

With its unanimous approval of 7 zoning height and setback variances, the BSA bowed to CSI’s argument that denial of its application to construct 5 floors of luxury condominiums on top of a new 4-story community house would interfere with its charitable mission and impose an economic hardship on this congregation (one of the wealthiest in the city, counting among its members Jack Rudin, the developer for the St. Vincent’s Hospital project in Greenwich Village). In other words, CSI says, “Back off, City, we’re a nonprofit and nonprofits can do whatever they want.” The (mayor-appointed) BSA rolled over, despite CSI’s repeated failure over many months of public hearings to demonstrate hardship or any link between its mission and the condos (to be sold on the open market for millions).

Contextual zoning is a ceiling developers have been pushing against for decades. And now, 5 floors or 50 floors, the sky’s the limit for nonprofits with properties in traditional, low-rise communities in Brooklyn, Queens, the Bronx, Staten Island and Manhattan.

We know all this commotion over a 9-story, 114-foot-tall building sounds alarmist (even though it is double the size of the 4- and 5-story brownstones that define 95% of the historic West 70th Street midblock). But, even as we speak, the BSA is also poised to approve Mount Sinai Medical Center’s proposed development including a 542-foot-tall (the equivalent of 54 stories) residential tower on the eastern edge of Central Park. Meanwhile, planners have identified 10 potential development “soft sites” along Central Park West, many occupied by low-rise institutions such as the New-York Historical Society (which, until recently, had planned a 280-foot-tall tower that would have required special zoning exemptions).

It doesn’t take a microscope to spot this trend, which could have even greater ramifications in the other boroughs. With today’s approval, the BSA has opened the door to luxury condos towering over nonprofits in every previously protected neighborhood in the city. And their decision is final. Except for court. Stay tuned…

Imagine the ramifications of this?  The Catholic church alone could so dramatically change the skyline and inventory of Manhattan real estate.  It will be very interesting to see how this plays out!

Posted By Douglas Heddings | Permalink | 0 Comments

I was born and raised in Baltimore and moved to Manhattan in 1989.  Although I very much identify myself as a New Yorker and can't imagine living anywhere else, it is very hard not to jump on the Baltimore bandwagon now that Michael Phelps has won 8 Olympic gold medals!

An astounding and inspirational achievment by a native of Baltimore!  Now Phelps is buying a sexy condo (check out what you get for $1.69M) in Fells Point (via ZillowBlog) and rumors are swirling that he may even be buying his old training ground, The North Baltimore Aquatic Club in an effort to create a state of the art Olympic training facility.  Now that would really put Baltimore back on the map.  It's a good thing, because it's not likely the Orioles or the Ravens (for the record, I've been a Steelers fan since the age of 4) were going to have anything to do with Baltimore's resurgent popularity.

Posted By Douglas Heddings | Permalink | 0 Comments

My phones are beginning to ring with more frequency and although this is merely anecdotal, I am seeing and hearing evidence that activity may pick up considerably this fall.  I and many of my colleagues are receiving inquiries from possible sellers who are considering a sale in the coming months.  The phones are also busier with inquisitive buyers, patient indeed, but more numerous.  Both sides seem to be willing to wait until summer's end to see in what direction the Manhattan real estate market will move. 

Here's my two cents: 

I think we are going to see a modest increase in inventory over the coming months but still not enough to greatly effect market conditions.  That said, tight lending standards will continue to thin the pool of qualified buyers and a relatively stable, give and take market will continue into 2009.  As I stated in yesterday's post, patience is indeed an important virtue for sellers and buyers alike.  Properly priced homes with some outstanding quality will continue to be the first to be snapped up while others will take considerably more marketing effort and time to sell.  I also suspect that prices may come down slightly but for the record, I have been saying that for 3 years...eventually I will be right. 

Lastly, I think this more challenging market environment will prove too much for many of the more novice real estate agents as sellers demand experience and/or marketing sophistication.  This will likely result in a thinning of the ranks among real estate professionals. 

Now I could be wrong of course on absolutely all counts but I thought I would go "half way" out on a limb for a change and make some "vague" predictions.  Let's see what happens.

Posted By Douglas Heddings | Permalink | 2 Comments

If you're one of the few sellers out there who has such a uniquely special (is that redundant?) property to bring to market, then this post isn't for you because "special" properties that are priced right continue to be snapped up as quickly as they hit the market.  But for the rest of you, patience is perhaps the most important quality that you must exhibit in today's bizarre Manhattan real estate marketplace.  There are several factors that have changed the pace of transactions today:

• Mortgage Market has Thinned Buying Pool-Many who believe that they are perfectly well qualified for a mortgage are in for a rude awakening.  Tightened lending standards are effecting many who would have easily afforded a home this time last year.  We recently had a established and respected reconstructive plastic surgeon denied for a mortgage on a sub-$1M property based on his student loan debt and credit score in the mid 600's...last year he could have gotten 90% financing...NOT NOW.
• Market Analysis is More Sophisticated- Each micro-market behaves differently and I have said it a multitude of times before but now more than ever do I see very distinct differences in the behavior of Manhattan's micro-markets.  Apartment size, style, and geographical location serve to divide Manhattan real estate into markets that shift and act independently of one another.  When pricing, don't compare your Upper West Side Classic 7 on a price per sf basis to post war 3BR apartments...they are different markets.
• Your Market Determines Movement in Inventory-The owner of a 4BR condo with spectacular views on the Upper West Side is much more in the cat-bird seat than the owner of the cookie cutter 1BR on the Upper East Side.  Overall inventory numbers are meaningless...if you own a Prewar 2BR in a specific area, ask your agent to track inventory specifically with those parameters.
• Buyers are Both Anxious and Cautious-No one wants to think that they are buying at the absolute peak of the market and at the same time they are reading daily media reports of how awful the "housing market" is performing.  The mixed messages that buyers are receiving are confusing and make the decision of whether or not to buy a home much more challenging than in the recent past.  Sellers should expect buyers with cold feet these days and deals to dissipate during the process before finding the 'right" buyer.
• Sellers are Nervous-Trust your real estate agent regarding price.  Many sellers are eager to reduce prices these days because they haven't yet received a bid.  When I started in this business in 1992, properties were often on the market for 2 years or more (we're not there) and if price reductions were the only answer, we would have been giving places away.  That said, often times, a price adjustment is necessary.  if so, make it count.  Reduce the price significantly enough (10% or more if possible) to resuscitate the property.

Overall, the Manhattan real estate market has changed drastically from the days of multiple bids on every property that hit the market.  That said, those properties with incredible views, layouts, outdoor space or other unique features are still garnering a plethora of interest.  The rest will also sell...it may just take longer than you had planned.

Posted By Douglas Heddings | Permalink | 2 Comments

For those who can't make it to tonight's free panel discussion on The Future of Local Video, you can watch via a Live Feed right here tonight at 6:45PM:

If the above feed isn't working, click here

Posted By Douglas Heddings | Permalink | 2 Comments