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Posts Tagged ‘luxury letter’
Friday, April 1st, 2011
 Posted by Leonard Steinberg on April 1, 2011
First Quarter reports released to-day embarassingly distort the Manhattan real estate market statistics: They talk about a sharp drop in average pricing (like there is such a thing as average in Manhattan) but fail to mention that the reason for this is the low inventory of new construction condominiums that would automatically distort “AVERAGES”. Yes, more co-ops sold this quarter, not because they were more desirable, but because there is a shortage of new condo’s. To any buyer, I would say beware: averages are dangerously misleading.
For a more accurate reflection of what is happening in the market right now, not the reports that reflect CLOSED sales, most of which happened in the market 2-4 months ago, read LUXURYLETTER. its not perfect at all but it definitely is a better insight into the market as it is happening, not the market of yesteryear…. Click here for the latest LUXURYLETTER: :http://www.luxuryloft.com/files/luxuryletters/LUXURYLETTER_April_2011.pdf
Sunday, October 24th, 2010
 NOT SEEN ON YOUR STREET, BUT COMING TO YOUR WALLET SOON. The foreclosure mess could hurt homeowners in Manhattan in an indirect way: The costs of buying an apartment and paying off the mortgage are likely to go up, say housing experts.
The rising costs will come both during the closing and throughout the life of the loan.
At the closing, the cost of title insurance, which protects a property buyer from claims of ownership made by other people, is likely to rise, industry officials say.
“At a closing last week I witnessed an ‘additional title insurance fee’ to cover additional insurance.,” says Leonard Steinberg, managing director of Prudential Douglas Elliman and publisher of LUXURYLETTER.
The foreclosure mess has sent insurers scrambling. One of the largest, Old Republic Title Insurance, told its agents on Oct. 1 not to issue policies on homes that have been foreclosed by GMAC Mortgage or J.P. Morgan Chase. And on Wednesday, the nation’s largest title insurer, Fidelity National Financial, said lenders must vouch for the accuracy of their paperwork before it will insure properties.
Just like homeowners-insurance rates rise after a hurricane, the rates for title insurance are expected to rise, to compensate for the added risk.
The turmoil will likely lead to pricey premiums for new homeowners, says McLean, Va.-based housing economist Tom Lawler. Adds Cameron Finlay, chief economist at mortgage lender Lending-Tree.com: “Any time there is uncertainty in the market or risk implied, it follows that costs go up.”
Other costs could be felt during the life of the loan. Until the current mess, servicing loans was a low-margin, high-volume business. Servicers collect mortgage payments from borrowers and send them off to mortgage holders, and if the loan gets into trouble, they manage the foreclosure. Few doubt this process will get costlier now that it is under scrutiny from regulators and the courts. That higher cost likely will show up in higher interest rates for borrowers.
Both of these higher costs also would hit homeowners who refinance their loans.
How much the costs of buying a home will rise is unknown. Mortgage industry officials say it is too soon to tell. And no one believes the costs will significantly change the price of a home. So if you thought anyone was immune to the foreclosure mess, think again.
And no, Manhattan is not immune even though foreclosures are still extremely rare here. The only good news: all these rising costs equal INFLATION, not the worse option, deflation. Owning real estate during inflationary times is a good thing.
Monday, July 26th, 2010
THE ROLLER COASTER DECADE It is becoming increasingly apparent that we live in turbulent times: the see-sawing we are experiencing in markets (and life in
general) appear more acute and exaggerated these days, and I fear we have entered a decade of constant ups and downs.
With every bit of good news that emerges, so too does an equally impressive list of bad news. It seems every day the stock market escalates it is followed by a day where the market ‘plunges’. The press terms a 1% drop a ‘PLUNGE’: Is 1% really a plunge? Plunge is defined as ‘to descend abruptly or precipitously, as a cliff, road, etc.’….so does a 1% drop constitute a plunge? I think not. Yet this is our new reality: a world where a dramatic headline is much more important than a calm, accurate inventory of what is really going on.
Unfortunately, press headlines define people’s perception of reality as no-one seems to have the time or inclination to examine the substance of an issue anymore. One side says a balanced budget with austere cuts is critical to solving the world’s financial problems, yet the other side says doing so instead of continued stimulus will PLUNGE us into a third depression (Paul Krugman, New York Times). The same side that says legalizing un-documented immigrants is bad for the economy and the country, idolizes all of Ronald Reagan’s economic policies, even though Ronald Reagan legalized millions of illegal’s because he felt it was good for the economy. Unemployment figures improved, and the banking sector hired 6,800 people in the past 3 months. Warren Buffet says all his companies are hiring across the board. Then housing figures came in: sales dropped, yet pricing rose, and housing starts dropped, which was viewed as bad news by some and good news by others (lower inventories generally stabilize pricing and valuations).
Maybe if we eliminated the words PLUNGE and SOAR from our vocabulary, and watched the economy unwind from a more balanced perspective we could all benefit. We are emerging from the most serious recession of the past 100 years, yet we want double digit growth back over night. The recovery will be slow and rocky at times. A price will have to be paid for bad behaviour and policies. New technology will continue to change the landscape of employment.
Of course in these panicky, irrational times, great opportunity exists to buy the best real estate. With more choices, extremely low financing rates, and virtually no new great inventory, long term buyers will be rewarded…..but not in the next quarter: let’s leave that thinking to Wall Street.
And buckle up: it’s going to be a bumpy ride!
Leonard Steinberg (Editorial from LUXURYLETTER: www.luxuryletter.com)
Friday, April 2nd, 2010
In this month’s LUXURYLETTER, (www.luxuryletter.com) it was reported that Manhattan’s real estate pricing and activity picked up notably over the same period last year. Because LUXURYLETTER addresses the luxury market over $ 1 million, the figures are somewhat different to what is being widely reported….
The other reports that came out from the major real estate companies reported that Manhattan apartment sales doubled in the first quarter as bargain-hunting buyers scooped up co-ops and condos in a market where resale prices have fallen an average 29 percent since their peak. This figure is skewered as it does not address new construction pricing. And as we all know averages are often meaningless.
The number of sales soared to 2,384 from 1,195 a year earlier, New York appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate said today. The median price for a co-op or condo slid 11 percent to $868,000.
Values fell across apartments of all sizes as New York City recorded 10.2 percent unemployment in February. Fallout from the recession and credit crisis that cost more than 184,000 finance jobs in the Americas is still hurting New York. The city lost 5.4 percent of its finance industry jobs in the 12 months ending in February, the state Labor Department said March 25.
Lots of this information is pertinent to the housing market, but not as much for the luxury market.
Monday, March 1st, 2010
In this month’s LUXURYLETTER ( see www.luxuryletter.com) the reports indicate a moderately healthy market, with strong activity on the higher end of the Manhattan Downtown luxury market.
Signed contract and closing activity levels are healthy, and pricing for the most part is stable, although drops have been seen in some areas: this does not necessarily indicate a trend as this is a month-by-month report and overall pricing is stable when compared to 6 months ago.
A NEW TREND: We have seen several suburban buyers enter the market looking for a City residence to buy that they will use full time in about 3-5 years. BUT, they want to buy now at current pricing levels fearing that prices will rise significantly in a few years. Is this a real trend?
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Samantha 
keep it up! happy easter!!
Nice and very informative post. Your point of view is more or less the same as main. Thanks!(Charlxtz)