What are the main differences between a NYC co-op and condo part 1?

This is the first in a 3 part series of the differences between Manhattan co-ops and condos. 

There are many differences between a Manhattan co-op and condominium and in this first installment we will explore 2 of them.

1- Co-ops can turn down the application of a prospective purchaser without any reason given and that’s it, the buyer can not complete the purchase.  Any fees or costs incurred are not reimbursed and that’s it. A condo grants a waiver of the right of first refusal when they take an application from a prospective purchaser. The only time that they may exercise the right of first refusal is when an apartment is being sold far below market. Instead of letting the sale go forward, they can purchase the apartment.

2- Co-ops more closely scrutinize the financial wherewithal of prospective buyers than condos. So you need to have a down payment of 20-25% plus a debt to income ratio of no more than 28% plus stable job history, and excellent credit. A condo may run credit but they are satisfied with you obtaining a loan commitment or purchasing cash. They are not going to turn you down because you do not make enough money.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every Manhattan market from Battery Park City to Washington Heights.

West 110th street subway station to open this Saturday

After 5 months of being closed for repairs and improvements, on Saturday southbound service will begin again and on Tuesday northbound service will resume. The MTA announced that the project was completed on time and on budget. The station had closed April 9th.

Curbed coverage

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

 

 

Most expensive zip code for renters in US is…Battery Park City

The most expensive zip code in the US for renters according to a recent report by RentCafe is Battery Park City, 10280. The average rent is just over $5657 according to the report. This is down from the previous year’s average of $6,000. 26 of the 50 most expensive zip codes in the US for renters were in Manhattan. Three of the top 12 most expensive zip codes were on Manhattan’s Upper West side.

Soho/TriBeca was the area that experienced the largest increase in rent year over year. 10013’s average rent was up over 10%.

Coverage from 6sqft

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

24 Luxury contracts signed last week in Manhattan

Last week, 24 contracts for $4 million and up were signed. This was an increase from 15 contracts signed for the same week, last year. The most expensive contract was a co-op at the Pierre at 795 Fifth avenue which had an asking price of $22.5 million.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

Jennifer Lopez and ARod have an apt on Upper west side

According to Architectural Digest, Alex Rodriguez and Jennifer Lopez have been renting an upper west side apartment in 15 Central Park west, the limestone condo near Lincoln Center on Manhattan’s upper west side. Apparently, the lease will be up and the apartment,  will be for rent for $11,500 come September 1.  The apartment is 1,079 sqft with a 111 sqft private terrace.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

Hudson Yards effect on nearby condo and rental buildings

As Hudson Yards continues it’s march towards completion in 2025 and many amenities are open or near open including the Culture Shed, and the Vessel, the development is effecting nearby development.

According to Real Estate Weekly, brokers in nearby developments- both rental and sale are seeing increases in activity. These new developments include 515 West 29th street aka Five One Five, a boutique condo building with 3 listings on streeteasy starting at $4.375 mm for an 1895 sqft(172m2) 2bd/3ba. Also listed on the same block is 550 West 29th street which features a 3290 sqft(306m2) penthouse with a huge outdoor space  in a 19 unit boutique building.

Neaby rental buildings are also seeing increased activity due to the influx of new commercial tenants to Hudson Yards. According to brokers representing those luxury rentals, some do not want to live exactly where they work but with a 5-10 minute walk and as a result are choosing nearby Hell’s Kitchen developments like Sky and The Oskar.

Mets pitcher Noah Syndergaard rents in Sky

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

 

50 Riverside boulevard aka One Riverside Park availability

The Extell Development building built in 2015, with a 20 year tax abatement, and 50,000 sqft of amenities currently has 9 units for sale. They are all resales, averaging approximately 10-20% more than their sold prices in 2015. The averge price per square foot is $1,878 per square foot. The average days on the market is 181 and if you remove one listing that has been for sale for 451 days, it goes down to 150 days on market.

There have been 4 sales this year and none in the last 3 months. That’s an average of 1 sale every 2 months which means the inventory would last about 18 more months.

The two resales sold this year were sold for a 100,000 or 6% profit and a $1.2 million loss, suggesting the building is roughly valued very close to the 2015 levels or less in the case of the larger apartments purchased from the sponsor.

Given that there are many more years left in this tax abatement, this might be the right time to get into this building with it’s amenity suite including the La Palestra athletic club, bowling alley and lounge, rock climbing wall and 75 foot lap pool.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

Thinking of buying a Manhattan luxury property for investment?

This is 3rd part of the series focusing on the purchase of Manhattan properties for investment. In this part, we take a look at the luxury market and it’s opportunities.

According to the latest study from streeteasy.com 2018 is the year of the discount for luxury property, roughly defined as $4mm and up by the study. 59% of the properties that closed were discounted and median discount was $980,000. This is up from 36% of the properties in 2016 and also up from 2017’s number of 54%.

One way to take advantage of the Manhattan luxury market is to buy and hold the property. Right now, the luxury market is in the 3rd year of buyer’s market. Less product is coming on the market, and land sales have slowed. Once this inventory is absorbed, then we will again see a shortage of inventory in the luxury market and the prices will rise again.

Also, luxury rentals will be more and more in demand. Take for example 1 Hudson Yards. It is a building with luxury amenities, liklap pool, salt water pool for children, cold plunge pool plus a bowling alley and lounge with kitchen, penthouse party room, and tons of outdoor space. In addition, there is an gym similar to an Equinox, a basketball court, and plenty of outdoor grills for barbecuing. In a neighborhood that is developing with construction everywhere, take a guess how many rentals are available in this 178 unit building. Zero! All rented. 1 bedrooms were $4800, 2 bedrooms $9,000 + and 3 bedrooms $15k and up. The rental market also for the last 2 years, has been oversupplied and this will change in the next 1-2 years. In 20 years of real estate brokerage, I have seen several cycles.

Take an apartment in Waterline square as an example. A 3bd/3ba in 1 Waterline Square aka 10 Riverside boulevard is asking just over $5 million. Due to the tax abatement, the monthlies for this 1824 sqft (169.4m2) apartment is $3,642 including the taxes.  A 3 bedroom/3bath of about the same size rented for $14,000 in 50 Riverside boulevard back in June of this year. Let’s do the numbers on this purchase assuming an asking price purchase.

$5,000,000 purchase
$14,000 rent monthly
$3,642 monthly charges
$10,358 net or $124,296 annually
2.5% return 

The 2.5% return does not take into account the market price of this apartment in the future as well as tax benefits such as depreciation. Let’s say in 5 years, the apartment is worth $6 million. Your rate of return then would be 5.6%.

Additionally, the monthly net income could support approximately $2 million in mortgage which could lower your necessary cash outlay to $3 million from $5 million. This would raise your rate of return in 5 years to 15%!

The luxury market is full of these type of deals where you can take advantage of the slowdown in demand and get in on the market before the market turns up again. If you understand that the tech and finance sectors are not going anywhere and also understand that Millenials might find it harder to purchase and many may decide to rent luxury instead of buying then you can take advantage of the opportunity that not everyone sees.

 

Part 1 of the Manhattan investment buying series

Mansion Global coverage

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

 

Where foreign investors are buying in Manhattan

According to CNBC, foreign investors are choosing New York City as the number two place to make their real estate investments behind only London. Certain neighborhoods seem to be attracted the most interest. The Upper West side was mentioned as attracting Chinese buyers in the $1 to $2 million range according to one real estate broker. Harlem was not mentioned but Brownstone Brooklyn was mentioned.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

 

Average 1 bedroom rental in Harlem just under $2,000

The average rental price for a 1 bedroom apartment in Harlem above 125th street is $1994 per month according to a study of rental listings. The average price for a studio is $1784 and the average days on the market is 22 day for active listings.

In the last couple of years the rental market has been in a down cycle but likely this will be coming to an end in the next year as excess inventory is absorbed and a new cycle of increases begins.

The Author-  Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every neighborhood from Battery Park City to Washington Heights.

News about the NYC real estate residential and commercial markets provided and interpreted by an industry veteran licensed since 1999. Brian Silvestry of BSRG Inc. Licensed real estate broker