The gap between buyers and sellers still yawns

“In New York, the plunge hasn’t happened yet; instead, the market has ground to a halt,” according to one of several articles in New York magazine. “Many sellers have dropped their asking prices to levels not seen for a few years, but the reductions can’t keep up with the savings expectations of would-be buyers. So sales volume has decreased dramatically: It is down by almost half in Manhattan in the last quarter when compared to the same period of the year before, according to a report by the appraisal firm Miller Samuel for Prudential Douglas Elliman. It’s the same story in Queens, and even worse in Brooklyn, where sales are off 57 percent.”

The end of last year was terrible for sellers, and the beginning of this year was hardly better.  Now that the usually high season for the Big Apple’s real estate market has begun, the signs Continue reading

There are two sides to the housing equation

As Realty Times notes, the $8,000 tax credit for home buyers is available only available to individuals who make no more than $75,000 or couples earning no more than $150,000. It can be used only by first-time homebuyers (defined as one who has not owned a home for at least three years.)

Why not make the credit available to anyone who purchases a home? asks U.S. Rep. Ken Calvert, a Republican (of all things) from California. In fact, why restrict the number of credits available to any one purchaser? If someone buys two homes, let them have double the tax credit.

What better way to shrink the nation’s burgeoning inventory of unsold properties?

Skeptics will say that such a plan would benefit investors seeking to rent out their apartments and houses and sucking up federal dollars. It’s hard to see Continue reading

A new tool gauges price reductions

There’s no way of judging the validity or even determining the ultimate usefulness of what Trulia has just introduced.  But the Web provider of information about real estate properties says consumer now can see on its site how many of them have had price reductions in various cities. Trulia’s research has found that 27 percent of homes currently on the market across the United States have experienced at least one price cut. Across 15 major cities, including New York City, Chicago, Los Angeles, Boston and Atlanta, the average price reduction for homes ranged from $20,000 to $295,000.

Which city had the most reductions? New York, which, according to Trulia, saw prices cut in 39 percent of the listings. The company created three tables, for the U.S. as a whole and properties listed at above or below $1 million.

What concerns me is the quality of the database. Continue reading

California is a state where the sun don’t shine

A blog from the Field Crest Group warns that Foreclosure start (NOD) and Trustee Sale (NTS) notices are going out to California homeowners at levels not seen since mid 2008. “Once an NTS goes out, the property is taken to the courthouse and auctioned within 21-45 days,” the blog says. “Two months from now, the foreclosure crisis will be top of the news once again catching everyone off guard because of the past six months ‘intervention’.”

And that’s not all the group says in a post filled with alarming charts.  It notes that in California:

  • Defaults are surging to the highest level yet, reaching 54,022 in March;
  • Subprime defaults are declining;
  • Alt-A defaults are skyrocketing;
  • Pay option ARM defaults are surging;
  • Jumbo prime defaults are relentlessly continuing;
  • House prices are bottoming, “but for the wrong reason.”

Present values of properties at the notice-of-default stage are clearly rising due to the shift in the mix of loans/properties going into default from lower to higher,” the blog contends.   “This ‘mix-shift’ effect may push up median house prices in 2009 creating the appearance that the market is improving when in reality it is because more higher-value properties are defaulting, being foreclosed upon and reselling through the Realtor network.”

Anyone who has managed to plow through the mortgage information in my newsletter knows that California has been one of states hardest hit by the bursting bubble of the housing market.  Will its experience Continue reading

It’s that time of year

Whether it was the high temperatures or the high season for property buyers, most of the eight open houses I visited on the Upper West Side today had very good traffic and generally had sharply reduced or realistic prices. Maybe, too, it was the street fair running north from 96th Street to Morningside Heights that boosted traffic.

One especially busy apartment was a small and otherwise modest penthouse with a 1,500-sf terrace that had its price cut from $499,000 to $399,000. The views in three directions are open and sunny, the kitchen is small and barely serviceable, and the bedroom represents a tight fit. So what’s the catch? The maintenance: $1,769, attributable to that big terrace.

Interestingly, the broker is marketing the property by saying that all offers over $399,000 will be considered. That’s a novel strategy; it signals buyers that low-ball offers will not work and it brings in buyers who might not bother looking at a higher-priced property. I, for one, think that’s shrewd marketing in today’s environment.

Look for more on this property and others in one of my next newsletters.  You can search listings from various brokers yourself as well.

Going to a street fair is like seeing the same movie over and over.

Going to a street fair is like seeing the same movie over and over.

Balloons and musicians and clowns, oh boy!

Balloons and musicians and clowns, oh boy!

As usual, there was all the overpriced greasy food you could stomach.

As usual, there was all the overpriced greasy food you could stomach.

Malcolm Carter
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com

Mr. Toll of the Brothers Now Sounds Hopeful

CEO Robert Toll told Jim Cramer that he “definitely” sees things differently now and that about 80 percent of the nation is on its way back. He cited as evidence an increase over the past five weeks in “expressions of interest;” those are refundable deposits that start the home-buying process. The number of these deposits is better than any other time over the past year, he said. “Now last year stunk,” Toll acknowledged (ungrammatically). “But then again it sure feels good to be doing better rather than worse.” He added that the trend was “pretty much nationwide, except for a couple of markets that are still deader than doornails and probably will be for another year or two.”

You can watch the video here and compare with the predictions of other soothsayers in my newsletter.

Malcolm Carter
Licensed Associate Real Estate Broker

Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com

There are brokers and there are brokers

Two days ago, I e-mailed a broker who shall go nameless about a $2.7 million Upper West Side apartment in which a client had an interest. She wanted to know the square footage, which did not appear in the listing, and whether there was a doorman, about which the listing also was silent. There being no reply to the e-mail, I telephoned the broker today and, shockingly, reached him on his cell phone.  Said he, “I never got the e-mail,” a refrain all of us have heard from individuals who are unmotivated to respond. (They are probably the same folks who don’t bother responding to an R.S.V.P. in invitations.) Isn’t it astonishing that the broker has been the only person in two days who didn’t get an e-mail from me?

Moreover, it turns out that my customer’s questions don’t need to be answered: The broker told me in our telephone call that, after 26 weeks on the market, the owner has decided to rent out the co-op and perhaps list it again when sales pick up.

So that listing broker failed to do three things: He didn’t return my email, didn’t update the listing and didn’t grasp the significance of a potentially hot buyer. He never bothered to say he would show the apartment, even if it was available for rental, to someone who might well have made a decent purchase offer. How is that serving his seller well? How do you spell l-a-z-y and i-n-c-o-m-p-e-t-e-n-t?

For more about the broker community, see “It Will Never Ever Happen Here” in my post below. For latest listings of Manhattan apartments ranging in size from studios to so-called “trophy” condos and co-ops, check out the bottom of my newsletter.  And to see my critiques of properties I see at open houses several days a week, check out “Out and About” in my bi-weekly newsletter.

Malcolm Carter
Licensed Associate Real Estate Broker

Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com

Well, yes, it is that bad

In a long New York Post piece, a number of real estate stars and executives are quoted as saying that things aren’t so bad in the Manhattan housing market.  One broker (who happens to retain a publicity agent) is quoted as saying the Upper West Side has weathered the storm best in terms of price.  If that’s true, pity the rest of Manhattan.

At broker open houses on the Upper West Side today, for example, four of the five I visited almost at random had undergone price cuts.  One was listed by a new broker after the previous broker failed to sell the totally renovated, three-bedroom co-op for $2.7 million and then $2.4 million.  It is now $1.995 million.  What does that say about prices?  Maybe the bottom is in sight after all.  But the storm has belted the whole island, no matter what anyone says.

Malcolm Carter
Licensed Associate Real Estate Broker

Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com

Should this seller renovate yet again?

Checking out some open houses for Manhattan real estate brokers today, I entered one rich in personality and poor in views. The view from one of the two bedrooms is pretty much the same as shown, south and west toward Riverside Park and the Hudson River. The view from the living room, however, could hardly be more depressing; it is into a dark courtyard.

The listing broker acknowledges the views issue. But she seems to be more worried about the quite new, high-end kitchen, which the architect-owner did in grey and scarlet. The broker is suggesting to the owner that he re-do the cabinets, an expensive and wrongheaded undertaking.

I acknowledge that a segment of the market won’t like a kitchen that makes such a strong statement. But it makes much, much more sense to lower the price than attempt to rope in a somewhat larger number of potential buyers. Either someone is going to like or put up with the kitchen at the right price, or others will fix on the kitchen as the clearest reason that the apartment doesn’t feel right to them.

The question is who is going to stomach the views and somewhat odd configuration of an apartment that, at close to $1 million, is overpriced by around $100,000. Much better to cut the price than invest in new cabinets. Changing the kitchen or keeping the same new kitchen just won’t make enough of a difference. Save the money!

View from a Bedroom

View from a Bedroom

View from the Living Room

View from the Living Room

Understandably, some buyers may have a limited reservoir of imagination.  Sure, the owner made the best of a bad thing in a gut-renovated Upper West Side apartment that has been stylishly, individualistically and thoughtfully designed.  But that doesn’t make the unit a good thing for so much money, even with colors that have appeal capable of attracting more buyers, many of whom understandably may have a limited reservoir of imagination.  You know, the vision thing.

Malcolm Carter
Licensed Associate Real Estate Broker

Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com

It Will Never, Never, Ever Happen Here

The Houston Realtor Association (HRA) has launched a program that allows buyers and sellers to rate the performance of Realtors.  The association is permitting its approximately 23,000 members to opt out of what it terms the “Client Experience Rating” program,  and 1,000 Realtors signed up in the first month.  The ratings cover competence, market knowledge, communication and the rater’s experience of the Realtor.  On a five-point scale, the average was 4.93.  (Since participation of the Realtors is voluntary, can you imagine how the remaining 22,000 would be rated?)  A few real estate companies also promote ratings, but HRA is the only such professional association known to do so.  And oddly, the program does not appear on the HAR Web site without a site search.

Here in New York City, only a small minority of sales associates and brokers have joined a local association affiliated with the National Association of Realtors, which has a strict code of ethics.  As for the Real Estate Board of New York, to which most brokers grudgingly belong, its code of ethics is barely publicized and infrequently followed if my experience can be generalized.  (Nor, for that matter, is there faithful compliance with local laws against housing discrimination or the U.S. Fair Housing Act, which, among many other things, implies a prohibition against advertising a property as ideal for a “family.”  What does a family consist of anyway?)

Winking as they do at REBNY’s toothless enforcement of its code, as well as the law, many agents and brokers would be horrified to have their sellers and buyers rate them in New York, where so-called “pocket listings” continue to exist and where the best interests of buyers and sellers are all too commonly ignored in the interest of concluding a transaction, maximizing a commission or both.

Compared with D.C., Virginia and Maryland–where I was a real estate broker who, like virtually all other brokers in the area, was a member of the NAR–I continually am impressed with the laziness and indifference of a multitude of brokers here in Manhattan.  I hasten to say that not all brokers should be painted with the same brush and that I do often encounter those who are profoundly professional.

But the threshold here and elsewhere of being licensed to sell real estate is abysmally low.  With such low standards and such contempt for their customers and clients (never mind by them), can you imagine New York City sales associates and brokers embracing a rating system such as Houston’s?  I certainly cannot.

Malcolm Carter
Licensed Associate Real Estate Broker

Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
http://www.ServiceYouCanTrust.com