Showing posts with label coops. Show all posts
Showing posts with label coops. Show all posts

Jul 1, 2014

Manhattan Market Report | Second Quarter 2014

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 Manhattan Market Report | Second Quarter 2014
·     
      Overall, the market-wide cost for Manhattan’s homes increased 20% in average sale price, 6% in median sale price, and 15% in average price per square foot versus Second Quarter 2013. The average price per square foot reached $1,286 this quarter, a new peak. 



Highlights of Manhattan Second Quarter 2014 Market Report:

·         Inventory Starting to Turn Around.  Although the number of properties listed for sale remains low (52% below the peak in Q1 2009), inventory rose for the second quarter in a row.

·         Limited Supply Buoys Prices.  inventory was up, but its overall continued depressed level maintained competitive conditions among those in the market to purchase.

·         Slower Activity in Bread-and-Butter Sales.  In Manhattan, one- and two-bedroom units are the primary drivers of residential sales activity, but they are occurring with decreasing frequency.  (see Sales by Price Category, p. 6.)  

·         Luxury Sales Grow Disproportionate.  Activity at the high end continued to be robust, and grew as an overall percentage of the market.  Properties above $3M now account for 12% of sales (up 3% from a year ago), and 26% of available inventory (up 4%).

·         Price Per Square Foot Sets New Record.  The focus on high-end sales drove the average price per square foot for Manhattan real estate up to $1,286.


The Second Quarter described signs of buyer fatigue and caution, particularly amongst prospective buyers of small units.  With prices at their peak, there is less incentive to become a first-time buyer, or to trade up from a starter home. 

Sellers act now and price it right. 

Each market segment and neighborhood has it's own nuances. If you're thinking about buying or selling a home, or would like to discuss the market or this report please contact me.
 

For the complete Corcoran Manhattan Second Quarter Report including neighborhood reports.














May 13, 2014

How Much Apartment Can You Afford?

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I'm often contacted by buyers that want me to show them apartments. Often these buyers do not know how much apartment they can afford. They require financing but have not been in contact with a lender.

Understanding your financing needs before you search for a new home will help you move ahead quickly and confidently when you find the right home. Before you start looking for an apartment in Manhattan you should be pre-approved and qualified by a lender

I originally posted How much Apartment can you afford? in 2009 while the Manhattan real estate market was declining. 

Currently there is limited inventory in Manhattan with pent up demand from buyers. This market calls for swift and aggressive action. Buyers must be ready, willing, able, prepared and qualified.

Understanding The Related Costs of Apartment Buying  

You'll need to think about more than a mortgage payment to determine if you can afford an apartment in Manhattan. To assure you are purchasing a home within the confines of your budget, you must consider down payment requirements, closing costs, taxes, carrying charges, and yearly maintenance requirements as well. 

How much can you afford? 

First consult with a mortgage broker or banker to determine how much of a mortgage you qualify for. Calculate the estimated mortgage payment plus monthly maintenance (coop), common charges and real estate taxes (condo). 

Several formulas exist to help determine how much a lender will allow a consumer to borrow. One of the more accurate formulas is a front- and back-end ratio. It states that the buyer can afford as much as 28 percent of his or her gross-monthly income toward the monthly mortgage payment, assuming that the consumer's other debt payments (credit cards, car loans, student loans, etc...) are less than or equal to 8 percent of his or her gross-monthly income. The maximum back-end is typically 36%.

Most NYC coops have stricter financial requirements than most lenders. Most coops use a 25% -30% debt to income ratio formula. Many coops will only allow a maximum of 75% financing although some will allow 80%. Coops may also require liquid assets available after the closing to cover 2 years worth of maintenance or 1 year of mortgage and maintenance. Every building varies and uses their own formula. 

While condos will allow 90% financing many sellers today will not risk accepting an offer requiring a  financing contingency with such a small down payment. When a bank agrees to lend 80% (or 90%) loan-to-value, they are indicating their willingness to finance up to 80% of the purchase price.  

If the appraised value happens to come in at $500,000 instead of the contracted purchase price of $600,000, the lender will ultimately finance 80% of the lower of the two—in this case the appraised value of $500,000.  Unfortunately, this means the buyer may have to scramble to find more cash to put down. 

A minimum 20% -25% down payment may be required. Understanding your financing needs before you search for a new home will help you move ahead quickly and confidently when you find the right home.


Apr 14, 2014

East Harlem | Manhattan Neighborhood

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Metro North Railroad Station at 125th Street & Park Avenue

 
'There is a rose in Spanish Harlem
A red rose up in Spanish Harlem
It is a special one, it's never seen the sun
It only comes out when the moon is on the run
And all the stars are gleaming
It's growing in the street right up through the concrete
But soft and sweet and dreamin'

Ben E King 
"Spanish Harlem" 





Manhattan Neighborhood | East Harlem

El Barrio (Spanish Harlem) SpaHa (East/Spanish Harlem) community stretches from First Avenue to Fifth Avenue and from East 96th Street to East 125th Street.

Rich in history and residential charm, the diverse East Harlem neighborhood offers those in search of a new apartment or townhouse plenty to peruse. Housing stock runs the gamut from row houses to studios, from one-and two-bedroom co-ops to renovated tenements.

A big draw in East Harlem is space — apartments often come with a dining room, an outdoor garden, or even parking. Large rental complexes like Hampton Court (complete with gyms, garden decks and retail shopping) are now being joined in East Harlem by luxury condos offering views of the East River, the George Washington and RFK (Triborough) Bridges.

Lexington Hill Condominium (103/104th Streets)
East Harlem’s cornucopia of food, culture and lively street life reflects its history. From the exclusive Rao’s Restaurant, founded in 1896, and Patsy’s Pizzeria, established in 1933 in part of Old Little Italy, to modern-day bodegas and botanicas, shopping and dining in this neighborhood continue to evolve even as the Uptown apartments do.

On the artsy side of East Harlem, provocative murals by celebrated artist James De La Vega — some commissioned, some not — dot the neighborhood and the living legacy of Salsa greats continues at venues such as Creole, a jazz/supper club, and Orbit, a bar/restaurant that hosts open mic nights in its jazz and cabaret schedule.


East Harlem residents enjoy the East River Plaza on 116th Street off the FDR Drive that opened in ’09. If you want to stock your home with everything, big companies that will be offering their wares for sale in East Harlem include Target, Marshall’s, Best Buy and Manhattan’s first Costco. Other neighborhood attractions include the Museum of the City of New York, El Barrio Museum, Central Park East and North Meadows.

Easy access to get out-of-town. There's a Metro-North Railroad Station at 125th Street with a 4-5-6 Lexington Avenue subway stop and easy access to the FDR Drive and the west side via cross town bus on 125th Street. Easy access to La Guardia airport from 125th Street airport bus.

There currently are approximately 40 active apartments for sale in East Harlem. Ranging from $139,000 for a 2 bedroom, 1 bath, 5th floor walk-up to $2,980,000 for a 3 bedroom. 3.5 bath, 2849 square foot penthouse at the Crown Condominium.

Currently there are approximately 10 residential buildings (single family, multi family, mixed use and income properties) for sale in East Harlem ranging from $1,150,000 for a two family house to an 8-story income property delivered vacant under construction condo for $15,550,000.


                                                                                             There is a rose in Spanish Harlem...




Apr 7, 2014

Determining Price Differentials for Floors & Views

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A seller recently asked what is the price differential for each floor in a Manhattan apartment building?

In Manhattan there are many variables in determining the price differential for each floor. A beautifully renovated apartment on a lower floor can sell for a higher price than an "original condition" apartment on a high floor.

The parlor floor in a townhouse may be worth more than the 4th floor if it's a walk-up. A 10th floor apartment facing the back will sell for less than the same apartment on the 5th floor directly facing Central Park.

Unless the building owns the air rights over neighboring buildings, views can and will change in Manhattan. A high floor facing an interior courtyard doesn't have as nice a view as the corner apartment on a low floor overlooking the park. Higher floors usually have a premium as do views. Both premiums can be separate. A view can be subjective. However, kitchens and bathrooms can be replaced but there is only one Central Park and Hudson river in Manhattan.

When pricing or determining value of a Manhattan condo or coop it is crucial to compare apples to apples. All coops and condos in Manhattan have an offering plan.

In the original offering plan whether new construction or conversion, the developer/sponsor put a price differential for each floor and unit in the building.

The sponsor determined premiums for each unit. Since all offering plans are from different years and during different market conditions there is a premium percentage for every attribute. In a coop, premiums for attributes are also allocated with more shares in the corporation.

Think in terms of percentages rather than arbitrary dollar amounts.

For example, if you're considering purchasing or selling in a building that was built or converted in the 80's, you can figure out the approximate percent of the premium.

If the same apartment, line, and square footage was selling in the $200,000 range originally and today the same apartments are selling in the $800,000 range, the apartment today is worth 4x more. If they're selling in the million dollar range 5x.

The premium for floor differential is 4x more whatever it was in the offering plan. If it was $2000 per floor in the offering plan, than it would be around $8000 per floor today providing the comparable apartments are otherwise the same. Price per share (in a coop) and price per square foot can also be used as evaluation tools. However, all square footage is not equal.

In today's transparent information age there are many online tools or "gimmicks" designed for automated instant home values. Take them all with a grain of salt. An algorithm looks at data logically. Real estate data isn't always logical. Selling and buying real estate is emotional not logical.

In Manhattan pricing a home is as much an art as a science.

Pricing a home is a marketing function, the price you get is a function of the marketing you choose.


Feb 10, 2014

NY Roommate Law

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Recently a couple of buyers have asked about the "NY Roommate Law" pertaining to "bylaws" rules and policies in a coop. Last year while I attended an exhibit at the Museum of New York about small spaces and the trend around the world of living alone, it was at that exhibit that I first learned it is illegal in NY for more than three unrelated people to live in an apartment or a house. 

The law, for decades part of the city’s Housing Maintenance Code, is little known, widely broken and infrequently enforced. NY has many housing laws that were reforms from the 19th and early 20th century tenements.

A landlord or coop may restrict the number of occupants based on housing/occupancy laws but you can generally take on roommates without having to add them to the lease or even get your landlord's approval.

Recently I've learned of "NY Roommate Law" Unlawful Restrictions on Occupancy Law. A law that entitles a tenant to have a roommate. This law trumps coop "bylaws" regarding the coop's right to approve all occupants living in a coop apartment. 

Roommate Law Explanation: 

If you are the only person who has signed the lease, in addition to your immediate family, NY law allows you to have another roommate who has not signed the lease. The roommate’s dependent children are also permitted. (Note: This law applies if the premises is the tenant’s primary residence)
·     Therefore, any lease provision disallowing a roommate that’s not on the lease (as well as his/her dependent children) is illegal.

·     If two or more people signed the lease you may have additional roommates provided that the total number of tenants and occupants (excluding dependent children) does not exceed the number of tenants on the original lease.

·     To make the above more clear, if 3 people sign a lease and 1 moves out, you can replace that person who moved out with a new occupant.  

      While many RE laws to protect tenants do not apply to co-ops, the roommate law overrides proprietary lease provisions that limit occupancy. 

This law allows tenants with leases to have roommates without interference from their landlords. While many tenant protection laws do not apply to cooperative apartments, the so-called Roommate Law does.

      The roommate law does not allow cooperators to circumvent the coops subletting policies, the coop shareholder must also reside in the apartment as its primary residence in order to benefit from the protection of the roommate law. 

Real Property Law, Section 235f "Roommate Law"

 Legal Disclaimer  - Information in this article is not intended as legal or financial advice and should not be used to substitute for advice of legal counsel.

Aug 22, 2013

Guarantors Co-Signers & Co -Purchasers

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What are Guarantors Co Signers and Co-Purchasers?


Over the years I have sold and rented apartments where a guarantor was needed. I have also sold apartments where parents and/or trust funds bought the apartment outright for an adult child or beneficiary.

A guarantor is simply someone who will cosign your rental lease and in the event you can’t pay the landlord rent or the coop maintenance they can legally go after your guarantor to collect payment.

In a condo it is very simple. A parent can buy for an adult child. A corporation and or a trust can buy a condo. Some condos have applications but many don't or have very simple applications. I  had a condo transaction where the couple obtained a mortgage from their parents. As far as the seller, listing agent and the condo were concerned it was a Cash Sale. Proof of funds  were shown with offer. A condo may require documentation but they can't reject a buyer. They can only exercise their "right of first refusal" and purchase the apartment for the same price and terms of offer.

It becomes more difficult purchasing a coop and even renting in certain Manhattan buildings. Most coops will not allow a parent buying for their adult child. Some coops will allow co-purchasing or a guarantor for working adult children. Some will not allow guarantors. In some coops even if the parents pay for the apartment, the coop will want the adult child residing there to be working with their own income and be responsible to pay the monthly maintenance and/or mortgage payments. The monthly housing costs can not exceed 25-30% of the adult child's monthly income.

Some rental buildings may require the parent to be on the lease. Some may not accept out of town guarantors and/or may require a few months of rent up front and additional security deposit. 40x rent in annual income is required by applicant and 80x rent is required to be a guarantor.

The coop will want full financial disclosure from both the guarantor and the applicant and from both applicants if a co-purchase. A guarantor letter and a gift affidavit is usually required as well.

An alternative to a condo purchase is purchasing a sponsor coop apartment. The sponsor is usually the developer or owner of building that has "unsold shares" in the cooperative corporation. I recently sold a coop sponsor apartment to parents in Ohio for their son that recently graduated college here. Purchasing a sponsor apartment in a coop is buying "unsold shares" there is no board approval process. However once purchased the shareholder has to adhere to the coop rules, enjoys the same "quality of life" as other shareholders but when unit is re-sold there is board approval and a board package is required.

I have worked with corporations looking for a rental apartment for corporate use. While the corporation has excellent financials, documented assets and cash flow, landlords will often require a personal guarantor.
 
While the Supreme Court of the United States ruled that a corporation is a person, New York landlords think otherwise. They want a personal guarantee from a person.

Lease "Good Guy" Guarantees:  

A good guy guarantee is a limited personal guarantee often written into a lease when a tenant is a business entity such as a corporation, partnership or limited liability company.

The guarantee, generally signed by a principal of the business entity, enables a landlord to bring an action against the guarantor in the event the tenant stops paying rent and continues to occupy the space.  A good guy guarantee is not necessarily onerous to a tenant. Although after a default, the landlord is free to pursue the tenant for unpaid rent (if there are any assets left in the business entity) the guarantor is released from its obligation to pay rent once the tenant vacates the space.  From a landlord's perspective, a good guy guarantee is an insurance policy against the amount of time it can take to evict a non-paying tenant (something that often takes a year or more).

Lease Guaranty Insurance:  

In many instances, individuals are unable to rent apartments they would like without a co-signer/guarantor, additional security or prepaid rent.

When a guarantor or co-signer is required, it is often difficult for a renter to find a third party that is acceptable to the landlord. For example, the prospective co-signer or guarantor may live out of state, or may not have the financial resources or credit to meet the landlord’s requirements. Recently an insurance company began a lease guaranty program.

The Insurent® Lease Guaranty Program was created to serve renters, landlords, condo/co-op owners,  by offering the first institutional guarantor of residential leases. The Insurent® Lease Guaranty Program is underwritten and issued by Argonaut Insurance Company, a property and casualty insurance company.

Instead of looking for a guarantor or co-signer, or having to pay a significantly larger security deposit or prepaid rent, a renter may utilize the Insurent® Lease Guaranty to satisfy the landlord’s financial and credit requirements if the landlord or coop will accept this new form of guaranty insurance.

 How to Rent an Apartment in Manhattan
 Buying A coop - Be Prepared and Qualified 
 Coop Board Requirements - What do Coop Boards ask For?

Sep 22, 2011

Manhattan Condops: Best of Both Worlds

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What is A Condop? 


A condop is a residential building or portion that includes cooperative and condominium ownership structure. The condominium has a residential cooperative unit separate from the commercial unit and or garage unit.  

During the late 1980's several new developments were built as "condops" they were "hybrids" because the developer had an underlying mortgage on the residential portion of the project. The residential unit is legally a cooperative. Owners are shareholders in a corporation.

A condo can not have an underlying mortgage. I was an original owner/shareholder in one of the first luxury condops constructed on the upper west side.

I often get calls from other brokers about The Boulevard since I'm a resident broker. Many agents think a condop is a coop with condo rules. In many condop buildings that is true but the rules have nothing to do with what makes the building a condop.
The Boulevard 2373 Broaway

In new construction, in the offering plan, if the developer/sponsor leaves the purchasers/ shareholders/owners with an underlying mortgage the building is usually a condop. The underlying mortgage is included in the maintenance allocated proportionally to each apartment sold as shares.

New construction condops include The Azure and 1 Carnegie Hill on the Upper East Side and 305 West 16th street, a brand new luxury designer condop building in Chelsea and there is a new condop in Harlem. 

Most condops have right of 1st refusal like a condo, they are investor friendly and have the same unlimited sublet policy and amenities usually found in condos.

The Savanah, 250 West 89th Street

A condop can offer the best of both worlds. It can offer rules and amenities of a condo, tax deduction, lower closing costs (no NY state mortgage recording tax) like a coop because a coop is not considered "real property" it is considered "personal property." Condops are usually valued in between a coop and a condo.

There is an advantage to buying a condop if you can find one in the neighborhood and price range you require.




Contact me to purchase or sell in The BoulevardThe Savannah or any other Manhattan condop, coop, condo or new development.

Sep 18, 2011

Apartments on Central Park West

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Views fromCentral Park West Apartments
View from 25th Floor San Remo Tower Penhouse

Central Park West runs along Central Park from west 59th street to West 110th street. The 8th Avenue subway B & C trains run along Central Park West.

Upper West Side zoning does not permit buildings to be taller than approximately 20 stories between 72nd and 96th Streets except the Art Deco Twin Tower buildings from the 1930's on Central Park West. The set back towers can go up to 30 floors.

 San Remo Towers, Brownstones

The buildings are mostly pre war buildings. The Upper West Side's Central Park West is home to some extraordinary buildings. Landmarks of Art Deco, Beaux Arts, or Gothic Revival architecture, the great celebrity apartment buildings of Central Park West have many famous residents and the side streets are lined with trees and 19th century townhouse mansions and brownstones.

The Upper West Side is populated with some of Manhattan's most famous and desirable residential buildings, many are located on Central Park WestThe Dakota, El Dorado, The San Remo Apartments,  The Oliver Cromwell, The Langham, The Kenilworth, Hotel Des Artistes, The Beresford, The Ardsley and the new post-modern 15 Central Park West feature spectacular apartments may with breathtaking stunning Central Park views.

The Ardsley
The Ardsley 


iPhone photos courtesy of:

Oct 6, 2010

Price per Floor in Manhattan Condos and Coops

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A buyer and seller recently asked what is the price differential for each floor of the same line in a Manhattan apartment?

In Manhattan there are many variables in determining the price differential for each floor. A beautifully renovated apartment on a lower floor can easily sell for a higher price than an "original condition" apartment on a higher floor. The parlor floor in a townhouse may be worth more than the 4th floor if it's a walk-up.

Views tend to be better on higher floors but that is not always the case. Unless the building owns the air rights over neighboring buildings views change in Manhattan. Higher floors usually have a premium as do views. Both premiums can often be separate. When pricing or determining value in Manhattan it is crucial to compare apples to apples.

All coops and condos in Manhattan have an offering plan. In the original offering plan whether new construction or conversion, the developer/sponsor put a price differential for each floor and unit in the building. The sponsor determined premiums for each unit. Since all offering plans are from different years and during different market conditions, I like to think in terms of percentages rather than an exact number.

For example, if you're considering purchasing or selling in a building that was built or converted in the 80's, you can figure out the approximate percent of the premium. If the same apartment, line, and square footage was selling in the $200,000 range originally and today the same apartments are selling in the $800,000 range, the apartment today is worth 4x more. If they're in the million dollar range 5x.

The premium for floor differential is 4x more whatever it was in the offering plan. If it was $2000 per floor in the offering plan, than it would be around $8000 per floor today providing the comparable apartments are otherwise the same. Million dollar range $10,000 range per floor.

In today's transparent information age there are many online tools designed for automated instant home values. Take them all with a grain of salt.  In Manhattan pricing is as much an art form as a science. Pricing is a function of marketing, the price you get is a function of the marketing you choose.


Sep 7, 2010

Fannie Mae Flip Tax Proposed Rule Change

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A draft rule has been issued by the Federal Housing Finance Agency for comment that would create serious problems for Co-op and Condo buyers. The rule would prohibit Fannie Mae from purchasing loans in buildings where there is a Transfer Tax/Flip Tax. 

Regulators have recommended such a rule and on August 12th a draft was issued for public comment. The link below will give you the details of the proposed rule. According to Fannie Mae, the primary intent of this proposed rule was not to have this apply to all Co-ops and Condos. 

Their primary intent is to stop developers from imposing 99 year covenants on new homes that require seller's to kick back a percentage of the sale price of the home to the developer when the home is sold. They are currently reviewing the concerns of REBNY (Real Estate Board of New York) and hopefully, will revise language that would correct this serious problem.

If their response does not assure REBNY that he rules will be corrected, REBNY will ask it's members to join them in reaching out to the New York congressional delegation. 

Link to proposed Rule Change:http://www.fhfa.gov/webfiles/1648/PrivTransFeeGuidance081210.pdf

Aug 29, 2010

The Oliver Cromwell | 12 W 72nd St. | Upper West Side

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The Oliver Cromwell 12 West 72nd Street



The Oliver Cromwell - 12 West 72nd Street

Architect Emory Roth completed this distinctive 30 story ornate building in 1927. Located mid block on West 72nd Street off Central Park West, the building converted to coop in 1984. There are 172 apartments.

The tower, has a buff brick fa├žade above a rusticated, three-story stone base and terra-cotta window surrounds in Italian Renaissance fashion at the fourth, fifth, sixth, 15th, and 26th through the 29th stories. The building has setbacks at the 16th, 19th, 20th, 21st 27th, and 29th floors.











It is very similar to Roth's Carlyle Hotel on the east side. The Oliver Cromwell is located on the Upper West Side of Manhattan. It is a pet friendly building and allows pied-a-terre. It has a garage, garden , storage and laundry room. Maximum financing allowed 75%,

Apartments range from 400 square foot studios starting at $300,000 to 700 square foot one bedrooms from $575,000 to 2 bedrooms from 950,000 to 3 and 4 bedroom tower apartments and penthouses up to $4.5 million.

Available Apartments

Jan 19, 2010

NYC Property Taxes Will Increase July 1

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The Department of Finance released a tentative assessment for all residential and commercial properties for fiscal 2011, which begins July 1st.

While property values may have dropped, according to the city, the total market value of property in NYC, including new construction rose 0.12% to $796 billlion. NYC taxes properties based on assessed value. Assessed value can rise even if market value declines.

Market values for coops and condos rose 4.04% and assessed values increased 5.09%. NYC Coops and condos are valued as if they were rental properties that generate income. Property values lag two years. Fiscal 2011 assessment is based on 2008 data. The Finance department will publish final assessment values on May 25th. The final assessment will be used to calculate property taxes for fiscal year 2011.

For more information: nyc.gov/finance

Jun 12, 2009

How Much Apartment Can You Afford?

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Understanding The Related Costs of Apartment Buying

You'll need to think about more than a mortgage payment to determine if you can afford an apartment in Manhattan. To assure you are purchasing a home within the confines of your budget, you must consider down payment requirements, closing costs, taxes, carrying charges, and yearly maintenance requirements as well.

How much can you afford?


First consult with a mortgage broker or banker to determine how much of a mortgage you qualify for. Calculate the estimated mortgage payment plus monthly maintenance (coop), common charges and real estate taxes (condo).

Several formulas exist to help determine how much a lender will allow a consumer to borrow. One of the more accurate formulas is a front- and back-end ratio. It states that the buyer can afford as much as 28 percent of his or her gross-monthly income toward the monthly mortgage payment, assuming that the consumer's other debt payments (credit cards, car loans, student loans, etc...) are less than or equal to 8 percent of his or her gross-monthly income.

Most NYC coops have stricter financial requirements than most lenders. Most coops use a 25% debt to income ratio formula. Many coops will only allow a maximum of 75% financing although some will allow 80%. Coops may also require liquid assets available after the closing to cover 2 years worth of maintenance or 1 year of mortgage and maintenance. Every building varies and uses their own formula.

While condos will allow 90% financing many lenders today will only finance 85% (LTV) loan to value. A minimum 15% or 20% down payment may be required. Before you start looking for an apartment in Manhattan you should be pre-approved and qualified by a lender.

Understanding your financing needs before you search for a new home will help you move ahead quickly and confidently when you find the right home.

May 8, 2009

Tips to Help Pass a Coop Board Interview

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I've recently been asked by a few buyers about the coop board interview. Below is a re-post that I wrote a while back that gives tips to help you pass a coop interview. I've also include a link below to a post about NYC closing costs for condos and coops.  

Here are some tips to help pass a coop board interview:
  • Being called for an interview is a good sign it means you look good on paper.
  • Be on time, dress appropriate for the building and neighborhood. Conservative is best.
  • Bring a copy of the board package with you. Be familiar with all your financials and everything in the board package.
  • Coop boards are stricter than banks, don't assume because you have a commitment from a bank you will satisfy the coops financial requirements.
  • Be able to substantiate questions about your package.
  • More is less do not elaborate and ask questions, an innocent question might offend a board member.
  • It is better to have a short interview than a long one.
  • Do not go into details about elaborate and costly renovations.
  • If the apartment has outdoor space do not discuss barbequing, it is illegal and smells.
  • Do not ask questions or bring up sublet policy or pet policy uless the board brings it up.
  • It is not a job interview, you don't have to try and sell yourself.
  • Let the board ask the questions, set the tone and conduct the interview.
  • Boards like candidates willing to volunteer to serve on the board or building committees.
  • Boards look for candidates that will "fit in" and follow rules.
  • Don't ask or expect a decision on the spot they will notify you within a few days.
  • Be prepared for a lack of privacy and to answer personal questions unless they are Fair Housing /NYC Human Rights violations.
  • The NYC Human Rights Law prohibits housing discrimination in New York City based on a person's real or perceived race, color, national origin, gender, creed, disability, sexual orientation, marital status, partnership status, alienage or citizenship status, age, lawful occupation or because children may be or will be residing with you.
Closing Costs for NYC Condos and Coops

Feb 13, 2008

Coops with Retail Space Benefit from New Laws

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President Bush's plan to relieve mortgage debt could be a boon to NYC co-ops. The Mortgage Forgiveness Debt Relief Act of 2007 will allow co-ops to raise rents for their retail tenants, which could bring in more money to pay for staffs and capital improvements and can lead to reduced monthly maintenance fees, the New York Sun reported.

The federal 80/20 law had mandated that no more than 20 percent of a coops income could come from outside sources including commercial tenants. This law had become a problem for many coops that include retail space in their buildings since retail rents have gone up significantly.

A change in the law modified those rules late last year, and co-op boards can now get high rents for their retail space and use the income for building operations and improvements without losing their coop tax status, the New York Times reported.

Under the new law, co-ops need to pass one of three tests so that shareholders can qualify for tax benefits, including deductions for property taxes and mortgage interest and the right to shield up to $500,000 from capital-gains taxes when the apartment is sold.

The original 80-20 rule is one test. The second requires at least 80 percent of a building’s total square footage be available for use for residential purposes by tenant shareholders. And the last is for a co-op to spend at least 90 percent of its total income for the benefit of shareholders.

Coops now only need to show that that a building is 80 per cent residential or that at least 90 percent of the total income benefits shareholders.

When considering purchasing a coop apartment, buildings with good retail tenants will have income from a source other than shareholders. These coops most likely can offer services and improvements without raising maintenance fees or imposing an assesment. And that can translate into higher values for the apartments.

Jan 15, 2008

The Beresford

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The Beresford
The Beresford a coop building so vast it contains three separate lobbies fronting both Central Park West and West 81st Street.
It has three addresses 211 Central Park West, 1 West 81st Street and 7 West 81st Street. The building was completed a month prior to the stock market crash in 1929.

The Beresford is a master piece of architect Emery Roth. The building has 175 apartments on 23 floors with a limestone base and brick-clad upper floors.

The courtyard contains a fountain and a garden. Italian Renaissance in design, the Beresford is executed in brick with limestone and terra cotta trim. Animating the walls is a distinctive blend of late-Renaissance sculpture: winged cherubs, angels, dolphins, rams' heads and rosettes.

The Beresford is where Rock Hudson had his "classic six" home away from Hollywood. After the star died of AIDS in 1985, most of the contents of his Beresford apartment were auctioned off at William Doyle Galleries in New York, bringing prices that far exceeded the auction house's expectations.

Fans fought over many of the items from his apartment including the footstool that 5-foot -4 inch Elizabeth Taylor used to reach the 6-foot -5-inch actor's Beresford bathroom sink while staying in the apartment in 1981. Written on the stool in lavender ink are the lines "E.T. stood here (she had to because she couldn't reach the sink) R.H. is a love, and I thank him always --even tho he is one foot taller. Your always friend, Elizabeth."

The Beresford has many famous former and current residents. Current resident Jerry Seinfeld had extensive major renovations to his apartments at The Beresford. His renovations went on for a very long time annoying the other neighbors and famous residents. Because of his lengthy renovations NYC coops enacted a new coop regulation called the "Seinfeld Rule." For every day that a renovation continues after it's scheduled completion date the apartment shareholder must pay the coop fines of $500 a day.

Jerry Seinfeld also bought a Townhouse on West 82nd Street for $3.95 million adjacent to his Beresford apartment for his cars. In that townhouse real estate transaction his broker wasn't available to show him the townhouse on Saturday because of religious observance. Jerry negotiated directly with the seller and tried to cut his broker out of her commission. A judge ordered Seinfeld to pay her the commission.

Built in 1929 The Beresford converted to a Co-operative in 1962. The Beresford has six (6) Attended Elevators, A Fitness Room, Laundry Room, Private Storage, Washer/Dryers and Pets are Allowed. Maximum financing allowed is 50%. There is a 2% "transfer fee" paid by the seller. Residential Street, Block: 1195, Lot: 29, Community Board: 7, School District: 3. Prices in The Beresford range from $2.5 million to $31 million.

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Oct 29, 2007

Hotel Des Artistes - 1 West 67th Street

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Originally built to house painters and sculptors, this beautiful 1918 building - with studios that feature double-height windows and wonderful light - quickly began to draw artistic residents from other fields.

In 1922 Rudolph Valentino America's hottest movie star at the time rented a bachelor pad at Des Artistes, even though he was married to his second wife, Natasha Rambova at the time. Actually he was still married to his first wife, Jean Acker because his divorce in California would not be final until the following year.

Valentino was charged with bigamy in California. Fed up with Hollywood's provincialism, Valentino and Natasha escaped to New York. Not wanting any more trouble from the authorities Valentino moved into des Artistes alone. Natasha resided with an aunt who lived on the same west 67th street block.

Besides Valentino, des Artistes famous former and current residents included artist Norman Rockwell, playwright Noel Coward and former NYC mayor John Lindsay.

On the ground floor of the Hotel des Artistes is the elegant Cafe des Artistes - noted for it's naughty murals by resident Howard Chandler Christy.

As of this writing there is currently one active listing at the Hotel des Artistes.

A large 1 bedroom duplex, plus home office or Den, with 2 baths. Original wood paneling in living room and all original details throughout the apartment.

Price: $1,630,000 - monthly maintenance: $1277.

Hotel des Artistes converted to a coo-op in 1970. Building amenities include a Garden; Fitness Room; Pool; Laundry Room; Rooftop Deck;

For more information about Hotel des Artistes or any other Manhattan building please contact me.

Sep 8, 2007

Manhattan Coop Financing Allowed

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In Today's NY Post an article titled The 25 Percent Solution By Jane Reilly Mount reports about a coop in the meat packing district. The author is a shareholder, the board raised the required down payment from 15% to 25%.

The author reports that real estate agents living in the building are opposed to the 25% and would prefer 20%. The pros and cons discussed were:
  • Pro: higher-percent down payment from new buyers protects current residents now and in the future.
  • Con: hurts those residents looking to sell now by narrowing the pool of potential buyers.

An increase in the amount required for a down payment does not bring any additional revenue to the coop. The down payment goes to the seller. The coop and shareholders benefit by having more qualified buyers that most likely can afford financial emergencies.

Every coop has different financial needs. Some coops would rather have a buyer with a large mortgage and liquid assets than an ALL CASH buyer that is using up all their assets to buy the apartment.

IMHO the financial requirements for purchasing in most Manhattan coops has insulated the Manhattan residential real estate market from the current mortgage/housing/foreclosure crisis taking place throughout the rest of the country.

In many parts of the country home ownership "The American Dream" has become an entitlement. Buyers didn't need to save for a downpayment with 100% financing and many didn't even need incomes to purchase with stated income loans.

75% of home ownership in Manhattan is in coops. Buyers looking for coops have to be financially responsible and extremly qualified. The required down payment automatically gives coop shareholders equity and an asset the day they close. Manhattan coop home owners have some "skin-in-the game."

A study conducted by Miller Samuel and NYU in 2003 studied the amenities and attributes including financial requirements of NYC apartments.

The study used the 60 to 79 percent financing-allowed category -- the most common -- as the reference point. The study concluded the higher the barriers the higher the coop sale price.

Co-ops that allow 80 to 99 percent financing had a 2.71 percent discount from the reference point. Co-ops allowing 40 to 59 percent financing saw a 14.55 percent premium. Those that allow 10 to 39 percent financing had a 22.19 percent premium. All-cash co-ops, those that don't allow any financing, had a 47.94 percent premium.

Jun 1, 2007

Manhattan Neighborhood: Harlem

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(updated 10/1/2011) 
Harlem was established in 1658 by the Dutch and named Nieuw Harlem after the Dutch city of Harlem. This large section of Manhattan real estate has a deep spirit, culture and history.

Harlem passed through several historic periods - as a high-society area of New York for wealthy upper class and middle class white residents...as a fashionable district for blacks during a period known as the "Harlem Renaissance"...as one of the hottest night club playgrounds for audiences who came uptown to see the all black revues to gangsters and entertainers in grand style at the famous night spots.

Beginning in the 1870s Harlem was the site of a massive wave of development which resulted in the construction of numerous new single-family row-houses, tenements, and luxury apartment houses, New York's black middle class began moving to Harlem.
During the "Harlem Renaissance" of the 1920s, Harlem became the urban cultural center of black America, with its center around 135th Street between Lenox and Seventh Avenues.

Affluent African-Americans began moving to "Sugar Hill" in the late 1920s. "Sweet and Expensive," signifying that one had arrived, economically and socially Sugar Hill was celebrated for its exclusivity and status. The Hill attracted those with talent, money, education, and social prominence.


  • East Harlem/El Barrio (Spanish Harlem) community stretches from First Avenue to Fifth Avenue and from East 96th Street to East 125th Street.
  • Central Harlem stretches from Central Park North to the Harlem River and from Fifth Avenue to St. Nicholas Avenue.
  • West Harlem, including Hamilton Heights and Sugar Hill, stretches from 123rd to 155th Streets and from St. Nicholas Avenue to the Hudson River
For the last few years there has been another wave of development and construction in Harlem. New condo development has surged in Harlem like the rest of Manhattan and there appears to be enough demand by buyers to meet supply.

111 Central Park North

A luxury glass condo at 111 Central Park North currently has 2 available 3 bedroom apartments for sale for $2,399,000 and $2,690,000. (Oct 1, 2011)

Recent sales data: A 4 bedroom 4.5 bath 2897 square foot Penthouse recently sold for $4,525,000. (Oct 1, 2011)

It appears Central Park North is getting numbers equivalent to prices on Central Park West, Central Park South and Upper 5th Avenue. Harlem condos typically sell for $550 to $800 per-square-foot. Townhouses run $350 to $500 a square foot if it requires no renovation. If it's a shell, and one can still be found it's about $250 to $300 a square foot.

A diversified mix of New Buyers think Harlem is an exciting place to live because it is still on the island and they are priced out of downtown. They are coming to Harlem for the neighborhood's history and the immaculate houses on Strivers Row and new condos all over Harlem. The fixer-upper brownstones that were a steal have been gone for a couple of years now. Most Townhouse owners have cashed out already. Many have been renovated and many sellers have priced them too high. 

Developers have converted brownstone, shells of buildings and narrow vacant lots into condominium apartments. For Manhattan home buyers, this new wave of condo conversion in Harlem provides an opportunity to live in a neighborhood with small-scale buildings. Harlem zoning does not allow for very large buildings. These apartments, typically floor-throughs and duplexes come with town house amenities, like terraces, gardens, fireplaces, and uncommonly good light for Manhattan.  

There are new condo townhouses from Morningside to amilton Heights. Many of the new construction condos are on Frederick Douglas Boulevard.

New larger buildings with doormen and other amenities have gone up on Harlem's Avenues. Many of the new developments are along Frederick Douglas Boulevard.
88 Morningside venue88 Morningside Avenue
88 Morningside Avenue, Harlem, Morningside Heights is a new construction condo set among tree lined streets and pre-war buildings directly opposite Morningside Park. Current available apartments at 88 Morningside range from a 625 square foot one bedroom to a 1300 square foot Three bedroom 2 bath home for just under $900,000. (Oct 1, 2011)

  
The Dwyer Condos - Warehouse Lofts at 123rd Street
 
The Dwyer condos at 123rd and St. Nicholas are more like downtown loft buildings.
Harlem is a location with history, spirit, culture and affordability. 

Harlem may be the neighborhood you are looking for. 

All the new construction in Harlem it hasn't lost its old historic flavor. There are still many prewar buildings and beautiful 19th century townhouses featuring fireplaces and molding and lovely backyards.

Harlem is home to Columbia University and the world renowned Apollo Theater where such greats as Duke Ellington, Count Basie, and Aretha Franklin performed. One of the area's most notable attractions is the Cathedral of St. John the Divine. This awesome Episcopal cathedral, on 112th Street near Columbia University, is exceptional in its melding of Gothic, Byzantine and Romanesque architecture. More and more businesses are flocking in to meet the needs of this resurrected neighborhood.


So take the A train up to Harlem and enjoy the history and affordable housing!



©nyc Blog estate 2006-2011

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May 16, 2007

New law may require coops to give a reasons for a board turn-down

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One of the first blogs I ever wrote was last July about a new law that would make the once secret Co-op sales prices public for the first time under a bill by the Albany legislature. The bill was awaiting signing by Governor Pataki and was strongly supported by Mayor Bloomberg.

When the law passed I wrote another blog in August NYC-Coop-Law-brings-Manhattan-Real-Estate-into-the-21st-Century. Before the law was passed there were many in the real estate industry that were opposed to the new transparency law. They liked having secret information that was how business was always done in Manhattan and they liked it.

nyc seal

Janny Scott of The New York Times recently wrote an article Pushing coops to Explain why you can't buy about a bill before the New York City Council that will require Coop Boards to Explain why they are rejecting a buyer.

A city council member from Queens Hiram Monserrate introduced a version of the bill in 2004. He visited my office at one of our sales meetings introducing and explaining the bill to us and discussed the coop application process and rejections. All the agents in my office were behind the bill to make coop boards accountable and to get some transparency from the secret way in which coop boards decide which buyers to accept and which to reject.

While New York City is considered a progressive city with good civil rights and fair housing laws (11 protected classes) most home owners in Manhattan live in coops that are private corporations equivalent to private clubs.

Under current law coops do not have to offer any explanation when they reject a potential buyer from their building. Coops also do not have to tell buyers or brokers exactly what their requirements are or what they are looking for in a buyer. They can change rules and requirements when ever they want.

Having had two coop board turn downs in my career one as the listing agent and one as a buyers agent It can devastating for the buyer, the seller and the brokers. The seller might have already gone into contract on a new place and will likely lose their deposit. As the listing agent I was able to sell the apartment to another buyer. Rejected buyers are humiliated not knowing why they were rejected.

While I do honestly believe most coops are reputable and are only concerned about the buyers finances I also believe in a city as large as New York with so many coops that require no special skills, training or credentials to be elected to a board abuses and discrimination can and will take place.

Now nearly two-thirds of the members of the City Council are co-sponsoring a measure for a little more transparency from the secretive process by which co-op boards decide which apartment buyers to accept and which to reject. The bill wants co-op boards to be required to give their reasons for rejecting an applicant, and to do it in writing within five days of rejection. Seems quite reasonable to me in this day and age.

However, the same groups that opposed making coop sale prices public including REBNY (the real estate board of New York) which I am required to be a member of and pay dues to be a broker in NYC is opposed to it and is lobbying the city council to vote against it. REBNY members include management companies that represent coop boards. The council of New York Coops and Condominiums is also opposed to it.

IMHO the oppositions argument has no merit. If they are not discriminating and have valid reasons to reject someone then they have nothing to hide so they should put it in writing.

They are saying if you give reasons why someone is rejected it will open coops up to law suits. The New York Times article quoted Richard Siegler, a lawyer who represents co-op boards and condos. "Maybe someone has been turned down because he is a cheater at the golf club. This is something that is not discrimination, and it's just very difficult to put in formal language or even in every case to give a reason. It has been this way for a long time."

So does that make it right because it has always been done this way for a long time. Even though there are Fair Housing laws it is difficult to sue and prove discrimination if they are not given a reason or explanation. Many questions on most coop applications are illegal according to Fair Housing laws.

IMHO if someone cheats at the Golf club or they are obnoxious or they have blond hair or what ever "so called valid reason" the coop has for the rejection if the coop doesn't know how to explain that or if that is even a reason to reject someone then I believe the board deserves to be sued. If they don't have a valid reason they should not be allowed to get away with it anymore.

We are talking about buying an apartment. Financials or building quality of life issues like renovations should be their only concern. It is about time that coops explain their actions and are accountable.

 
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