New York City First time home buyer and Investor MUST READ!

This is Part 1 in a 5 part series focusing on what a first time buyer or investor should know before they purchase an apartment in New York City and the most common mistakes to avoid.

We will cover- Know What You Are Buying, Know Your Buying Power, Financial Report of the Building, Who is Managing the Building, What's Your Timeframe, and more!

Understanding the Products: (Co-Ops, Condos, Condops, Townhouse)
Buying an apartment in New York City will be an exciting and also daunting experience. Because New York City offers a unique buying experience with many of its own quirks and differences the first step for any New York City first time homebuyer or first time investor is to become well informed and educated about the different real estate products you will be looking at to ensure your experience will be as calm and rewarding as possible.

1. Co-Op:

A phenomenon that's almost unique to Manhattan, the Co-Op Apartment, has been the traditional form of ownership in New York City for the last century. About 80% of all apartments available for purchase are in co-operative buildings. Co-ops are owned by an apartment corporation. When you purchase within a co-op building, you're purchasing shares of the corporation that entitle you, as a shareholder, to a "proprietary lease." The bigger your apartment, the more shares of the corporation you own.

Standard Co-Op apartments:
Board approval is required. You are buying shares of corporation, you are required to put down 20% or more of down payment, there will be a full financial disclosure, debt to income ratio requirement and board interviewing process. Each Co-Op building has their own financial requirements and criteria, some are more flexible than others, such as allowing guarantor, co-purchase, gift money from parents, pied-a-terre, your debt to income ratio, work history, down payment required...

Subleasing a co-op can be difficult. The board of directors will have to approve the prospective tenant subleasing your apartment. Each building will have their own rules regarding for how long you can lease your unit and other criteria.

All prospective purchasers must interview with the Board of Directors. Prior to the interview, prospective purchasers prepare a detailed "Board Package" which usually contains personal and professional letters of recommendation as well as a great deal of personal information concerning income and assets.

Sponsor Co-Op apartments:
NO Board approval is required. These are Apartments that are held as an investment by the sponsor , the original developer who built the building or converted the building to a co-op. Sponsor units command a premium because people who might not pass a board or don't want to go through a board approval process can buy them.

For example, a sponsor unit would be a good choice for parents who want to buy an apartment for a child who is a student. A sponsor unit may be the best apartment for someone who is not working, or only has a short job history. Buyers of a sponsor unit should take note that they will need to pay NY State and NY City transfer taxes, and often the seller's attorney fees. You still have to submit a board package (Homeland Security! The management company needs to know who is moving into their building) and you almost always have to abide by the building's house rules as far as sublet requirements and pets.

2. Condominium:
Unlike Co-ops, you are buying Real Property. You hold title to your apartment unit plus a percentage of the entire project in common with all other owners.
Resale condo apartments:
These apartment units are previously owned. The sellers are individual owners. There is still a monthly common charge similar to the maintenance charge in a co-operative. These charges don't include your real estate taxes and are not tax deductible. They also tend to be lower than in co-ops because there is no underlying mortgage for a condominium building.
There is no board approval process like a co-op, typically you can finance up to 90% of the purchase price and sublet them at will. Condominiums are the number one choice for flexibility. Because there is more scarcity and flexibility owning a condominium there is a premium paid to own a condominium compared to buying a co-op apartment.

New Development Condo apartments:
These apartments are brand new construction or pre-construction. They are being sold by sales agents of the developer. Buying into new construction has its perks such as being able to pick out the best apartment unit that suits your need, particular floor apartment, or apartment built to your specification if you get in early... Some of the disadvantage of new development would be, uncertain on closing date, not able to know exactly what the apartment looks like, the building management track record, and the possible higher closing cost than resale condo apartments.

3. Condop: Co-Op with Condo rules.
The special hybrid of a Co-Op and a Condo, the Cond-op. When buying into a Cond-op, you are buying shares of corporation, as you would be if you were buying into a standard Co-Op, but the major difference is that the policy and the rules of the building will be Condominium rules. These rules would be unlimited sublet policy, able to resale the apartment unit immediately with no board package and interview, investor friendly, a lot more flexibility.

4. Townhouses:
Townhouses are sometimes bought as hey are non-uniform units in certain neighborhoods or streets in New York City that are designed to mimic detached or semi-detached homes. The distinction between dwellings called just "apartments" or "condos" is that these townhouses usually consist of multiple families, usually multiple floors. The price range of the townhouse is usually higher than single unit of condo or co-op apartments.

Which is Best for YOU???
That really depends on your specific situation and what your goals for purchasing are. If you are looking to buy an investment property and rent it out immediately then a condo or condop would give you the most flexibility. Are you a first time buyer who has fallen in love with prewar apartments with their high ceilings, fireplaces, ornate details, well then a co-op will probably be in your future. Are you looking for privacy, a house in the city, more square footage than in a high rise, looking for an exclusive property, a townhouse might be a good option. What type of property is best for you depends on your personal preferences, your financial situation, your long term goals, and many other important factors. If you have just started thinking about purchasing it may be in your interest to contact a real estate agent for a free consultation regarding what type of property in New York City might be right for you.

This is part one in a series centered on first time buyers in New York City, our next post will focus on the next step in your process, KNOW YOUR BUYING POWER!

What Makes New York City Amazing, $801,000 for a Storage Room!

A basement storage room sold for $801,000 in the renowned Dakota apartment building. The Dakota, located on Central Park West, is most well known as the home of John Lennon and still is the current residence of Yoko Ono. The apartments sell for upwards of 10-20 million dollars.Now this was no ordinary damp tiny storage room. The room was about 800 square feet had 20-foot-high ceilings and two windows. There is a bathroom and electricity wired already into the unit. Despite The Dakota being one of New York City’s most expensive and desired buildings there is no common exercise room for the building residents. The new owner of the storage unit was planning on converting the room into a small gymnasium and opening it up to the buildings residents. How altruistic of him!!
Space is at such a premium in New York City that I not really that surprised by this sale. First is the fact that if you can afford a $20 million dollar apartment, an $800,000 storage unit is probably not too much of a stretch in your budget. If you look at the price per square foot it really is not that much in New York City standards. It’s just at $1,000 a sq/ft, some condominium buildings have been selling at $3,000+ sq/ft recently.

I live in the Upper West Side and I walk by the Dakota to go to Central Park. It is an extraordinary building. The location is perfect right at 72nd and Central Park West. The architecture is absolutely eye-catching. You can’t help but check out the building. I’ve never been in any of the apartments in The Dakota, but when I do I will make sure to ask if a basement storage room comes with the unit knowing what one could sell for.

Relocating to Manhattan

Having the unique experience of starting my real estate career on the West Coast in Seattle, WA and now being an agent in Manhattan has given me the ability to help first time home buyer’s relocating to Manhattan.

I grew up on the West Coast in Seattle, WA and started selling real estate once I graduated from the University of Washington. Relocating to Manhattan from Seattle was definitely a culture shock, so I understand what its like to move the big move here. I understand the buying process in a more traditional real estate environment and then coming to an almost entirely different experience buying or renting real estate in New York City.

In Seattle, apartments meant rental apartments. If you were renting, you said you lived in an apartment. In Manhattan everybody lives in apartments, except for the small majority of townhouse owners. In Seattle, I sold my fare share of condominiums, but never a co-op. I wouldn’t even know where to go look for one if somebody asked for a co-op building. When I tell my first time home buyers that when they buy a co-op, they don’t actually own their apartment. Instead, they own shares of a corporation that owns the building they live in, they are a bit surprised at first, but not as surprised when we go look at apartments and they see the compact size of some of the spaces.

In Seattle I owned my own 2 bedroom 1 bath house. I thought my kitchen was tiny, but it was huge compared to the kitchens here. I would consider a spacious kitchen here to be maybe 8x8 with just enough room for two people to be in the kitchen at the same time. A lot of the kitchens in the studio apartments are the size of a closet. Your mini kitchen will include a two burner cook top, the refrigerator you use to have in your room in college, and a couple of cabinets, and a tiny sink. The lifestyle here is to eat out a lot more so the necessity of a full size working kitchen is not as important.

Another aspect of relocating to New York City is getting use to the jargon used specifically describing apartments. What is a 2bd, 2ba, w/d, wfp, eik, CAC, Triple Mint Apartment? The use of triple mint condition is overly used in my opinion. If an apartment has been remodeled recently it means triple mint, if it’s been well maintained it becomes triple mint maintained. The high end property descriptions are fun to read just to see how they create this fantastic beautiful language describing exceptional properties.

Because I have sold real estate in the more traditional setting I understand the point of view of the buyer relocating to Manhattan and what they understand as the conventional real estate buying process. I can bridge that gap to understanding the New York market and facilitate a smooth transition to either buying or renting a New York City apartment.

The Champagne of Tap Water

"New York City water is the best in the world. It's the only thing that tastes right to me."

The reason that I found this article so interesting was because I am originally from Seattle, WA. and I always thought that we had the best mountain water anywhere.

When I learned of the passion that New Yorker's had for their very own water I had to learn more.

Like some massive God-given Brita filter covering 2,000 square miles on both sides of the Hudson River, the oak and pine forests, the organic vegetable farms, the muddy swamps and all the other green space in the watershed provide New York City one of the purest, most abundant supplies of drinking water of any metropolis on Earth.

New York's remarkable water depends partly on natural phenomenon: (the gradual slope of New York State towards the city moves water by gravity, not pumping), geology (underlying rock and minerals in upstate soils are ideal for removing pollutants) and lots of rain. The success is human invention too, boasting the longest tunnel in the world and more stone than all the pyramids in Egypt, together moving 1 million gallons of water every minute.

More stone than all the pyramids in Egypt, that sounds impressive.

When Goodfella's Restaurant on Staten Island took first place in the 2007 International Pizza Expo in Las Vegas for their Smokin' Goodfella(made with a blend of smoked cheeses, roasted peppers and sweet Italian sausage), they also hauled in their hometown aqua pura. (This was the 4th time they won the competition; although the toppings changed, the water remained the same.)

I have yet to eat this pizza, but I look forward to eating it one day.

When Steve Ross of the Coney Island Bialy and Bagel bakery made his specialties at the 2001 Smithsonian Institute Folklife Festival, he brought 36 gallons of New York's finest.
But interviews with bakers, brewers and food chemists indicate that Gotham's tap can't take credit for the quality of bagels and pizza. "Water is unlikely to be a major factor compared to flour quality and bakers' skill and competition and consumers' demanding standards," writes food chemist Harold McGee in an email. "NYC water is just not that different from most municipal waters."

Even if the water doesn't affect the taste of baked goods, several bakers acknowledge that the relatively neutral pH of the city's water means that, compared to dough made with more alkaline water, dough bearing New York water better lends itself to kneading, including large-scale automated kneading that the bagel and pizza industries depend on. Some experts have said that "New York's water is juicy with notes of clove and a hint of benzene."

I didn't know the scientific makeup of water had so much to do with baking or could be described as juicy with notes of clove and a hint of benzene. I had to go on Wikipedia to find out was benzene is and I'm still don't know how it could be used to describe water.

I do admit that the first New York bagel from H and H Bagel changed what I thought of bagels forever. Despite the great water here, I haven't found a cup of coffee or latte that can compete with a latte from the Pike Place Market in Seattle, WA.

So the next time you visit New York, don't order a bottle of Perrier at a restaurant, ask for an iced tap water and know that you are having the Champagne of Tap.

(Source: edible Manhattan)

How is the Market!?

Well that depends! Are you interested selling, buying, or investing? This is the number one question people ask us right now about Real Easte. There is no singular answer. What we do know is that we are continuously working and helping our customers who have specific and real needs to buy or sell property. Relocation, expanding families, downsizing, financial problems, these are the reasons why our customers are buying now.

More frequent communication with sellers is needed. In this market, sellers are counting on professionals to keep them inform as to what is going on with the current market, the activities or sometimes the lack of activity on the market place. Sellers (the motivated) ones are willing to listen to offers, counter offers, and possibly accept less than what they think they can get if it is an ALL CASH buyer. However, I have not yet seen a seller that is willing to sell it at a 'basement fire sale' price.

On the buyers' side, if ones does not need financing, and yes, this is the market that we would consider CASH IS KING...
I think this is a great time to go out there shop around and make aggressive (not necessary low ball) offers.

We have also seen an upturn in rental business. Renters are seeing more and more incentives being thrown their way in the form of reduced rents, free first months rent, other creative offers to attract more activities.