Manhattan Real Estate

Prudential Douglas Elliman, the New York arm of the Prudential network, was named the number one firm out of the 1,940 offices of Prudential Real Estate Affiliates, at an awards ceremony yesterday. The firm’s 575 Madison Avenue office had the highest gross commission income, with the 1995 Broadway office taking the second spot and the 26 West 17th Street office in third place.

In a similar manner to local department and discount stores trying to move unsold inventory, Toll Brothers recently reduced prices by as much as 25 percent on its condominium units at Northside Piers, a luxury waterfront project in the Williamsburg section of Brooklyn.

A number of other condominium developments are holding back from publicly announcing that they are offering discounts for new units. According to real estate sources, if a buyer really wants to make a deal, he can negotiate price reductions for as much as 20 percent off the purchase price for condo units in some neighborhoods in Brooklyn. In Manhattan, the bidding and asking prices for sincere purchasers can range from 7 to 15 percent.

One thing is certain, local developers had hoped the stimulus proposal compromise between the House of Representatives and the Senate reached last Wednesday for a $15,000 tax credit for first-time homeowners would aid in the sale of condo units. On Thursday, the credit was scaled back to a more modest $8,000 — or 10 percent of the purchase price, whichever is less.

Under the stimulus package expected to be signed into law, first-time home buyers would receive an $8,000 tax credit if they purchase a home this year before November 30. This would be an actual tax credit and receipt of it is contingent upon the home buyer owning the property for at least three years. If the home is sold in less than three years, the tax credit must be repaid to the government.

There is an income cap for recipients of the full tax credit — under $75,000 income for individuals and less than $150,000 for couples who file their taxes jointly.

Unfortunately, the bonus won’t apply to many first-time homebuyers in Manhattan and trendy sections of Brooklyn and Queens because their incomes exceed the qualification level, and yet their incomes are not great enough to enable them to qualify for a mortgage.

By Michael Stoler – The Real Deal.com

Oct. 23 (Bloomberg) – Long Island house prices fell the most in at least four years in the third quarter as the national housing slump extended its grip on New York City’s suburbs.

The median price of a one- to three-family house dropped 6.9 percent to $427,388 from a year ago, New York-based appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate said today in a report. The median for all properties, including condominiums, dropped 6.2 percent to $415,000. The report excludes the Hamptons resort towns.

The threat of a recession and tight credit contributed to the decline in Nassau and Suffolk counties, Miller Samuel President Jonathan Miller said in an interview. Citigroup Inc. forecasts that the U.S. economy will contract every quarter next year, according to an Oct. 21 note to clients, and 75 percent of loan officers surveyed by the Federal Reserve in July said they had tightened home lending.

“The declines, within reason, are relatively equivalent across all markets of Long Island,” Miller said. “That essentially says that it’s external influence.”

In addition to the price drop, the number of sales for all types of residential property on Long Island declined 16 percent to 5,292.

Sales of previously owned homes probably will drop to 5.01 million in the U.S. this year, 29 percent less than 2005’s all- time high of 7.08 million, the National Association of Realtors said in a Sept. 9 forecast.

Manhattan Holds Up

Nationally, sales of previously owned homes fell more than forecast in August. Transactions dropped 2.2 percent to an annual rate of 4.91 million units from 5.02 million the prior month, the National Association of Realtors said Sept. 24. The median price declined 9.5 percent from August 2007.

While the suburbs are showing price declines, Manhattan has yet to see a drop in values. The median price of a condominium or co-op in Manhattan climbed 7.4 percent to $928,263 in the third quarter, according to Miller Samuel data released Oct. 3. Transactions fell 24 percent to 2,654.

Miller Samuel said today the median price of homes sold in the New York City borough of Queens dropped 11.4 percent to $400,000, while the number of sales fell 35 percent to 3,240.

To contact the reporter on this story: Sharon L. Lynch in New York at sllynch@bloomberg.net

Monday on “Your World w/Neil Cavuto” (Fox News, Oct 6, 2008) Donald Trump announced that he is not slowing down his real estate investing activity during our slumping economy. On the contrary, Trump made it clear there are good real estate opportunities to be had at “fire sale” prices that real estate investors should capture.

So how are you reacting to this financial chaos? Are you investing, or has this uncertain financial market got you frozen in your tracks? If you are frozen, you might be missing one of the best opportunities to invest in real estate that we’ve had in a long time. Consider this:

1. There are numerous “fire sale” deals available for real estate property throughout the United States
2. Interest rates are still generally favorable
3. Our economy will survive, so it’s just a matter of time before your investment in real estate is worth more than you pay for it by virtue of a greater demand for it

This is not the time to bury your money under a mattress. Yes, it’s comforting to be able to put your hands on it quickly, and perhaps like Donald Duck’s eccentric Uncle Scrooge, be able to roll around in it, but it will cost you big time. Inflation alone will devalue your money; your money won’t be worth as much next year as this year.

Here’s a better suggestion.

First, develop an investing plan. Then locate a real estate professional in your area that understands income-producing property and has a track record for investment property sales and build a relationship. Let him or her know what your investment objectives are and have them start looking for profitable investment opportunities.

If you know enough about the nuances of real estate investing and have a good understanding of your local real estate market, great. Then start kicking the bushes yourself.

The point is not to neglect doing something. This slumping financial market is unnerving, certainly, but our economy will survive and bounce back and what you invest into today will make you money tomorrow. If you have the financial means to invest in real estate without jeopardizing your welfare, then this is not the time to run for cover and hide. Instead, follow in the tracks of the Donald, during this slumping economy, look for, pursue, and seize investment opportunities with abandon.

“The China Center will be a gateway for Chinese corporations doing business in the U.S. or U.S. companies that want to understand the Chinese culture and do business there,” said Xue Ya, project director for the China Center.

The Freedom Tower, which will rise 1,776 feet, or 551 meters, when its antenna mast is included, is the first of four towers to be built at the site, which covers 16 acres, or 6.5 hectares. The federal and state governments have agreed to lease a total of one million square feet, or 92,900 square meters, although neither one has signed a formal lease yet.

“We’re working hard to get this tower built, and we’re also looking to attract world-class tenants to occupy it,” said Christopher Ward, the Port Authority’s chief executive. “This interest from Vantone will help us build excitement as we aggressively market this building to other prospective public- and private-sector tenants.”

The Partnership for New York City, a business policy and advocacy group, has long supported the creation of the 189,000-square-foot China Center and has agreed to invest up to $5 million in what will be a $90 million project.

“Establishing the China Center is probably the most important action we can take in support of our international trade relations for the city and the state,” said Kathryn Wylde, president of the partnership. “We see this as a way of assuring that New York City businesses develop a primary relationship with the emerging economy of China. This has been an area of competition with other world cities. We want to nail it down for New York.”

More than two years ago, Vantone announced its intention to lease space at the top of 7 World Trade Center, with the support of state and city officials. But the deal unraveled when Vantone was a few days late in posting a $45 million letter of credit.

In any event, Vantone moved on to 195 Broadway, New York, but backed out at the last minute. The company said that it had always wanted to move to the Freedom Tower, and that given the cost of the project, it was unwise to build a temporary home at 195 Broadway. Vantone’s annual rent will start at about $80 per square foot, about $30 more than what it had negotiated at 7 World Trade Center.