NYC Planning Commission Pushing For More High Rises; Increase Density in Transit Rich Neighborhoods

The Real Estate Board of New York hosted their annual event honoring commercial property management achievements and pros. One of the speakers at the event was Marisa Lago who is the City Planning Commission. In her speech, she addressed what is ahead for the City with respect to housing and what the Commission has been prioritizing.

According to Lago, New York is has a population of 8.5 million people and 4.5 million jobs. She indicated that between 2010 and 2017, NYC added 600,000 jobs. With this boom in employment there are challenges that the Commission would like to address.

Her biggest concern is to build more affordable housing. In particular they are prioritizing "as of right" developments. As of right developments are ones that comply with all applicable zoning codes. They do not require special public hearings, permits, variances or discretionary action by the City Planning Commission or Board of Standards and Appeals. Lago stated
“Since 2010 over 80% of new housing in the city has been built as-of-right. Without this development about 300,000 New Yorkers, an entire city of Pittsburgh, wouldn’t have the homes that they live in today.”

The second priority would be to increase residential density in transit-rich neighborhoods. Lago states that the Commission has been encouraging mixed-used neighborhoods in a focused way for the past two decades.

According to Globest, Lago pointed out in 2017, only 18 buildings 40 stories or higher were constructed. They accounted for only 1% of new residential buildings completed. But they accounted for 22% of new housing units. Creating more high rises would certainly bring more affordable housing in transit rich areas.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

REIT Markets Finding It's "Mojo" in Second Quarter After Historic First Quarter Selloffs

Globest.com is reporting that REIT equity shares increased 11.1% in the second quarter of 2018 after suffering historic selloffs in the first quarter that lent to a 10% decline in value for the period.  The report also indicates that shares increased another 3.6% in August as the sector is finding it's "mojo" according to Kroll Bond Rating Agency (KBRA).  The report covered 116 REITs that placed unsecured debt, including 66 REITs that issued notes in the public market, 28 REITs that issued unsecured notes but only via private placements and 22 REITs that borrowed via unsecured term loans but not unsecured notes.

According to KBRA  debt-to-market leverage for the REIT sector reached record lows by mid-year 2018, declining to a median of 30.2% for public and private note issuers. REITS have recovered all of their first quarter losses and are now high year-to-date as compared to the same period year over year.  Retail department stores as well as malls and shopping centers rebounded for the quarter.  Retail department stores are considered one of the strongest equity market groups.

Overall KBRA is confident in the overall REIT market stating “If REITS aren’t in the sweet spot for capital raising and allocation, they’re not far from it. Favorable borrowing costs and more agreeable equity valuations have become aligned with robust demand for properties and the backdrop of consistent economic and employment growth. The menu of REIT capital raising options has rarely, if ever, been broader.”

Other findings from the report according to the Globest.com article are the following:

• Alignment of shareholder and creditor interests is evident in the REIT sector, where lower-leverage REITs have substantially outperformed in the equity market, engendering a greater willingness to raise equity, expand portfolios and enhance diversification.
•  Lower borrowing costs for REIT unsecured debt than mortgage loans further align shareholder and bondholder interests, with unsecured borrowers prompted to avoid and retire mortgage debt.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/reit-markets-finding-its-mojo-in-second-quarter-after-historic-first-quarter-selloffs/

NYC Broker Confidence Declines Entering Into The Slower Fall Season

The Real Estate Board of New York (REBNY) published their broker confidence index for the 2nd quarter of the year and it shows a decline from first quarter results.  REBNY which surveys its residential and commercial brokerage division members to measure their confidence in the New York City real estate market publishes their results quarterly with the top index being a 10.  The index shows that broker confidence decreased in the second quarter of 2018 to 5.53 out of 10.  This is a decrease of 0.25 from the first quarter of 2018.  Residential broker confidence levels hit a record low of  of 4.63 in the second quarter of 2018.

The report indicates that the main factors for the decreasing optimism with broker circles are political uncertainty, the expectation of rising interest rates, how the tariffs will affect investments, concerns about the implications of tax reform.  John Banks, President of the REBNY states "As federal policies have taken effect, local real estate markets have been seeing their impact on buyer hesitancy and seller uncertainty.  Despite these conditions, New York City real estate brokers remain positive overall about the present situation and future real estate market."

Some brokers believe that pricing and the lack of housing remains a major concern in the residential market.  One broker states "The biggest issue is still pricing, but a close second place is condition of the apartment," said a residential broker. "Buyers are slower to purchase an apartment that needs a good deal of work."  All of these concerns are affecting future confidence in the market as well.  The Residential Broker Future Confidence Index  which is an outlook on the future market six months from the date the survey was completed hit a number of 4.46.  This is 1.18 decrease from the first quarter of 2018.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nyc-broker-confidence-declines-entering-into-the-slower-fall-season/

Existing-Home Sales Drops For Fourth Straight Month, Drops Significantly in the Northeast

The National Association of Realtors (NAR) released their existing-home sales report for July and for the fourth consecutive month sales have been down.  The report indicated that existing-home sales are moving at the slowest pace in the last two year.  The Northeast had a significant drop in existing-home sales as affordability and inventory issues continue to plague the industry.

Total existing-home sales which are completed transactions that include single-family homes, townhomes, condominiums and co-ops fell 0.7% to an annual rate of 5.34 million for July.  The adjusted projected rate has declined from 5.38 million in June. Chief economist for the NAR Lawrence Yun stated  “Led by a notable decrease in closings in the Northeast, existing home sales trailed off again last month, sliding to their slowest pace since February 2016 at 5.21 million.  Too many would-be buyers are either being priced out, or are deciding to postpone their search until more homes in their price range come onto the market.”

Median prices for existing-homes increased for the 77th consecutive month.  The median price jumped to $269,600 which increased 4.5% from July 2017.  Total housing inventory decreased to .5% to 1.92 million which is unchanged from the amount available at the same time last year.

On a regional level the Northeast saw the biggest drop in existing home sales for the month.  Sales dropped 8.3% to an annual rate of 660,000.  The median price for an existing home in the Northeast was $309,700.  This is an increase of 6.8 percent from the same time last year.  The Midwest saw sales decline 1.6% to a rate of 1.25 million in July.   The median prices in the Midwest was up 2.5% from 2017 to $210,500.  In the South, sales decreased 0.4% to a rate of 2.24 million in July. The median price in the South was up 2.7% to a price of $233,400.  The West was the only region to see an increase of 4.4%  to a rate of 1.19 million in July. Median prices in the West increased 5.1% to $392,700 from July 2017.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/existing-home-sales-drops-for-fourth-straight-month-drops-significantly-in-the-northeast/

Existing-Home Sales Gain In The Northeast As Trend Nationwide Continues to Decline

The National Association of Realtors (NAR) released their existing-home sales report for June.  The report indicates that existing-home sales decreased for the third straight month in June.  Although there were sales gains in both the Northeast and Midwest, lagging sales in the West and South resulted in overall decrease in existing-home sales by 0.6%.

Existing-home sales which is defined by the NAR as completed transactions which includes single-family homes, townhomes, condominiums and co-ops decreased to an adjusted annual rate of 5.38 million in June from revised 5.41 million in May. Sales are now down 2.2% overall year over year.

One of the major factors that has been hurting the market is the ongoing dearth supply of available homes in relation to demand.   Lawrence Yun, chief economist for NAR stated  “There continues to be a mismatch since the spring between the growing level of homebuyer demand in most of the country in relation to the actual pace of home sales, which are declining.  The root cause is without a doubt the severe housing shortage that is not releasing its grip on the nation’s housing market. What is for sale in most areas is going under contract very fast and in many cases, has multiple offers. This dynamic is keeping home price growth elevated, pricing out would-be buyers and ultimately slowing sales.”

Median sales prices once again hit an all-time high June at $276,900.  This amount is an increase from June 2017 of 5.2% ($263,300).  This is the 76th straight month of an increase of existing-home sales prices.  Housing inventory increased 4.3% to 1.95 million existing homes available which is 0.5 percent above a year ago.  Yun warned that despite this increase in inventory, the demand any growth.  Yun states  “It’s important to note that despite the modest year-over-year rise in inventory, the current level is far from what’s needed to satisfy demand levels.  Furthermore, it remains to be seen if this modest increase will stick, given the fact that the robust economy is bringing more interested buyers into the market, and new home construction is failing to keep up.”

Regionally, here in the Northeast we saw a moderate gain.  Existing-home sales increased 5.9% to an annual rate of 720,000.  The median price in the Northeast was $305,900.  This is up 3.3% from June 2017.  The Midwest saw gains of 0.8% while the West -2.6% and South -2.2% saw declines.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/existing-home-sales-gain-in-the-northeast-as-trend-nationwide-continues-to-decline/

Northeast Existing-Home Sales Increase Despite Nationwide Downward Projection

The National Association of Realtors (NAR) released their report on existing-home sales for the month of May and it shows that the national trend of sales in the sector is trending downward for the second consecutive month.  All markets show a drop off with the exception of the Northeast which saw a 4.6% increase.  The numbers come as no surprise as inventory as well as increase mortgage rates are hurting the industry.

According to the report, which is considered completed transactions including single-family homes, townhomes, condominiums and co-ops, decreased 0.4% to a seasonally adjusted annual rate of 5.43 million for May. Sales are now down 3.0% from 2017.

Chief economist for the NAR Lawrence Yun stated “Closings were down in a majority of the country last month and declined on an annual basis in each major region. Incredibly low supply continues to be the primary impediment to more sales, but there’s no question the combination of higher prices and mortgage rates are pinching the budgets of prospective buyers, and ultimately keeping some from reaching the market.” Despite seeing almost historic levels of decreased inventory there was an increase this month.  Housing inventory jumped in May 2.8% to 1.85 million existing homes available for sale.  It is worth noting that this is 6.1% lower year over year.

The Northeast was the only region that saw an increase in existing-home sales.  In May, sales increased 4.6% to an annual rate of 680,000.  This amount is still 11.7% below the same time in 2017.  The Midwest saw the most drastic decline in 2.3% followed by the West at 0.8% and the South at 0.4%.

Also of note, median existing-home price for all housing types hit an all time high in May at $264,800.  This is up 4.9% from May 2017 ($252,500) and the 75th straight month of increases.  Mortgage rates also increase for a 7th consecutive month to 4.59%.  The increase in both sales prices and mortgages rates are hampering first-time home buyers in entering into the market according to Yun.  “The abrupt hike in mortgage rates this spring, along with price appreciation and competition being the strongest in the entry-level part of the market, is why first-time buyers are not as active as they should be and their participation remains below its historical average.”

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/northeast-existing-home-sales-increase-despite-nationwide-downward-projection/

Market Survey Shows That New York City Construction Costs Remain The Highest Worldwide

Turner & Townsend, a multi-national company famous for their project management and program management consultancy work released their annual International Construction Market Survey.  According to the company,  the survey collects information from 46 international markets to determine to global state and direction of the market.  The survey indicates that New York City leads the world in construction costs for the second year in a row in the Turner & Townsend survey.
The five most expensive locations are New York City, San Francisco, Hong Kong, Zurich, and London. The survey looked at 6 different types of buildings in order to assess total building costs. 

The buildings that were taken into consideration were the following:

High-rise apartments
Office block prestige (Commercial office space)
Large warehouse distribution centers
General hospitals
Primary and secondary schools
Shopping centers including malls

Overall construction costs in New York City decreased 12 percent in 2017 and expenditures were measured at $45.3 billion.  This is the second highest on record after 2016. They are forecasting expenditures to hit $52.5 billion in 2018 citing recent tax cuts as an incentive for driving businesses back to the United State and specifically New York City.

Future developments will revolve around government fund and non-residential construction.  "Non-residential and government-funded construction will drive much of the growth in 2018 and 2019. Government expenditure is expected to reach USD16bn, with half spent in New York City.  New York is currently experiencing massive redevelopment.  The biggest project is the USD20bn Hudson Yards, which includes 18 million sq ft of commercial and residential space. The Long Island Express, a USD10bn transport project, includes a station under Grand Central. Meanwhile, La Guardia airport is adding a new USD8bn terminal. Employment in construction is at record levels with skilled trades in short supply."  The report indicates that the overall forecast looks bright driven by positive economic growth.  Construction costs will remain high as there is a shortage of skilled labor in NYC. 
The outlook nationwide looks rosy as well as construction costs hit an all-time high of $1.3 trillion last year.  Skills shortage and material costs continue to plague the industry.
On the salary side, New York City was second behind Zurich Switzerland where the average wage was $98.30 per hour in comparison to Zurich's $104 per hour.  The report did indicate that only high union wages were taken into consideration and did not include private sector rates.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/market-survey-shows-that-new-york-city-construction-costs-remain-the-highest-worldwide/

Pending Home Sales Drop In April Amid The Ongoing Housing Shortage

The National Association of Realtors (NAR) is reporting that pending home sales for April decreased for the first time in three months.  NAR used a Pending home sales index which saw their reading drop to 106.4 for April.  The drop was 1.3% from March which saw the index level at 107.8.  Pending home sales have been adversely affected the the shortage of available housing available as the levels of housing is considered "dire" at this point.

Pending Home Sales Index is an indicator based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing according to NAR.
Lawrence Yun, chief economist doesn't see a change in sight unless more new and existing home sales hit the market.  The market is being affected by higher mortgage rates, increase home sales prices  and increased gas prices will affect the market ahead.  He states

“Pending sales slipped in April and continued to stay within the same narrow range with little signs of breaking out. Feedback from Realtors, as well as the underlying sales data, reveal that the demand for buying a home is very robust. Listings are typically going under contract in under a month, and instances of multiple offers are increasingly common and pushing prices higher. The unfortunate reality for many home shoppers is that reaching the market will remain challenging if supply stays at these dire levels.”

“The combination of paying extra at the pump, while also needing to save more for a down payment because of higher rates and home prices, may weigh on the psyche of those looking to buy.  For now, the economy is very healthy, job growth is holding steady and wages are slowly rising. However, it all comes down to overall supply. If more new and existing homes are listed for sale, it would allow home prices to moderate enough to stave off inflationary pressures and higher rates.”

It should be noted that although the inventory shortage, Yun still predicts an increase of existing home sales of .5 percent to 5.54 million.  Also of note in our region, the index indicates no change in the pending home sales index as it remained at 90.6.  This is 2.1 percent the same period last year.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/pending-home-sales-drop-in-april-amid-the-ongoing-housing-shortage/

Existing-Home Sales Increase For Second Consecutive Month Bolstered By Strong Activity In The Northeast

The National Association of Realtors (NAR) has released their existing-home sales report for March.  The report indicates that existing-home sales grew 1.1% and was assisted by increased sales activity in the Northeast and higher total inventory.  Despite overall existing-home sales increasing, the market in still being hampered by overall affordability issues and inventory being low despite and increase in new houses hitting the market.  The figures indicate that overall demand remains high as purchasers have to pay a premium for the low level of existing homes.

Existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops increased to an adjusted annual rate of 5.60 million in March.  This is an increase from 5.54 million in February. The report indicates that sales are still 1.2% below from the same time a year ago.  The median existing home prices increased for the 73rd consecutive month to $250,400 and is 5.8% higher than a year ago ($236,600).   Total inventory of existing-home increased increased 5.7% for March to 1.67 million existing homes.  This is still significantly lower than a year ago when 1.8 million existing-homes were available.

Existing-home sales regionally increased in the Northeast and Midwest.  The Northeast saw an increase of 6.3% to a adjusted rate of 680,000.  Median prices also increased by 3.3% to 270,600.  The Midwest saw an increase of 5.7% to an annual rate of 1.29 million in March with median sales prices increasing 5.1% to $192,200.  The West region saw an increase of sales price of 7.9% to $377,100.  Inventory in the region was down 3.1%.

Lawrence Yun, chief economist for NAR said the following:

"Robust gains last month in the Northeast and Midwest – a reversal from the weather-impacted declines seen in February – helped overall sales activity rise to its strongest pace since last November at 5.72 million.  The unwelcoming news is that while the healthy economy is generating sustained interest in buying a home this spring, sales are lagging year ago levels because supply is woefully low and home prices keep climbing above what some would-be buyers can afford.  Although the strong job market and recent tax cuts are boosting the incomes of many households, speedy price growth is squeezing overall affordability in several markets – especially those out West."

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/existing-home-sales-increase-for-second-consecutive-month-bolstered-by-strong-activity-in-the-northeast/

Queens County Is Seeing A Housing Boom Increasing Affordable Housing Options Throughout The Borough

The New York Post recently published an article highlighting something that many have known for years.  That is that Queens County has increased options of housing with new construction happening all throughout the borough.  The article indicates that middle class families are finding relief in Queens as rental prices have remained moderate due to increased apartment choices.  Queens has always been an affordable option in NYC as median rent is an estimated $600 less than other areas of the city.  The NYC Economic Development Corp. (NYCEDC) registered 2,847 new housing units in February, with 1,234 of those in Queens.  This is 43% of all housing units in the city and a 300% increase for the last 12 months preceding.

Long Island City has been the center of the housing boom for the borough, however other areas are seeing new developments as well.  According to construction data analyzed RentCafe in June 2017, Long Island City led the nation in most new apartments since 2010.  The neighborhood had 66% more apartments built than the 2nd placed locale.

Queens Chamber of Commerce President Thomas Grech said of housing starts “we’ve been waiting for someone to notice this for a while. Queens has become very popular, and it is a low-cost housing alternative for many in the city. We have, as we speak, between 20,000 and 40,000 housing units being built in a cluster in Long Island City as well as in certain parts of Jamaica, which is also an up-and-coming area.”

Most recently Curbed New York highlighted the development boom in and around Jamaica, Queens.  The 15 new projects is overall impressive and the centerpiece project is The Crossing at Jamaica Station.  The project will have 669 affordable housing units across two buildings adjacent to the Long Island Railroad Station hub.  Clearly these are major changes that will change the landscape of the borough for decades to come.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/queens-county-is-seeing-a-housing-boom-increasing-affordable-housing-options-throughout-the-borough/

City Council Passes Rezoning of Jerome Avenue Enabling The Development of Residential Buildings

The City Council has finally approved the rezoning of 95 blocks of Central and South Bronx along Jerome Avenue.  The approval which took over three years to be finalized will allow for the development of an estimated 4,600 new housing in the area.  The plan also calls for a permanent 1,150 affordable units to be built within the next decade and transform what is now considered an industrial area into one with mid-sized high rise apartments and retail.

According to the Commercial Observer, the Jerome Avenue district will run from McClellan Street in the south to 184th Street in the north, passing through Highbridge, Concourse, Mount Hope, University Heights and Morris Heights. Along with the deBlasio administration's adherence to the recently passed Mandatory Inclusionary Housing Amendments enacted in 2016, the administration also agreed to constructing two elementary schools, initiating a Housing Task Force whose goal is to preserve 2,500 units in the area and creating a program funded by up to $200,000 which will be used for tenant organizing and addressing tenant displacement.

Opponents of the City Council vote were very vocal of the displeasure of the rezoning.  Of their concerns are that the rezoning would reduce the amount of affordable housing.  They wanted more assurances that there would be added requirements by developers to include affordable housing.  Another concern is that businesses along Jerome Avenue would be compromised by construction that will eventually take place.  Many would have to shutter because of it.  Despite this, Borough President Ruben Diaz, Jr. supports the overall plan and believes that the protections set forth in the plan should enhance the visibility of the area.

"With today’s vote, the City Council has secured a positive future for the Jerome Avenue corridor that is inclusive of the area’s current residents and does not leave the people of The Bronx behind.  As part of the ongoing negotiations on this rezoning, both my office and the City Council, led by Council Member Vanessa Gibson, have secured considerable protections for the area’s existing residents and businesses. My office was able to negotiate commitments from the administration that will provide deep affordability in new apartments, new protections against tenant harassment and the preservation of thousands of existing affordable units in Community Boards #4 and #5, among others.

 

The City Council has built on that success, securing new protections and job training services for the autoworkers within the Jerome Avenue corridor, new funding for park and infrastructure improvements, and new programs to encourage local hiring. I especially want to thank City Council Members Gibson and Fernando Cabrera for their focus and dedication on this issue, and the years they have spent working to ensure that the needs of the community are balanced against the expectations of this rezoning. The people of The Bronx are not opposed to improvement. However, the rezoning of the Jerome Avenue corridor must work for everyone. The agreements that have been secured by my office and the City Council will help do just that, and I look forward to working with the administration to begin the implementation of the initiatives and programs they have agreed to provide."

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/city-council-passes-rezoning-of-jerome-avenue-enabling-the-development-of-residential-buildings/

NYC Has 7 Of The Top 20 Gentrified Zip Codes In The Nationwide Leading To Increased Home Value

A new study by Rentcafe found that NYC has 7 of the top 20 gentrified zip codes in the nation.  The study looked at the 2000 Census data as well as the 2016 American Community Survey to see changes taken place in over 11,000 zip codes throughout the nation.  According to Rentcafe they study looked to three important factors to determine where gentrification was taken place.  The factors was median home value, median household income and the population holding a bachelor's or higher degree.  From there, their analysis gave an average rank based on zip code.  In the NYC area, Brooklyn led the way with 5 of the top 20 zip codes leading in gentrification.  This was followed by Manhattan with two zip codes.

Along with gentrification comes increases in home values.  According to the study the average home value in 2016 in the top 20 most gentrified zip codes was $446,730 with an average increase of  224% since 2000.  All areas in the Brooklyn zip codes (11211- Williamsburg, 11222- Bushwick, 11216- Bed-Stuy, 11237- Bushwick and 11221-Bed-Stuy/Bushwick ) saw increase in home values above 100% since 2000.  The Manhattan zip codes (10039-Washington Heights and 10026-Harlem) both saw increases well above 200% during the period.  The most interesting zip code in Manhattan according to the survey was Roosevelt Island's 10044 which saw an astronomical increase.
According to the article

"New York City dominates the top of the list, with some dizzying figures. That the median home value in New York’s 10044 (Roosevelt Island) exploded, going from just over $48K to almost $655K is just one way to put it. Proportionally, it is an astonishing 1,258% expansion rate."

The study points out that there are drawbacks to the gentrification of neighborhoods.  As we have seen in many areas in New York City, the influx of new highly educated individuals leads to displacement of long time residents of the community.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nyc-has-7-of-the-top-20-gentrified-zip-codes-in-the-nationwide-leading-to-increased-home-value/

Existing Home Sales For February 2018 Increases Despite A Significant Drop in the Northeast

Existing home sales grew three percent (3%) in February changing course from the previous two months which were hampered by low inventory levels and overall increases in sales prices.  The report produced by the National Association of Realtors (NAR) saw the Northeast region (-12.3%) having a huge decrease in existing home sales and that was followed by the Midwest (-2.4%).  Strong sales in the South (+6.6%) and West (11.4%) led to the growth for February altogether.   Cold and severe weather as we have seen in New York City this winter has affected existing home sales for the period for the Northeast region.

Total existing-home sales which are completed transactions that include single-family homes, townhomes, condominiums and co-ops increased to a seasonally adjusted annual rate of 5.54 million in February which is an increase from 5.38 million in January. With the numbers for this month, overall sales are ahead of last year's pace by 1.1%.  Median existing-home price increased 5.9% from the same period last year to $241,700.  It is the 72^nd straight month of year-over-year gains.  Surprisingly, total inventory rose 4.6% for February to 1.59 million existing homes.  The amount is a positive sign however is still 8.1% below the amount for the same time in February 2017 and is the 33rd consecutive month we have seen year over year inventory being lower.  Unsold inventory is at 3.4 month supply which is significantly low.  A healthy supply would be 6 months.

Chief economist for the NAR Lawrence Yun said the following:

“A big jump in existing sales in the South and West last month helped the housing market recover from a two-month sales slump.  The very healthy U.S. economy and labor market are creating a sizeable interest in buying a home in early 2018. However, even as seasonal inventory gains helped boost sales last month, home prices – especially in the West – shot up considerably. Affordability continues to be a pressing issue because new and existing housing supply is still severely subpar.  The unseasonably cold weather to start the year muted pending sales in the Northeast and Midwest in January and ultimately led to their sales retreat last month. Looking ahead, several markets in the Northeast will likely see even more temporary disruptions from the large winter storms that have occurred in March.”

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/existing-home-sales-for-february-2018-increases-despite-a-significant-drop-in-the-northeast/

NY Has Most Apartments Under Construction Nationwide; NYC Remains Alluring to Renters As Economy Grows

GlobeSt.com is reporting that New York has more than 60,000 apartment units under construction and that’s the most out of any city that CoStar Group has been tracking nationwide.  CoStar is a provider of information, analytics and marketing services to the commercial real estate industry in the United States founded in 1987.  In an in-depth interview with CoStar Group analyst Lauren Baker many interesting tidbits of the state of New York City apartment renting came into light.  CoStar reports that the since the economy is growing, we should see a healthy rental market for years to come.  Here is some highlights of the interview:

“People want to live where they are working, so office construction drives residential properties, and all of these companies want to be in Manhattan,” says Baker. “Highly educated, younger people, 24 to 35-year-olds with a bachelor’s degree are moving into Manhattan.” In contrast, the outer areas in the state of New York have been decreasing in population.

The financial sector accounts for more that one-quarter of total wages paid and there is expansions by private equity investors, M&A and hedge funds.  The growth in the financial sector has been higher that the national average however they have been seeing some of the bigger banks still laying off employees and reducing bonuses.  However they do believe that with the profits of the six largest US banks substantially growing with deregulation assisting there may be a greater jump in the sector.  

Media and technology will be the stimulus of the city’s future economic growth according to CoStars NYC 2017 multifamily market report as it as been growing for the last 3 decades. Eighty six percent of tech job are in Manhattan but firms are beginning to set up in Brooklyn and Queens as well.  As more people are moving in these industries we are seeing more units being built in places like Long Island City located in Queens and Brooklyn.  More than 8,000 housing units are under construction in Long Island City which is the most in any submarket in the US according to Baker.  She also says “There’s a ton of multifamily units being constructed currently, especially in the outer boroughs.”

The outer boroughs offering lower prices, larger apartment sizes and more amenities.
At the end of the day, NYC will remain an attractive area for renters to be moving to.  Baker states “New York is New York. It’s not going anywhere. People want to live here. It’s proven time over time. It doesn’t matter how many units are built. People want to live here at the end of the day.”

 Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/ny-apartments-construction-nationwide-nyc-remains-alluring-renters-economy-grows/

New Legislation In Reforming Scaffold Law Introduced As Advocates Hit NY Capitol

New legislation was introduced in Albany to reform what many consider the antiquated Scaffold Law in Albany as part of the Scaffold Law Reform Day on February 15, 2018.   The Scaffold Law was originally set forth in 1885 in order to protect construction workers injured in work-related accidents.  The law placed absolute liability on the property owner and construction company.  This means that the worker's negligence was not taken into account when limiting damages and percentage of fault.  It was an assurance of worker's compensation before such laws were in place in New York State.
A union of businesses and trade organizations have gathered to form a group called Scaffold Law Reform.  They gathered in Albany on the 15th for what they deemed Scaffold Law Reform Day.  Their goal was to  "urge legislators and Governor Andrew Cuomo to fix the only-in-New York Scaffold Law, and highlight the law’s impact on taxpayers and local governments".  According to the organization's website they cite the following as what New Yorkers pay for as a result of the Scaffold Law

 "The Scaffold Law costs taxpayers $785 million annually. 
– The Scaffold Law is estimated to add $200 – $400 million in additional costs to the construction of the new Tappan Zee Bridge.
– Local governments pay higher costs for capital projects, whether the work is done directly or through private contractors. For example, liability costs on one joint NY-NJ bridge projects are more than double on the NY side (see graph at right).
– More than half of the top 30 highest settlements resulted from Scaffold Law claims, and of those, 25% were against public entities. 
– The Scaffold Law adds as much as $10,000 to the cost of building a new home. 
– In 2014, the New York School Construction Authority’s (SCA) insurance costs soared to $240M because of the scaffold law, nearly triple that of the previous year, and no guarantee of coverage after 2014.
– The SCA’s increased insurance costs are equivalent to 8-10 new schools over a 3 year period. 
– Higher insurance costs for the SCA jeopardize the future of their Owner-Controlled Insurance Program, which provides insurance to over 800 M/WBE firms. Without this program, hundreds of M/WBEs may be put out of business.
– According to many disaster relief groups, the Scaffold Law has severely impacted reconstruction after Superstorm Sandy"

The impact to New Yorkers has also set legislators into action.  On the same day of the the gathering, a new proposal was introduced by Assemblyman John T. McDonald.  The proposal, which can be read here would change the standard from absolute liability and introduced contributory negligence when determining fault and damages.  The idea has been gaining momentum in the State as several influential periodicals have recently wrote about how the scaffolding law negatively impacts business in the State.

Mr. McDonald said this about the legislation he has introduced

"Safety is ultimately most important, which is why the reform we propose would simply make liability proportional to fault and would not weaken the law's safety provisions. By doing this, we are applying the same standard to every other type of liability throughout New York and we preserve the right for injured construction workers to sue, because we recognize the unique and dangerous nature of their work. We believe that proportional liability, when included in underwriting insurance, will lead to a reduction in the high insurance costs which we must hold insurance companies accountable for. In fact, according to a Cornell study peer reviewed by the Transportation Research Board of the National Academies of Science Engineering, and Medicine, "absolute liability" may actually increase the risk of work site accidents. Fixing the law would not only lower construction costs — which would allow firms to allocate more funds to hiring and compensation — it would actually create a safer work environment for all.

As lawmakers we must work together to solve problems and move this state forward. This is why we have decided to reach across the aisle and we stand ready to work with the governor and all of the stakeholders to fix this unjust and costly liability law. With the state budget currently under discussion, Scaffold Law reform should be a priority for all involved parties as we strive to make our state a more affordable place to live, with a friendlier business environment and more opportunity for our men and women in the labor force."

It should also be noted that New York is the last State to have the absolute liability as the standard since Illinois changed their laws in 1995.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/new-legislation-reforming-scaffold-law-introduced-advocates-hit-capitol/

NAR Report: Housing Shortage Hampers Existing Home Sales in January

The National Association of Realtors (NAR) released their January 2018 report which indicates that housing supply is still affecting existing-home sales nationwide.  For the second month in a row, existing home sales which are completed transactions that include single-family homes, townhomes, condominiums and co-ops has gone down by 3.2% in January to a seasonally adjusted annual figure of 5.38 million units.  Overall sales are down 4.8% year to year which is the largest decline since 2014.

The main factor for the decline in the sale of homes during this period continues to be the lack of supply.  Lawrence Yun, chief economist for NAR states “The utter lack of sufficient housing supply and its influence on higher home prices muted overall sales activity in much of the U.S. last month.  While the good news is that realtor in most areas are saying buyer traffic is even stronger than the beginning of last year, sales failed to follow course and far lagged last January’s pace. It’s very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth.”

The numbers clearly show that house prices are becoming less affordable as the median existing home price increased to $240,500.  This is a 5.8% increase from the same period last year ($227,300).  Housing inventory overall increased this month 4.1% to 1.52 million homes but is still down 9.5% from a year ago.

In the Northeast, sales were down 7.6% from a year ago and decreased by 1.4% for the month.  The project annual rate of sales is 730,000.   Median purchase price in the region was $269,100.  This is an increase of 6.8% from January 2017.

 Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nar-report-housing-shortage-hampers-existing-home-sales-january/

NAR Report: Home Prices Hits All-Time High in 64 Percent of Markets; Inventory Historically Low

Home prices are now at their all-time highs in 114 out of 177 markets (64%)  measured by the  National Association of Realtors (NAR) according to their new quarterly report.   The median price for existing single-family homes the fourth quarter 2017 was $247,800.  This is an increase of 5.3 percent from fourth quarter 2016 ($235,400). The report also purports that an increase of existing home sales in the last quarter of 2017 has facilitated inventory to reach all time lows.

Existing-home sales which includes single family residences and condos/coops has  increased 4.3 percent to a seasonally adjusted annual rate of 5.62 million in the fourth quarter.  This is higher than the 5.55 million pace during the fourth quarter of 2016.  Also of note in the fourth quarter is that there were 1.48 million existing homes available for sale.   The meager amount is roughly 10.3 percent below the 1.65 million amount of homes available at the same time in 2016. The average supply during the fourth quarter was 3.5 months down from 4.2 months.  The general consensus is that 6 months of inventory is considered a healthy balance.

Lawrence Yun, chief economist for NAR states   "A majority of the country saw an upswing in buyer interest at the end of last year, which ultimately ended up putting even more strain on inventory levels and prices.  Remarkably, home prices have risen a cumulative 48 percent since 2011, yet during this same timeframe, incomes are up only 15 percent These consistent, multi-year price gains have certainly been great news for homeowners, and especially for those who were at one time in a negative equity situation; however, the shortage of new homes being built over the past decade is really burdening local markets and making homebuying less affordable."

In the Northeast home sales increased a significant 10.1 percent in the fourth quarter.  The median existing single-family house price in the area was $268,100 in the fourth quarter.  This is an increase of 4.2 percent from 2016 at the same time.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nar-report-home-prices-hits-time-high-64-percent-markets-inventory-historically-low/

Commercial Lease Assistance Program Announced By NYC Will Include An Average Of 40 Hours of Free Legal Services

The City of New York has announced a new program to assist small business owners with issues revolving around their tenancy. The Commercial Lease Assistance Program which will be under the guidance of the NYC Department of Small Business Services, will give small businesses an average of 40 hours of free legal services.  The city has stated that the services that will be covered will include issues revolving around "negotiating a lease, resolving landlord issues, responding to an eviction notice, breach of contract disputes, and lease renewal."  The announcement further explains that the program will not represent clients that end up in court although there is not have been a statement on whether the selected attorney can represent the business in an outside capacity.

The Commercial Lease Assistance Program will receive $2.4 million in funding from the City of New York.   Gregg Bishop, Commissioner of the NYC Department of Small Business Services says “Small businesses don’t have legal teams like the big guys do, but we are making it clear that the City stands in their corner.  Even basic legal help can be costly and out of reach for small business owners, but this free service will go a long way towards helping small business owners solve problems related to their lease.”  This is the second program that the City of New York under the de Blasio administration will be funding to assist tenants.  In July of 2017, the City Council passes legislation to allow low income tenants to have free legal representation if they are facing eviction.  The new program will have an income eligibility requirement as well.

According to the release, small business owners in need who cannot otherwise afford an attorney are eligible for this program. Examples of businesses that may be eligible:

• Are immigrant-, minority-, women-, or veteran-owned,
• Employ local low-income residents,
• Are located in a rezoned or high-poverty areas; Or
• Offer job training opportunities

Mayor de Blasio said in a statement “Small businesses are the economic heart and soul of this city and they deserve every opportunity to succeed.  The Commercial Lease Assistance Program will give small-business owners the help they need to resolve legal issues without driving them out of business.”   Gale A. Brewer, Manhattan Borough President expanded the need for this program for small businesses in saying "Small businesses are big contributors to our city, which is why it’s crucial that we provide support services to help them compete and thrive.  Legal assistance, especially lease assistance, will be a big help for storefronters and small business owners.”
To be eligible to participate, your business must:

1. Be a small business according to the US Small Business Services Administration (PDF);
2. Be located in New York City;
3. Not be a franchise establishment; and
4. Meet the income eligibility requirements of the legal service provider.

Businesses can visit nyc.gov/commlease or call 311 to determine their eligibility for the Commercial Lease Program.
Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/commercial-lease-assistance-program-announced-nyc-will-include-average-40-hours-free-legal-services/

National Survey Shows NYC Renters Have Increased Satisfaction And Are Pleased With Value

Kingsley Associates, a business intelligence firm headquartered in San Francisco and a leader in resident and tenant satisfaction surveys released a report for ending in the 2017 period.  The national survey which polls tenants from leading cities throughout the United States indicates that renter satisfaction remains steady throughout the nation, however we are seeing tremendous increases since the last report from 2016.  The survey, which you can read fully here also indicates that renters in New York City gave higher scores with respect to renter renewal intent and value for amount paid for 2017.

National renter satisfaction according to the survey indicated that the rate of satisfaction climbed .1% in 2017 for 76.9% in the fourth quarter 2017.  New York City saw the highest levels of tenant satisfaction as the rate increased 3.2%.  Other significant cities with increases included Atlanta at 1.6% increase and Denver with 1.8%.  An increase in renter renewal intent was also highest in New York City according to the report.  There was an increase of 5.4% of tenants likely to renew their leases.  Increases were also seen in Boston at 4% and Atlanta.

Nationwide renters who were satisfied with the value they receive from their apartment compared with the price they pay increased only .1% from the previous quarter to 54.5%.  New York saw tenants very happy with the value of their rentals.  According to the report:

"Despite being known as an expensive rental market, New York has consistently achieved higher scores than most of the largest U.S. markets in renter satisfaction, renter renewal intent, and value for amount paid throughout the past year. In New York, 81.0% of renters are satisfied overall, 58.0% intend to renew their leases, and 56.7% are satisfied with the value for amount paid. For renters who indicated that they intend to renew their leases, location, community management, and security were the top factors influencing their decision. For renters who expressed satisfaction with value for amount paid, location, apartment features, and rental rate greatly influenced their positive value perception.
Recent changes in the New York market have shifted the power from apartment owners and managers to renters. "

So what do tenants believes give value to their apartment?  The survey indicates that air-conditioning, dishwashers, washers and dryers, and garbage disposals are the biggest amenities tenants are looking for.  Overall 75% of the polled renters said they wouldn't lease a particular unit if these features weren't included.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/national-survey-shows-nyc-renters-increased-satisfaction-pleased-value/

Report Indicates that Airbnb Removes Available Housing and Increases Rents in NYC

A report by McGill University's School of Urban Planning shows a negative effect of Airbnb to residents of New York City.  The Report titled "The High Cost of Short-Term Rentals in New York City" and authored by a research group at McGill University and funded by a hotel union found that 45% of Airbnb listings were illegal.  This amount accounted for $435 million in revenue during the period of the report which was between September 2014 through August 2017.  Of further significance is that New York City  is that Airbnb has taken out of the market between 7,000 and 13,500 units of housing from New York’s long-term rental market.  This has had adverse effect on rent prices as median rents has increased $380 all throughout the city and $780 in Manhattan alone.

The study found that Airbnb has had a positive affect on gentrification in that 72% percent of the population in neighborhoods at the highest risk of Airbnb-induced gentrification across the city are predominantly non-white. According to the research there is a significant disparity on the income earners of using the short term rental marketing.  "Airbnb hosts are 5 times more likely to be white. In those neighborhoods, the Airbnb host population is 74% white, while the white resident population is only 14%. White Airbnb hosts in Black neighborhoods earned an
estimated $160 million, compared to only $ 48 million for Black hosts—a 530% disparity. "

Airbnb has gone on the record and has disputed the findings of the McGill report.  They state that their methodologies are flawed especially the amount of nights visitors rent to Airbnb guests.  They also say that Airbnb has created $3.5 billion in economic activity for the city and 2 million guests have used them.  It should be noted that under NYC law, it is presently illegal to rent out an entire apartment in a multi-unit building for less than 30 days. Homeowners can be punished with violations and fines as a result.  Many NYC property management companies have been proactive to the use of Airbnb by their tenants and have sent out notices to existing tenants of buildings indicating that they would pay rewards for information resulting in the use of short term rentals by other tenants.  It is of high priority to property management companies to curtail the use of Airbnb as penalties and fines would be given to the owners of the premises.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/report-indicates-airbnb-removes-available-housing-increases-rents-nyc/