Posts Tagged ‘manhattan real estate’
Saturday, February 16th, 2013
Posted by Leonard Steinberg on February 16th, 2013
It’s official in the mainstream press(although looking in the rear-view mirror is often a bit late): housing prices across the board are rising: Prices for single-family homes climbed in almost 88 percent of U.S. cities in the fourth quarter as the housing recovery broadened. The best-performing metro area was Phoenix, where prices increased 34 percent from a year earlier. I am estimating escalation in Manhattan this year of around 10-15% and I fear that escalation has already happened, with jaw-dropping speed…….just as we predicted a few months ago. It will take a while for many buyers to adjust to the ‘new normal’. Once upon a time, $ 1,000/sf seemed like a steep price to pay……now that’s what you pay for a storage room. The effects of LUXOFLATION have taken hold. Remember what Mayor Bloomberg said a few years ago: until the housing market recovers, there will be no recovery. Now one could be certain that economic recovery has officially begun.
The median sales price rose from a year earlier in 133 of 152 metropolitan areas measured, the National Association of Realtors said in a report yesterday. In the third quarter, 120 areas had gains. An improving job market and low interest rates are driving up prices by fueling demand for a tightening supply of listings. The national median price for an existing single-family home was $178,900 in the fourth quarter, up 10 percent from the same period last year. That was the biggest gain since 2005, according to the Realtors group.
So what’s next? Rising interest rates? Sub-prime mortgages? Excessive home equity loans? Hopefully the folly of previous cycles is not repeated…..
Monday, January 14th, 2013
Posted by Leonard Steinberg on January 14th, 2013
It’s official: the luxury real estate market in New York has turned and it is now officially a SELLER’S MARKET. After attending and holding several open houses yesterday, with activity levels not seen in years, there is no doubt in my mind that there are far more buyers than there are sellers right now.
Several buyers I had spoken to said they had been looking for over 1 year already……their optimism for finding a bargain, let alone the perfect home, was fading. Several mentioned how they had raised their budgets only to be further disappointed. I guess many buyers are like serial daters: always looking for perfection, but scared of committing to something just in case something better comes along…..
Additional indicators are that properties listed last year where there were tepid or no offers are now being met with multiple offers. I do not see pricing soaring, but it is very possible we could see the average price of luxury properties in Manhattan escalate between five and ten percent in 2013. Some may exceed this where there is very limited supply.
Many buyers will feel additional frustration when they discover the only apartments they like include an 12-24 month wait…..then again, they may have no options.
Wednesday, October 17th, 2012
Posted by Leonard Steinberg on October 17th, 2012
As always, the press has just caught on to the fact that construction is experiencing a mammoth surge….it started months ago, but now the data is out with enough hard evidence to prove a point I have been making for quite a while. Groundbreaking on new U.S. homes surged in September to its fastest pace in more than four years, a sign the housing sector’s budding recovery is gaining traction. The Commerce Department said on Wednesday housing starts increased 15 percent last month to a seasonally adjusted annual rate of 872,000 units. That was the quickest pace since July 2008, though data on housing starts is volatile and subject to substantial revisions. New York is experiencing this same hive of activity, even though REBNY just reported that this is the worst decade in history for new construction…..2 years into the decade: will they revise their estimates sometime in 2035?
In Manhattan, construction sites are roaring to life: New activity was spotted at 56 Leonard Street yesterday, and everywhere there are steel beams, concrete trucks, and thousands of new jobs. This morning I witnessed a huge truck transporting a massive steel beam being towed because it had parked illegally overnight. Architects and designers barely return calls. The noise, dust, traffic jams are back! Surely all of this must bode well for the economy in general, even though it may make our lives a little more stressful.
Augusts’ starts were revised to show a 758,000-unit pace instead of the previously reported 750,000. Economists polled by Reuters had forecast residential construction rising to a 770,000-unit rate. The housing starts rate is now about 40 percent of its peak in January 2006. The housing market, the Achilles heel of the recovery from the 2007-09 recession, is slowly healing. September groundbreaking for single-family homes, the largest segment of the market, rose 11 percent to a 603,000-unit pace – the highest level since August 2008. Starts for multi-family homes climbed 25.1 percent. Building permits grew by 11.6 percent to a 894,000-unit pace in September. August’s permits were unrevised at 801,000 units.
And as we have said before, all of this is resulting in the ‘i-WORD’…..inflation. If anyone thinks this new spurt of activity and buying won’t affect pricing, think again. The press is not reporting it right now……but you’ll read about it pretty soon.
Monday, October 15th, 2012
Posted by Leonard Steinberg on October 15th, 2012
The Wall Street Journey reports this morning about the Boomerang Buyer who through foreclosure in the 2008 financial crisis lost their home and is now back in the market ready to buy. In New York, we have a slightly different Boomerang Buyer: The buyers who left the market, sold their apartments and rented in fear, who are now re-entering the market to buy as rental rates soar and interest rates make buying slightly more affordable. The major problems these buyers are encountering is the the low inventory that provides few options, and pricing……yes, while many thought pricing was at a peak in 2008, the reality is that new peaks are being achieved daily, and buying to-day is almost certainly more expensive than it was before or after ‘the crash’. In some instances it is MUCH more expensive: and the new buildings coming to market now are priced well beyond those new buildings launched in 2007 and 2008. I am however seeing some LOTTERY SELLERS somewhat dismayed that the elusive Russian/Chinese/Tech billionaire has not swooped in to buy their significantly over-priced properties.
Monday, October 1st, 2012
Posted by Leonard Steinberg on October 1st, 2012
Flat solar panels are becoming increasingly efficient, yet they do take up quite a lot of space. The Spin Cell could be a game-changer. On their website V3 explains that if one places a 20x solar concentration on a flat, static solar panel then the temperature quickly reaches 260 degrees F, the solder melts within ten seconds, and the PV fails. With the same concentration on the Spin Cell, the temperature never exceeds 95 degrees F. These spin cells produce 20x the amount of energy than the same sized solar panel. Maybe Bill Gates is right after all: our energy solutions will be solved through technology. i think these are actually quite attractive, certainly more attractive than most of the hideous mechanicals placed on rooftops in Manhattan.
Saturday, September 22nd, 2012
Posted by Leonard Steinberg on September 22nd, 2012
Is BRICFLATION upon us? In this morning’s Financial Times a story addresses a potential pricing bubble in the Central London new construction real estate market, where it was identified that just under 20% of the buyers are UK citizens and the majority buyer pool are foreign, mostly from the far east. With growth slowing in these countries, is there a pricing bubble at play?
New York has been aflutter with talk of ‘all the foreign buyers’, and indeed they have become a sizeable force: Are they artificially boosting pricing here too? What is the percentage of foreign buyers? 5%? 10%, 25%? Data is showing that the vast majority of buyers are indeed domestic, although at many of the brand new buildings (and there are not that many……yet) a good chunk of the buyers have indeed come from BRIC countries. Is this demand pushing pricing up beyond reality? New York pricing is still comparatively cheap next to London. In Miami a huge pool of foreign buyers has helped a recovery, especially in prime new buildings.
Only time will tell in Manhattan how much of the coming construction boom will be bought up by local or foreign buyers: And will BRICFLATION be a concern in the coming months and years. One 57 certainly has a large chunk of foreign buyers, but that is a mere sliver of the market…..when those units close in 2013, watch out for those prices boosting averages artificially for sure.
Friday, August 24th, 2012
Posted by Leonard Steinberg on August 24th, 2012
Now that I am on vacation in the hot-hot South of France, I have had more time to absorb the world’s craziness and get a better global perspective. While watching the BBC this morning, I caught up on world events and wanted to compare the following to the statement I keep hearing again and again from sellers in New York: “Yes, but if we price it really, really high, I bet a rich Russian buyer will swoop in and pay the miracle price!”
I agree, that statement is crazy, but when compared to other crazy-thinking currently throughout our planet one may better understand the inspiration. Here are some examples:
1) Mitt Romney says its CLASS WARFARE to discuss the fact that he pays 13% in Federal taxes when other rich people pay double…..as do many upper middle class tax payers. Isn’t it class warfare to think you belong to a different country club that allows you to pay so much less in taxes than your (almost) equal neighbor? Why are YOU one of the chosen few who can do this? Who did the choosing? The same happens with real estate taxes in Manhattan, another class warfare, but not between rich and poor or middle class…..its class ‘war’ between the same classes where neighbors pay vastly different real estate taxes for almost identical properties, well, just because…..! This is not a partisan political statement at all as I consider those bilking the welfare system (legally of course) to be as guilty of moral corruption as Mitt. Both are abusing the system.
2) Ecuador, a country best known for its moral and ethical leadership (ranked 26th out of 29 countries in the South and Central America/Caribbean region: its overall economic freedom score is well below the world and regional averages), is demanding that Mr. Assange, the WIKILEAKS founder, be released immediately from Britain so that any charges against him related to having sex with under-age girls cannot be investigated. How moral. How ethical.
3) The GOP wants less government interference in our lives: I think thats a GREAT idea. Of course when it comes to abortion, many in the GOP want the government to insist that a 13 year old girl who has been raped, should bring the devil-seed baby to this earth through a 9-month pregnancy that is certain to wipe out any of the child’s youth that has not already been wiped out by the rape. Then of course because she is a child, this child should give up her child to adoption and once again experience more trauma through the separation. And then that devil-seed child whose chances for developing into a functioning member of society are slim at best should go out into society and thrive, probably requiring government assistance or better yet, a $ 100,000 per year jail cell….paid for of course with taxpayer dollars, that the GOP don’t want to collect.
4) Iran was on TV this morning, OUTRAGED that the USA is not providing the drugs its people so desperately need to save lives. This is coming from a country that is demanding the death of the United States. Surely when the USA is dead we will be unable to provide these drugs too?
5) Obama has spent nearly $59 million through his main campaign account — $10 million more than he raised, financial reports filed late Monday afternoon show. The cost of his campaign so far: more than $325 million, not counting spending by the the Democratic Party committees aiding his re-election. Does Obama think spending more than you earn, even for an election campaign, will lead voters to believe he can balance the budget of the USA?
6) Greece is OUTRAGED that the EU might want to oust it from the Eurozone. Outraged! Of course their contribution to the EU has been negative at best…. they have allowed a sector of their population to fleece and drain their economy, and another to rely entirely on government handouts….. but of course they DESERVE the gratitude and kindness of the other European countries. Surely Germany should foot the bill while the Greeks continue with their reckless practices? In Greece lies a good real estate twist though: the last thing the Greeks can turn to now in their desperate attempts to stay afloat is of course…..their real estate! They are seriously considering selling off some Greek islands (land leases) to pay down their mounting debts. REAL ESTATE TO THE RESCUE AGAIN!
Monday, August 6th, 2012
Posted by Leonard Steinberg on August 6th, 2012
Dolly Lenz, the star of tonight’s CNBC show “Secret Lives of the Super-Rich Mega-homes” is certainly the most entertaining and slickly produced of all the real estate reality-style shows on TV to-day…it makes the others look a little wimpy, low-end and almost amateurish. The Dakota? Time Warner? Karl Lagerfeld: thats’s primetime!.Everyone has an opinion on Dolly, but boy does she come out looking good in this show. It’s almost like an infomercial selling DOLLYWOOD to the world. Manhattan real estate has never looked better. Is Dolly the next Robin Leach but with more muscular calves?
Tuesday, July 24th, 2012
Posted by Leonard Steinberg on July 24th, 2012
Today a report to be released by Zillow indicates that home prices in the second quarter rose from the year-ago period for the first time since 2007, according to a closely watched index, the latest indication the housing market is starting to recover. In the quarter ending in June, home values were up 0.2% from the same period in 2011.
Like most other reports, this report is too a reflection of closed sales, hence a bit of a time delay on what is really happening in the markets right now. In Manhattan we are seeing a very unusually busy July, traditionally a slower Summer month. We are seeing multiple bids everywhere. Properties that once sat idle are in contract. The inventory shortage is worsened by the fact that fewer people will list a new property in the Summer. And the fear of the new construction inventory coming to market being priced around $ 2,000/sf and up is (wisely) scaring buyers into committing to a property now before an inevitable further escalation occurs…..while they can still commit to the low interest rates.
In my opinion Zillow’s data is not a great reflection for the Manhattan market because the time it takes for a property to get signed to closing is unusually long here: the best reflection of what is going on in the market in real time is a report on signed contracts: while not 100% accurate, it is much more reflective of current market conditions. That is why LUXURYLETTER is so widely read, the only monthly report on signed contracts AND closed sales.
We have been hearing of vastly improved activity in pricing in many other markets around the country for some time now. In my building alone, an apartment sold for $ 1 million less a year ago…..and indicator of price escalation over 15%. This is unusual, although the very high end of the market appears to still be experiencing LUXOFLATION, the inflation that applies to the super-luxury market and can be witnessed in art, car, and other luxury goods pricing, field by a growing international wealthy community.
I feel certain that once this new wave of inventory hots the market, priced higher than where many apartments are trading to-day, the averages will rise in Manhattan again, and a new ‘normal’ will set in.
Tuesday, February 14th, 2012
Posted by Leonard Steinberg on February 14th, 2012
A perfect Valentine’s gift came to-day in the way of proof that the West Side of Midtown will no longer be isolated from the rest of Manhattan: the tunnel connecting 11th Avenue and 34th Street and Times Square is completed and now the finishing process has begun to deliver the # 7 subway extension by the end of 2013. This is great for New York real estate as easily accessible public transportation defines neighborhoods and boosts their value tremendously.
This transportation addition will revolutionize the West Side forever, and area that had been traditionally too far removed from central New York City to be considered convenient. Once the Hudson Yards are built, not to mention the dozens of other buildings sprouting in the area, this neighborhood will become a thriving area, connected to both the hudson River and Central Manhattan.
Seeing is believing!