New York City Real Estate Newsletter
Q3 & Q4 2016
Buyer...be aware !
 
That elusive "time to buy" has arrived...and as always, before you know it, it will be gone.

Welcome Back....Fall is in the Green Room.

Summer is notoriously slow, and it proved to be just that; however, multitudes of deals are set to be 
consummated, as real buyers and sellers will finally meet in the middle.
 
PREDICTION
 
I predict the next 4-5 months will be the greatest buying opportunity we will see for years...note; that is a very small window of time.
 
In most cases the playing-field has leveled; right now, buyers have a vastly improved hand to play.
 
If you have considered buying over the past several years and/or you are considering to do so in the near future...NOW is likely the time.  The market has distinctly shifted for the first time in years. While pricing went through the roof and, in most cases, has since come crashing down, closing prices have still consistently built upon prior sales.  The pace of that growth though, has narrowed, evidenced by the increased "absorption rate" (the amount of time it takes for a property to sell).  Inventory has increased and buyers are in no hurry to make decisions. Conversely, sellers who have become quite accustomed to quick sales are growing increasingly impatient, and in some cases desperate.  The market value for property has re-calibrated and sellers, need to transact, are being forced to accept it.  As Hall F. Willkie said several months ago, "There is never a market for overpriced listings..."; this has never been more true.
 
Apart from December, we have just completed the slowest sector of the market cycle, July and August; so conditions seem extreme at this time.  Increasingly, press articles (see below) are dramatizing this activity, or lack thereof.  The actual takeaway should be that this is a very normalized marketplace, in which buyers and sellers are able to fairly transact.  In Manhattan, unless we are experiencing some global crisis, this particular "balance" is as good of an advantage as a buyer can expect.
 
This shift sets up an intriguing Fall buying season.  The Fall season is typically very short, just after Labor Day and lasting until around the second week of November, after which many buyers and sellers put-off plans until after the holidays.  Consider that 1) inventory is up, 2) prices are falling, 3) sellers are more open minded (as they have to be), 4) if sellers do not consummate a deal by November, they may very well have their properties well into next Spring, 5) the uncertainty of the election, meaning policy uncertainty...AND 6) while the Fed is fixed on raising rates (which is an eventuality), interest rates are still at virtual all-time lows.  This is a "Murder's Row" of offensive fire power that buyers have not had in years!
 
In my 18 years, I have seen far fewer cycles whereby buyers had the upper-hand.  When such circumstances have materialized, they ended abruptly.  I have seen this happen several times and I predict it to happen again.  Those who tried to time the market missed it; they blinked and that window closed.  This time, I predict it will be late January through March of 2017, just 4-5 very short months from now.
 
Late-January to March is notoriously the busiest time of the year; it has historically been driven by Wall Street bonuses.  Come November, Wall Streeters (your biggest market competitors) are already considering what their bonuses might be in January; this causes them to wait out the holidays.  Once those bonuses are revealed (after the New Year), the wait is over and the year-long question of their compensation is answered.  This revelation, whether good, bad or moderate, jump-starts the market activity and hence the competition for good property.  Open houses become very well attended and offers begin to fly around.  Those who lose out in bidding wars become increasingly aggressive with every offer and the frenzy becomes palatable.  Once we reach that point, we'll know that this past Fall's opportunity-window will have closed. AND we'll have a new President...Hmmm.
 
"...man about TOWN

(click on the photo above to view my promotional video)  
 
*    Recognized by New York Magazine &
      Five Star Professional as one of the "most accomplished
      real estate professionals in New York City."


*    Ranked nationally by REAL Trends as one of "America's Best
      Real Estate Agents" for avg. sales price of $4.350M.

*    Sold a single family Townhouse faster than any other on the
      Upper West Side over $10M to date. (StreetEasy)  

*    Trivia: Won the 2015 New York Times NCAA Basketball Pool.

Your best investment is often in the broker you choose. With Manhattan's palpable level of competitiveness, my clients have considered me their hidden-hand. My 18 years of experience afford me the expertise to pull back the curtain and reveal the circumstances as they are and the possibilities that exist.
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In This Issue






Featured Exclusive :        36 Gramercy Park East, #4S
 
36 Gramercy Park East is your Key to "The Park"...
 

Nestled in one of New York's most picturesque and celebrated historic landmarks is 36 Gramercy Park East, Residence 4S. Built in 1909 as an exquisite example of classic Gothic architecture, 36 Gramercy Park East was recently honored, along with St. Patrick's Cathedral, with the 2016 Lucy G. Moses Award for excellence in historic preservation - the New York Landmarks Conservancy's highest honor for outstanding preservation. This extraordinary three-bedroom, three-and-a-half-bathroom home features lavish spaces, stunning details and enviable views. Not to be overlooked, it also offers a coveted key to Gramercy Park. For a full description  and to view more photos  click here.  $6,495,000
Market News
Manhattan's Luxury Real Estate Slowdown Is Spreading to Other Price Tiers
by  Julie Verhage

"The luxury market was the first price segment where we began to see slowing price growth, and now we're seeing other price segments following suit."  - Krishna Rao, StreetEasy's economist

There are more signs of a slowdown in New York City real estate.

According to new data from listings website StreetEasy.com, the luxury market still has some adjusting to do with price cuts now spreading from just the most expensive apartments to other price tiers.

"Most of the increase in price cuts for the luxury tier is in the smaller price cuts bucket (5 percent)," said Krishna Rao, StreetEasy's economist. "While sellers aren't going for aspirational prices, they haven't fully adjusted to reality at the top end of the market."

The chart below shows the percentage of sales that have seen price cuts for the top 20 percent of Manhattan's real estate market, in terms of the listing price. There's been an increase of late in the percentage of listings that have seen price cuts of up to 5 percent or up to 10 perce nt. Read more.

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       Manhattan Apartment 
Sales Sputter

Second-quarter figures show cooling extends beyond luxury market; brokers cite high prices       By  Josh Barbanel 
  
Manhattan apartment sales are tumbling, according to new market data, and several brokers said it is a sign that a significant correction is underway as buyers hold back.

Sales in the second quarter were down more than 10% compared with the same quarter in 2015, the slowest pace since the recession year of 2009. Sales of co-ops fell by 26% and sales of lower priced apartments going for less than $1 million were down 20%, according an analysis of city records by The Wall Street Journal.

"I think it is a correction, a serious correction," said Hall F. Willkie, president of brokerage Brown Harris Stevens.

The slowdown, which began in the second half of last year among high-price apartments, deepened and widened this year. Many brokers said asking prices were set too high after a run-up in prices a few years ago. Brokers also cited volatility earlier this year in financial markets, which can weigh on wealthy buyers' decisions.

"The luxury market has been choking on quite a bit of overpriced inventory," said brokerDonna Olshan. "Fantasy and aspirational pricing just doesn't cut it."   Read more .
 
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The Real Deal: Is it now officially a buyer's market?
                                                          by Anne Machalinski  
 
 
It's essential for real estate agents to understand the current marketplace so they can get the best deal for their clients. And after years of watching the market favor sellers, many agents say they've seen a recent shift that has affected luxury property sales across the globe: We've entered a buyer's market.

Jed Garfield, president of Leslie J. Garfield & Co., a New York-based brokerage that focuses on townhouses, said he saw signs of this trend in late 2015, when properties that were listed at a fair market price didn't sell. But recently, the impact has been dramatic. For example, a townhouse on East 70th Street between Park and Lexington avenues that was bought for $31 million in 2013, re-listed for $32.5 million a year and a half ago-and then dropped down to $22 million three months ago. Read more.



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Why New York Luxury Real Estate 
Has  Had a Bad  Year
                                     by Jean Folger  

The New York luxury  real estate market is faltering, according to a recent report from Douglas Elliman Real Estate and Miller Samuel, a real estate appraisal and consulting firm. In the Hamptons, for example - summer retreat of wealthy New Yorkers and home to some of the priciest real estate in the country - the number of real estate transactions plummeted 21%, from 706 in the second quarter of 2015 to just 561 in the same quarter this year. During the same period, the  average sale price dropped 0.3% to $1.68 million. And looking at 2016 alone, the average sale price fell 11% from the first to second quarters of the year.

Although the broader real estate market across the country is showing strength, wealthy buyers have been slow to enter the luxury market. Here's why New York luxury real estate has had a bad year so far. Read more.

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 New buildings planned or built on 5th Street.  Image coutesy: New York Times.

New York City's Billionaires' Row is Dead
by Business Insider

Who would want to pay tens of millions to live in a full-floor apartment hundreds of feet above the city within a super-tall, ultra-svelte building?
The answer, it seems, is fewer people than developers had hoped.
With a cooling market, units left unsold, and developers being forced to slash prices, it seems the golden age of New York City real estate is over, a recent  report in The New York Times warns.
Nowhere is this more obvious than on what was only recently christened "Billionaire's Row." This area around 57th Street in Midtown Manhattan was so named for its cluster of extremely tall apartment buildings ostensibly catering to the elite with 360-degree Manhattan views and top-notch finishes.
Construction was booming just two years ago, but there now seem to be more high-end apartments available than there are interested buyers.
On Billionaire's Row, "it's not just slow - it's come to a complete halt," Dolly Lenz, a real-estate broker catering to super-rich individuals,  told The Times.   Read more .
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US hedge fund Marathon makes 
Brexit bet on European property 
by Mary Childs
 
Marathon, a $13bn US hedge fund, is building a big  Brexit trade, increasing its investments in property across Ireland, France, Germany and the Netherlands, in a bet that they will be among the big beneficiaries from companies leaving London in the next few years.
These countries "have the most stable outlook and [are the] most likely to benefit from Brexit," said Bruce Richards, co-founder and chief executive of the distressed debt and property specialist.
 
Hedge funds were reluctant to put on trades ahead of Britain's referendum on EU membership in late June given the closeness of the polls. With the volatility triggered by the vote long since vanished, hedge fund managers such as Marathon, and private equity firms such as  CVC, have been preparing for any opportunities created by the UK's decision to leave.
Marathon, which acquired a cluster of European real estate this year, including a portfolio of commercial properties in the Netherlands from Credit Suisse, is planning to buy more in France, Germany, the Netherlands and Ireland.
"Many bank service sector jobs will undoubtedly move to Frankfurt and Paris as EU rules will likely require bank employees to be domiciled within the EU when serving EU clients," Mr Richards said. Read more.
Mortgages & Interest Rates

Fed rate hike odds increase
 
Futures implied probability of a Federal Reserve rate hike in September are at 42 percent this morning, and have risen to 2-to-1 for an increase by the end of the year following Chair  Janet Yellen's speech  at Jackson Hole on Friday. The dollar rose to a two-week high , with the Bloomberg Dollar Spot Index gaining 0.1 percent by 5:47 a.m. in New York. While Yellen's speech was hawkish enough for Goldman Sachs Group Inc. to boost rate hike odds for September, Pacific Investment Management Co. said her speech included  nothing of note . One thing is certain: investors will now turn to  August jobs data on Friday  for the next indication of the likelihood of a change at the Fed. 

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Sources: Bloomberg          
Market Reports & Resources
Market Report Sales:  The Aggregate: 2nd Quarter 2016  click here.
 
Leasing Report for May 2016:   click here    
 
Seller's Guide:   click here

Buyer's Guide: click here
 
Rental Guide:   click here
NYC Food for the Foodie


Robert Rosenthal

The Food Humorist©, is a Manhattan born man-about-town who writes, produces and hosts programs about food. Some can be fo und here - Modern Food Man.

Robert Rosenthal earned a professional culinary degree while president of a top international ad agency. He performed stand-up in New York's hottest comedy clubs, hosted his own food shows on TV and radio and also writes for the Huffington Post, The Daily Beast and Advertising Age, which calls him "undoubtedly one of the industry's most colorful characters." As personal chef to his wife and kids, his handiwork can also be found at Short Order Dad.

Any questions for Rob? Ask away .
 
Rob's book which I HIGHLY recommend for a Dad like myself.
There is a new kind of dad, and he's doing far more domestic duty than at any
 time in history, including cooking. Although it's written with a sense of humor, this book is a serious resource for dads and anyone else interested in upping their game to make great tasting food at home, even if they have never used a chef's knife or a roasting pan before.  Order here

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FALL PREVIEW GUIDE  by  
 
Ready to have your most delicious season ever?

Check out the rest of our Fall Preview to get dialed in to the best restaurants, cookbooks and more.

New York's restaurant scene has taken some flack lately ( even from us), but this fall, a massive batch of restaurants is poised to open from proven chefs and restaurateurs in unconventional neighborhoods: We're talking an April Bloomfield steakhouse on the Upper West Side and a Tom Colicchio restaurant in FiDi. And a wave of Japanese restaurants that's been waiting to crest on New York's shores will finally start its arrival with the opening of ramen cult favorite Ichiran and an outpost of udon specialists TsuruTonTan.

Meanwhile, one of the city's most beloved restaurants, Union Square Cafe, will return to us all, just a few blocks away from its original home-with a newly added side project we're excited about.

Hope you're hungry for fall. Here's what's on the menu.

 
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and now for that infamous phrase...

"It's the Best in the City..."    
P i z z a !  

 

Graffiti:

 
 

 
  
Concierge:  Luxury Attaché
At Town you will receive access to our own on-site Concierge, powered by Luxury Attaché . They are the premiere lifestyle management company offering day-to-day assistance and solutions to our clients. They routinely advise on the most cutting-edge cultural experiences, including but not limited to: securing reservations at coveted restaurants and nightlife venues, planning client entertainment outings, coordinating on- and off-site events, assisting with gift purchasing, and planning international travel. True luxury is about having both time and convenience - both of which are achieved through our partnership with Luxury Attaché.
Contact Information:
Roberto Cabrera Licensed Associate Real Estate Broker
 
TOWN
110 Fifth Avenue, 6th FL
New York, NY 10011
P: 646.998.7445
F: 646.738.7496

Disclaimer: What is contained here is not meant or construed to be the opinion, common practice or policies of any residential real estate firm. This is simply what I've experienced to be common practice within the residential real estate market in Manhattan over the past sixteen years. This is meant to be informative, enlightening and hopefully enjoyable.