With all of the talk still going on regarding the bill to force Co-op Boards to disclose their reasons for rejecting applicants, I couldn’t resist passing along this question posed by The Anti-Discrimination Center via Curbed:
REJECTIONVILLE—And now, a note on the eternal struggle for co-op board transparency: "The Anti-Discrimination Center has been working to pass a law, ‘Intro 119,’ that would require co-ops to provide their reasons for rejection when they turn down an applicant. Over 40 civil rights and allied organizations and a majority of the City Council already support the bill, yet those who want to maintain a system of privilege and exclusion are fighting desperately against it. They have thus far succeeded in having City Council Speaker Chris Quinn keep the bill bottled up without a hearing. In order to underline the importance of this issue, we need to hear from people who have been turned down by co-ops. Please email us at [email protected]."
Check out the comment string at Curbed. As we already know, many fear lawsuits but "thou doth protest too much!" If Co-op Boards are rejecting people for legitimate reasons like financial insolvency and not because they are disabled or homosexual, then I’m not sure from where this fear comes. Certainly Board members would have to have Directors and Officers insurance but if they behave with integrity, they should be somewhat immune to lawsuits. Of course there may be a frivolous lawsuit here or there but I personally don’t believe it would reach epidemic proportions.
A regular reader of mine, newbie, suggested regular "spot" audits of Boards to insure that they are keeping books and behaving appropriately regarding applicant review. Not a bad idea at all IMHO.
In the meantime, we continue to live with the Co-op structure as it is and for the most part, "it ain’t all that bad!" That said, a colleague of mine just had a buyer of his turned down in a Co-op who has a reputation for discriminating against the disabled (they lost a law suit about 11 years ago to someone who proved that the building feared that they would cost them money in the form of modifying the building to suit the applicant.). My colleague’s applicant was collecting ample tax-free disability income and after an all cash purchase had more than the purchase price of the apartment in his regular checking account (I don’t know why?). There is absolutely NO WAY that this Co-op Board could have come up with any reason to reject this buyer other than his disability and that my friends is precisely why I support this bill.
Fellow blogger and respected voice of real estate, Jonathan Miller is blogging today at Matrix about something that he and I share as a pet peeve: There Is No National Housing Market.
The use of national housing statistics has been a key source of confusion for consumers, real estate brokers, lenders, media, financial markets and government agencies among others. The statistics are often applied to local markets and properties. The reliance on these numbers for ground level use has been a pet peeve of mine for many years.
And mine as well. What I find interesting is that now that markets across the country are experiencing some dramatic drops in pricing and activity, the real estate community as a whole is embracing the reality that real estate is local. This concept didn’t seem to be a focus for the NAR or economists while these same markets exploded over the past decade. The National Housing Market was robust and booming. The National Housing Market was defying all odds. The National Housing Market was a great place to invest. Now that these statements aren’t true in many markets across the country, we finally appear to accept and acknowledge that real estate is local? Referring to RadarLogic’s own report (which for the record Jonathan has always acknowledged that real estate markets are local), Miller quotes:
The report effort was based on the premise that there is no national housing market; rather, each of the MSAs, while having some economic influences in common like mortgage rates, is influenced primarily by local conditions.
Jonathan goes on to point out that other major real estate organizations are finally acknowledging that specific markets across the country are behaving differently. The Office Of Housing Enterprise Oversight [OFHEO], the NAR, and the National Association of Home Builders have all recently commented on the housing market from a different and more accurate perspective. Hard to not say that this shift in perspective seems incredibly self-serving. That said, I just hope that when markets across the country begin their rebound that these organizations don’t go back to reporting on the National Housing Market because now we all agree that ‘it" doesn’t exist.
If you’re a seller with a property currently on the market or you’re thinking of selling anytime soon, it’s imperative that you listen to the market and pay close attention to current buyer psychology.
This morning I received an email from one of my Wall Street buying couples with a subject line that read, "hopefully this will help us negotiate!" The article from this morning’s Wall Street Journal titled They’ll Take Manhattan — For Less-No Longer Immune, Sales and Prices Slip; Waiting for Bonus Time is just the type of press that is fueling buyer anxiety and adding to a market that is already seeing multiple stalemates between unrealistic sellers and overly pessimistic buyers.
This is just the type of press that most sellers will choose to ignore and most buyers will over analyze in their own favor. But even this article has some contradictions (see the bold points) For example, here are some comments/quotes taking directly from this piece:
Pro Buyer
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Fewer apartments are being sold — 858 went into contract in September, a 9.9% drop from a year ago and the lowest total in two years, according to brokerage Corcoran Group
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inventory of unsold apartments is increasing.
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Prices are also leveling off. The median price of a Manhattan apartment fell 3.4% in the third quarter from the previous one, according to the research firm Radar Logic.
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The firm says properties are sitting on the market longer, too, an average of 123 days, up from 94 days at the peak of the market in 2005.
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Developers used to seeing yet-to-be-built apartments get snapped up sight-unseen are increasingly offering incentives, from help with closing costs to museum memberships, to jump-start sales.
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"Buyers are more hesitant," says Hall Willkie, president of brokerage Brown Harris Stevens.
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Trouble in the financial sector will hurt home sales, says Nouriel Roubini.
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Christopher Mayer, a Columbia University professor and director of the school’s Paul Milstein Center for Real Estate, says the idea that Manhattan will continue to boom amid a nationwide housing bust is "wishful thinking."
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Some buyers are already finding bargains.
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"We’re getting this apartment for probably 2004 pricing"
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…some New York brokers and potential sellers are growing nervous. So far this quarter, 1,473 sales have been recorded in Manhattan compared with 4,337 for the entire quarter last year, according to Gregory Heym, chief economist for Terra Holdings, which owns brokerages Brown Harris Stevens and Halstead Property. Many sales negotiated earlier in the quarter haven’t closed yet, but with December usually a slow month, Mr. Heym says there will almost certainly be fewer sales this quarter than last.
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In October, the Office of Management and Budget cut its projected revenue from property transfers by $82 million, a 5.9% drop from its original forecast. (The figure includes revenue from both commercial and residential sales.)
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Supply, however, is increasing.
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New developments have begun to offer incentives to attract buyers .
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The number of price cuts, at all levels of the market, is also growing.
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The average sales price of a co-op fell 2.8% to $1.12 million in third quarter of 2007, compared with the second quarter, according to Radar Logic.
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…but prices downtown have fallen 18%, to $1.1 million, according to Terra Holdings.
Pro Seller
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In recent months, the continuing strength of its (Manhattan) real-estate market has drawn even more attention, and led many local real-estate professionals to contend that Manhattan is immune to the forces that have battered much of the rest of the country.
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Prices remain near record levels.
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The median price of a Manhattan apartment is $864,397, up 2.3% from a year ago.
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The weak dollar has led to increased interest from abroad.
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Some brokers say they haven’t seen a drop-off at all. Pamela Liebman, chief executive of Corcoran Group, says the brokerage is on pace for a record year and says that after a September slowdown, October showed an increase in sales. Jacqueline Urgo, president of the national real-estate firm The Marketing Directors, says sales in most of the company’s Manhattan properties improved in mid-September after a brief lull. Even many brokers who have seen a falloff say the shift says less about the current market than the frenzied one that preceded it. "We’re just seeing the market return to normal," says John Burger, a broker at Brown Harris Stevens.
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So far this quarter, the average price on the Upper East Side has risen 11% to $1.7 million
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…listed their pied-à-terre on East 28th Street for $495,000 in May. They quickly accepted an offer for $480,000, but their co-op board rejected the buyer. (It’s still on the market for $450,000)
From the looks of all of this data it appears that the market is tipping in favor of buyers. I’m still not seeing that entirely…yet but I am seeing a much more patient buyer which is bringing some anxiety to some sellers. Yes I said SELLER ANXIETY…touche to all of you buyers. This I haven’t seen in a decade and I’m going on the record right now and saying again that sellers would be wise to listen to their respective markets and not be so quick to turn down reasonable offers or they may indeed find themselves getting bitten in the asking price!
I’m very excited to be speaking again at this year’s Inman Real Estate Connect conference in January. Here’s what you have to look forward to straight from the Inman Connect web site:
What is Real Estate Connect?
Real Estate Connect NYC is where the leaders in real estate and mortgage come together with top technology executives to promote change and innovation within the industry. Big name speakers, topic-driven panels and practical workshops combine to provide attendees with the tools and techniques they need to compete in a rapidly changing landscape.
Who Should Attend?
January’s event will draw upwards of 1,200 real estate agents, top brokers, mortgage professionals, technology company CEOs, directors and managers, entrepreneurs, press, analysts and investors from throughout the U.S. and around the globe.
Topics to be Addressed
Join the brightest minds in the industry as they discuss: real estate market conditions, market forecasts, interactive marketing, social media, Web 2.0, MLS, mapping, lead generation, blogging, user generated content, search engine marketing and search engine optimization, online video, paperless technology and more.
I will be participating on the following Bloggers Connect panel:
Wednesday, January 9, 9:45 a.m. – 10:30 a.m.
Beyond the Written Word: Videoblogging and Podcasting
Join an expert-driven panel discussion on how to infuse color into your blog with videos and podcasting. Panelists will discuss easy methods for using new mediums to connect with your audience.
Moderator: Jeff Turner, President, RealEstateShows.com
Panelists:
P. Morgan Brown, Chief Operating Officer, New Day Trust Mortgage
Douglas Heddings, Senior Vice President, Prudential Douglas Elliman (that’s me)
Dave Nelson, Founder & CEO, TalkShoe
Mike Price, President, ML Broadcast
So come check it out and….
Hope to see you there!
If you’re a reader of TrueGotham and not also reading UrbanDigs, you are missing some incredibly valuable insight and information from my friend and fellow blogger Noah Rosenblatt.
Recently, Noah unveiled his new site with a feature that is only becoming more useful and insightful with each passing day. The Manhattan Housing Data Charts (powered by StreetEasy) provide real time data of Manhattan housing inventory including new listings, contracts signed and price changes.
I am asked the question of how inventory is trending almost everyday and now the source for the answer is at my fingertips at UrbanDigs. Bravo to Noah for the beautiful job he has done in upgrading his site, providing this valuable data and making the market more transparent for the consumer.
This week’s episode of OpenHouseNYC focuses on an "amenity" that New Yorkers never get enough of: CLOSET SPACE!
In this edition of Floorplan, George Oliphant confronts a perpetual problem of city living: no closet space! First George meets with Dorren Tuman, the closet lady to learn about custom solutions for your closet. Within 3 weeks, Doreen can examine your wardrobe, measure the spaces and install things like Double/Triple hanging to maximize the space in your closet.
Later, George checks in with Matt Laken and his mom Stacey to examine their closets and see how it works. Both son and mom have well-organized unique spaces at a cost of around $700-800. Even the young Matt doesn’t mind keeping his closet clean with the help of his organizational cabinetry.
Then George checks out the closet of the future for high-end wardrobes, Garde Robe. Garde Robe www.garderobeonline.com is a cyber-closet that will store garments in an efficient and safe manner for beginning at $350 month. You can catalog your items and retrieve them whenever you need them with sheer convenience.
Finally, if you’re still not sure what kind of closet suits your needs check out the California Closets showroom at 26 Varick Street or on the web at
www.californiaclosets.com.
So whether you want to build a new closet in your home or find a high-tech storage facility, this edition of Floorplan is for you.
The topic of closets always takes me down memory lane to the first apartment my wife and I shared prior to getting married. It was a charming 500sf 1BR in a brownstone with only 2 small closets. My wife (then girlfriend) got the closet in the bedroom and we shared the utility closet in the kitchen. Try selling apartments when your suits smell like bacon!
I just returned this evening from an incredibly relaxing Thanksgiving in St. Thomas and couldn’t imagine anything that could put an exclamation point on such a great trip than this news:
THE NYPD HAS ARRESTED THE OPEN HOUSE CRIME DUO!
David Li from the New York Post just called to ask me for details and I know nothing as I was away. I will be certain to share more details as they become available on Monday but for now just follow the link above to The Post article.
Thanks to everyone across the internet and mainstream media who ran with this story, posted the photos of these culprits, and ultimately forced the investigation that led to their arrests!
A special thanks to Lock and Joey from Curbed, Noah from Urban Digs, and Peter from Comitini.com for their quick posts on this subject.
Monday Morning UPDATE: Surprisingly the Daily News refers to one of the women as being a "sexy brunette"…that was the one we thought was a guy!
Anyway, great news that they have been caught and charged but everyone should use this as an opportunity to be more diligent about open house security.
Monday Evening UPDATE: The jewelry that the duo took from my sellers has been returned! Apparently the 2 have been waiting downtown at the court house for their attorney to appear for their arraignment.
I’m off to St. Thomas for my first ever Thanksgiving outside of the United States. I’m incredibly excited about this opportunity and wish all of my friends, family, clients (past and present) a very healthy and Happy Thanksgiving!
I hope that all of you can find a multitude of reasons to give thanks.
I am choosing to stay away from the computer and the BBerry while I’m away so comments will be posted and responded to when I return on Monday.
Thanks to all of you who have made TrueGotham a success!
One of the most frquently asked questions I field is "What’s happening on that lot at the corner of 72nd Street and Broadway?"
Thanks to Curbed, here’s a very accurate and complete answer direct from RKF’s website.
Check out the rendering also via Curbed and RKF. Looks quite nice and befitting of the space.
There is a reason that the majority of my business has always been representing sellers. Just as the used car salesman reputation of real estate agents doesn’t come from space, so too is true of the "buyers are liars" mantra. Before you go getting all up in arms about what I just said, please hear me out. It is my belief that most of my colleagues are not just better than used car salesman (why they get such a bad rap would be an interesting discussion) but their are exponentially better and truly bring value to the transactions in which they are involved. It’s the minority of agents who are uninformed, dishonest, and generally lack integrity that tarnish the industry reputation. Similarly, most buyers seem to appreciate the value that an excellent agent brings to the mix but unfortunately they seem to have a difficult time finding those excellent agents or they don’t realize it when they have found them. The inability to find an agent that one "clicks with" and trusts is the foundation of the "buyer are liars" mantra that many in my industry live by. This circle of distrust snowballs to a point where, regardless of the competence of the agent, neither the buyer nor the agent trusts what the other is telling them during the course of a transaction. Some examples:
- A MANHATTAN buyer and agent work together for 6 months or more (often times for 1-2 years) all the while the buyer assures the diligent agent that they are the only person that the buyer is working with. 6 months or so into the transaction, the buyer either "vanishes" or simply calls and says, "I found an apartment in Brooklyn through such and such agent. Thanks for all of your help." The agent was not only unaware of a Brooklyn search but more surprised that the buyer was working with someone else. 6 months of hard work with absolutely zero payout…how many other professions would settle for that?
- Another Manhattan buyer tells the agent how much they value his/her participation in their search because of the agent’s experience and knowledge of the marketplace only to cut the agent out of the transaction thinking that they can do better by directly negotiating with the seller’s agent.
- A third Manhattan buyer is working with his/her agent for more than a year and finally locates a perfect property for his buyer. The buyer convinces the agent to let him speak directly to the seller. The buyer’s agent asks the seller’s agent if this is possible and they all agree only to have the buyer attempt to cut both agents out of the transaction when he speaks with the seller.
- And the most frequent offense by buyers is the statement "we’re not working with a broker" which almost always implies that they think they can strike a better deal because no one is being paid on their side of the transaction. Trust me…more often than not, the seller is still paying a full commission so you aren’t doing any better without an agent. In fact, I would argue that a transaction with two educated, knowledgeable, and professional agents with integrity will be more fairly negotiated to a better end than a transaction with only one agent or none. Don’t forget where fiduciary responsibility lies and also keep in mind that sometimes that fiduciary responsibility is to the agent’s own pocket.
I could go on. These aren’t scenarios that I made up. They are incidents in which I was one of the players. In addition to these examples of less than scrupulous buyers, the "buyers are liars" mantra also comes from the fact that although many buyers think they know exactly what they want, the buying process is just that, a process. In my 16 years, I can’t tell you how many "prewar" buyers bought new developments, how many Downtown buyers bought Uptown, how many "view" buyers chose more space, and how many "doorman" buyers bought townhouses.
So you see, the distrust in this industry goes both ways. The only way that we can change that is by raising our level of service to the consumer and proving to the public that we can be trusted. Only then will they disarm and allow us to truly help them with the process of finding a home. Until then, many continue to play the game.
