People often say that “you never get a second chance at a first impression”, and if that’s true with people it’s even MORE true with real estate. Buyers make up their mind practically the minute they step their foot in the door on if they’re going to love it, hate it or just like it. More often then not, if they’ve done their research they usually “like” it. Liking it however, is not enough to buy it.
It starts with the general look and feel of the place, and while everyone’s preferences are subjective the following trends are unanimously panned by buyers.
When I was living in Downtown Brooklyn, I had a completely different vision of Crown Heights. Admittedly, it wasn’t a very clear image, more a blurry collage of an up and coming neighborhood just below Atlantic and south of the always-in-the-news Bed-Stuy. Having recently become a neighborhood transplant, what I saw overwhelmed me. The pace of development is shocking. In the midst of garages, storage units, and car washers, were these incredibly charming nooks reminiscent of 90s Williamsburg. There were the requisite just-quirky-enough bars – the Way Station, Washington Commons, and hipster / neighborly coffee shops like Sit and Wonder which runs a book exchange, and Crosby Coffee. But what really impressed me were the large ambitious spaces like 1000 Dean St, Five Miles Gallery and Bergn’n. And while Berg’n gets all the press it isn’t the only restaurant in the neighborhood worth trying. Barboncino makes a mean pizza, and Gen’s sukiyaki is very memorable. It’s clear that people had discovered this and are moving in in droves, new developments are sprouting up in just about every workable piece of land.
New Developments are taking center stage this year. We’ve all heard about the developments happening in Manhattan, 57th St. has been restyled as “Billionaire’s Row”. One57 makes headlines on a seemingly daily basis and 520 Park Avenue is already one of the most discussed new developments. But while Manhattan is scrambling to take “most expensive condo ever” crown, Brooklyn is developing some of its own glossy new condos. See the select projects below, some of which have recently launched sales, and some of which are expected to launch this quarter or next. Enjoy!
Corcoran’s Year in Review for Brooklyn has just been released, and the numbers are just as staggering as we expected it to be, highlights include:
- Average Condo and co-op price grew 12% higher than a year ago.
- Average price per square foot grew 9%
- Overall median price increased 3%
New development was quickly absorbed despite escalating prices. More new development inventory is expected to come online this year ~ 1,300, (325 per quarter) but that is still not expected to meet demand. As a result of the lack of new development inventory, the resale condo market has experienced a 4% uptick in sales compared to last year (2013).
The new development that is scheduled to come online in the next couple quarters is quite eye catching, and will no doubt be snatched up quickly, I selected a few to highlight.
There comes a point in your life (read children) when New Yorkers make the decision to either stay NYers or move to the suburbs. And when you reach that decision point everyone will have an opinion, your friends who are in the same anxious am-I-actually-considering-this state, to been-there-done-that-and-know-what’s-best, and of course family. No doubt the suburbs has its allure. Who can deny the SPACE? After losing yet another bidding war for a 2BD walk-up half a mile from the subway, the value and ease of the suburbs gets even more attractive.
Many suburban residents will tell you that all of the culture and convenience of the city is actually (and unbelievably) available in the suburbs, along with stars, crickets, and a backyard. And they aren’t completely wrong, the Jacob Burns Film Center in Pleasantville NY hosts just as enviable an array of independent films as the Angelika, Madison NJ’s town library is massive and hosts indie films, they also host operas, exhibits and sold out Shakespeare plays all year long. One of my ex-Brooklynite neighbors described the suburbs as “having everything the city does but closer and with less stress!” Indeed, the suburbs is not the cultural dearth many city dwellers imagine it to be, so why would anyone stay in the city?
While I am unabashedly Brooklyn centric and fully believe that Brooklyn has become its own brand and destination, however there is no denying that Manhattan is still the anchor for NYC real estate. It’s the borough by which everyone else is compared. Some highlights on how it finished the year, as well as projections on how it will continue to perform:
– Inventory is still challenged. While inventory has grown by 20%, the growth is almost entirely attributable to condos. The number of co-op listings has remained flat since Q2 2011, and the market under $2M is severely under supplied.
– Contract signing is up 3% compared to last year. 58% of the contracts signed were for co-ops, since there ‘s limited choice in the affordable segment.
– High end sales have pushed up the average sales price to $1,303 p/sf an increase of 6% since Q4 last year.
While the added inventory in the market has buoyed average sales prices and general momentum, the affordable market (sub $2M) is still largely underserved. Product that comes in this price range move instantly and reports from brokers indicate well attended open houses.
Corcoran has just released their much awaited Q4 Market Report, and honestly I don’t think any of the trends here surprised anyone, highlights include:
- Strong demand but short supply. Brooklyn is experiencing a classic seller’s market in which there are not enough listed properties to feed demand from buyers. Thanks to the inventory shortage, transactions fell 4% versus Q4 13. At the same time, prices rose to their highest point in seven years; the price per square foot in Brooklyn is now $789, up 15% from the prior year .
- Fewer new developments. The number of new developments available in Brooklyn shrank, but their absence did not dampen enthusiasm for the borough nor the upward trend of prices.
- Dramatic price growth south and east of Prospect Park. Many areas held or modestly gained in value, but neighborhoods like Bedford-Stuyvesant, Bushwick, Crown Heights, Kensington, and Windsor Terrace enjoyed dramatic increases as buyers in search of affordable, quality properties competed for home purchases there.
My personal favorite is Bushwick. Which received a recent bump — and by bump I mean 1.5M views on Youtube, with SNL’s take on the rapidly changing neighborhood. Stay tuned for more as we do our own deep dive in these neighborhoods.
1. More Negotiability – while everyone has been hearing about the uber high end condos that have been coming online, One57 and its like, they only comprise 500 of 6,500 units expected (in Manhattan) this year. The vast majority of these units will be condos between $1,500 – $3,500 p/sf, which will give buyers a much needed sigh of relief. For comparison, this time last year there were only ~2,500 units that came to market.
The story plays out slightly differently in Brooklyn and Queens. While inventory is expected to rise in the boroughs, demand is still at feverish levels, pushing buyers further out east looking for affordability. This will also mean that the migration we’ve been seeing from Brooklyn to Queens will continue to strengthen.
2. Rent Rises – Hardly surprising to anyone, NYC will see an increase in rent. The trend seems to be everywhere, even with affordable housing efforts, rent is on the rise. NYC median rent was ~$2,840 in 2014 making it one of the most expensive cities to rent. Brooklyn particularly has become unaffordable, commanding more than 60% of median income for the borough. And the trends look like they will only continue.
3. An Entryway – 2014 saw the dominance of the “chef’s kitchen” or even a “cook’s” kitchen, in 2015 I expect to hear more about the welcoming spaces of the foyer / mudroom / entryway. More and more people are seeing their home as a place of solace and unwinding, and it can be an abrupt experience to enter directly into your living room, or kitchen from outside. While NYers are loathe to give up an inch of square footage , a bit off the corners for an entryway may be in order.
My earlier post on how to save for a down payment received a lot of questions. Notably people felt that they were already doing all the things I outlined but it STILL was not enough for them to gather a downpayment in this life time. So, what else can the first time home buyer do? They can use more aggressive saving techniques, which admittedly might be painful in the short term, but are well worth it in the long term.
First, become debt free. This means no student loans, and no credit card debt. This may seem insurmountable to some, esp. the student loans, but the longer you keep these loans the more interest you pay, and the worse off you are in the long run. I can empathize with the seemingly uncontrollable credit card debt, after college I charged one too many things, and before I knew it practically my entire paycheck was going to rent and the credit card. Eventually, I was avoiding my mailbox and creating a reality wherein the bills did not have to get paid. It’s possible to crawl out. But it means significant lifestyle changes. The faster you get rid of debt, the less interest you will pay, and you’ll be able to check your mailbox again.
Continuing from our earlier post which gave an overview of the general tactics of how to sell a home, I’m focussing this one on one of the most important aspects to selling a home, the photography. Perhaps second only to pricing — the photography of a property can make it or break it. Certainly, we can agree that the worst thing you can do for your property is not have any photographs. But once you’ve decided that you’re going to take photos, do professional photographs really matter? In my opinion the resounding answer is YES! And yet all too often I see DIY photos all over real estate listings. I’ve even reached out to a few listings myself and asked why they would post such unappealing photos, and the answer is usually a mix of , “the photos aren’t THAT bad, they’re just not professional”, “people aren’t idiots they can see what the place looks like without all the bells and whistles”, to straight up denial, ” these photos are just as good, I used a really good camera”. The truth is, if anyone can tell that these photos may have been taken by someone who may not earn a good living from photography, then the photos have failed.