The Big Apple: Rent market hot, otherwise warm

Manhattan condo prices have yet to recover fully

From its peak in December 2008 to its trough in May 2009, the RPX Manhattan Condominium price declined 24 percent, according to Radar Logic.

Since then, it has regained only about half of the value it lost during the crash.

As of March 31, the RPX Manhattan condominium price was $1,017.10 per square foot, which is 16 percent above its cyclical trough of $923.24, but still 12 percent below its all-time peak of $1,212.83.

Sales activity also remains well below pre-crisis levels.  Activity during March 2011 was 18 percent lower than it was during March 2008, before the national housing crisis took hold of the Manhattan market.

Although the rate of sales increased robustly during 2009, its recovery has faltered since, with the transaction count declining 3 percent over the last year.  There has been a clear shift in the concentration of sales from smaller to larger units over the last year.

Buyers are still out there and having offers accepted

Buyers continue to step up and sign deals for Manhattan property at a very strong pace, according to a new post by Noah Rosenblatt of UrbanDigs.

Finding in his excellent data fewer properties on the market, inventory levels flat compared with a year ago and sellers being disinclined to take properties off the market, he says “there is no summer slowdown yet.”

High Line proves successful in ways exceeding its value as a park

As it was poised for the opening of its second segment this week, Mayor Bloomberg proclaimed that the High Line has revitalized a swath of the city and generated $2 billion in private investment surrounding the park.

The mayor pointed to the deluxe apartment buildings, the glass walls of which press up against the High Line, and the hundreds of art galleries, restaurants and boutiques it overlooks.

All of that commerce more than makes up for the $115 million the city has spent on the park and the deals it has made to encourage developers to build along the High Line without blocking out the sun, Bloomberg said. On top of the 8,000 construction jobs those projects required, the redevelopment has added about 12,000 jobs in the area, the mayor said.

Developers of the Upper West Side’s Corner rental building reap big rewards from its sale

The developers of the Corner, the popular Upper West Side rental tower that opened last year at 72nd Street and Broadway, have already cashed in, selling their 196-unit property to retirement system TIAA-CREF for $209 million, according to the Wall Street Journal.

The developers had spent more than 20 years assembling the prime development site and will hold onto the 48,000-sf retail space in the building, currently home to Trader Joe’s, Bank of America and Duane Reade.

The sale price for the rest of the Corner — including its generous amenity spaces — works out to more than $1 million per unit, or around $1,400 per square foot, about double that of the typical rental apartment transaction. One bedrooms in the building rent for $5,000 and $6,000 per month.

BrickUnderground inaugurates renter referral program

BrickUnderground has launched its Renter Referral Program, a service designed to “take the Russian Roulette out of finding a good Manhattan rental agent.”

The premise is pretty simple, says site founder Teri Karush Rogers: Rather than find an agent by clicking on random apartment listings or walking into the nearest brokerage, renters will be paired up with someone who not only knows what to do but wants to do the best job possible to remain in BrickUnderground’s referral network.

Foreclosure rates worsen in the region as amount of negative equity tops all others

Foreclosure rates in New York-White Plains-Wayne jumped to 5.08 percent in March, according to a report by CoreLogic, up 1.47 percent from March 2010, when the rate was 3.61 percent. Foreclosure activity in the area remains higher than the national average of 3.57 percent in March this year.

The mortgage delinquency rate in New York-White Plains-Wayne also has increased. According to CoreLogic data, 8.48 percent of mortgage loans were 90 days or more delinquent compared with 8.25 percent for the same period last year.

While the average borrower in the U.S. was underwater by $65,000 in the first quarter, area borrowers owed an average of $129,000 more than their homes are worth, the highest in the nation.

But Property Shark documents a two-year spike in co-op foreclosures

The number of co-op units scheduled for foreclosure spiked to its highest level in two years, according to PropertyShark.

In May, co-op apartments made up 79 percent of all new foreclosure auctions scheduled. Some 90 co-op apartments were in foreclosure, 15 times more than the same time last year.

The May total was up from the previous month as well, by 34 percent.

Demand grows for sky-high rentals, vacancy rate plunges to five-year low at all levels

Given the still skittish state of the real estate market, many individuals of means are choosing to rent—often at very high prices—rather than buy.

There are indications that demand for high-priced rentals, some of which top a healthy annual salary, is rising. According to data from Streeteasy.com, more apartments priced at $10,000 and above per month were rented in May than in the same time period last year and the year before, and those apartments went off the market faster and without cuts in price.

Indeed, brokers say that finding tenants for five-figure rentals often is easier than in the lower brackets.

As for lesser mortals, pickin’s are slim: The Manhattan vacancy rate in May fell to 0.7 percent, its lowest level in nearly five years, according to broker Citi Habitats. Landlord concessions, such as a free month’s rent for signing a new lease, have dried up.

Average Manhattan rental prices are just a hair below their 2007 peaks.

When renovating, be sure to nail down the right kind of estimate

To avoid expensive mistakes, says general contractor Yoel Borgenicht, you need to have the right information in estimates for renovations.

On BrickUnderground, he details what needs to be there, including itemization, payment terms, schedule, availability, tasks and due date.

Two-thirds of rental units have price protection or subsidies

Despite a recent decline in the number of rent-regulated apartments, nearly two-thirds of the city’s 2 million rental units still enjoy price protections or government subsidies, according to a new state report.

The analysis by Comptroller Thomas DiNapoli found that 1.4 million, 64 percent, of the Big Apple’s 2.1 million apartments are rent-controlled, rent-stabilized, taxpayer-subsidized or publicly owned.

DiNapoli attributed a decline of 10,000 rent-regulated units largely to late 1990s measures that allow landlords to deregulate units after they go vacant or when the monthly rents on the units surpass $2,000.

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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
Web site
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