The Post-Covid Market Much has been said about the renewed strength of the NYC real estate market in recent months. The Manhattan market, which had been in a lull for a few years, has been on the rebound since late 2020 and is once again officially a "seller's market." In the first quarter of 2021, the total number of Manhattan closings increased by a striking 37% compared to the fourth quarter of 2020. Recent contract activity has also reached numbers not seen in many years. Since the start of this year, total signed contracts in Manhattan surpassed 2019 figures for the same period by more than 50%. The luxury market in particular is on an "extraordinary streak," according to the Olshan Report, which tracks contracts over $4M. As for Brooklyn, sales had plateaued in recent years, including throughout the early part of the pandemic, but since the late Fall, sales have been climbing once again. Inventory has remained very tight and competition has been fierce, especially for properties under $2.5M that check all the boxes. Contrary to the doom-and-gloom predictions of an exodus, NYC appears to be experiencing a surge in housing demand. The picture on the ground has been hectic. Showings are still, by and large, by appointment only. For some properties, this has meant that simply getting an appointment before the barrage of offers has been a challenge. More deals are being made, but the time it takes for transactions to close has increased as lenders, attorneys, and management companies have struggled to keep up with the pace. This has kept us busy, but we're grateful for the resilience and renewed vigor of the market coming out of the pandemic. Covid After-Effects With all these positive market reports, what has been much less reported are some after-effects of the “Covid market” that has been affecting our transactions recently. Coupled with the overwhelming volume, which has led to lender delays and prolonged closing timeframes all around, we've encountered some unique challenges recently: - Low Appraisals - Many people think an appraiser provides an objective, unassailable "valuation" of a property. However, what they don't realize is that bank appraisals are limited by some very strict guidelines that apply uniformly. While the guidelines do allow for "adjustments" based on an individual appraiser’s judgement and their understanding of market conditions and trends, appraisals can sometimes be far less reliable than one would think - especially in rapidly changing market conditions. Across Manhattan and Brooklyn, we’ve seen a recent spate of low appraisals which I believe can be attributed to Covid's effect on the market last year. Appraisers predominantly rely on sold listings to justify contract prices, and banks require that any sold listings included in their report must have closed in the last year. Given there were essentially zero contract/sales activity for 3+ months of 2020, the pool of available comparable sales that appraisers can choose from is much smaller than usual. Also, most deals that were negotiated during or directly after "NY on Pause" (March 21-June 28 for real estate activities) entered contract at a time of huge uncertainty and were therefore at lower levels (and with steeper discounts) that are not indicative of current market conditions. This is an issue that will resolve itself in time as more sales that reflect current market conditions continue to close. In the meantime, we have been advising our sellers to consider financing contingent offers carefully, especially with a downpayment of 20% or less since this provides no cushion for a low appraisal. - Co-op Board Applications - The second Covid after-effect we've observed is a heightened scrutiny by co-op boards in considering purchase applications – particularly when evaluating self-employed applicants, many of whom were negatively affected in some way by Covid-related restrictions in their industries last year. Co-op boards consider income and liquidity in evaluating purchasers, and both of these metrics have become harder to meet as a result of Covid. Usually, boards look at the last two years' income, but with 2020 being an aberration for many, we have had to hope that boards would consider an applicant's historical income and 2021 year-to-date information. On the liquidity side, many boards seem to be looking for increased reserves to protect against "another Covid."

As we enter the new year, we are taking a break from charts or statistical tracking to give you a more holistic recap of the 2020 market. For those of you that are more numerically inclined, fear not -- we'll be back with that sort of analysis in early February to recap market activity and data from the first full month of 2021. Looking back, the first two months of 2020 were actually quite promising, with renewed activity that seemed poised to reverse the gradual market slowdown that had been ongoing since mid-2018. Then, just before the busy Spring market really got going, the world stopped. Covid effectively shut down all real estate activity in NYC from March 20 to June 28. Several things happened during "NY on Pause." First, virtually any deal that had an accepted offer in early March but had not yet been signed into contract either fell apart or, if the sellers were lucky, was re-negotiated. Deals that were in contract were at best delayed (with most of those closings taking place in June/July) and some buyers even chose to walk away from signed contracts, leaving behind their 10% deposits. Many buyers combed through their sale contracts to find seller defaults to re-negotiate their contracts. As for new deals, there were only a handful of contracts signed, most early on, which were negotiated at deep discounts as uncertainty loomed. With a moratorium on all in-person showings, the market was at a relative standstill. In the early days of the moratorium, with no clear picture of when activity would resume, speculation, uncertainty, and apocalyptic predictions abounded. Even before in-person real estate activity was permitted to resume on June 28, things had begun to look up. The stock market had begun to climb, while NYC's Covid numbers were finally on the decline. In May and June, some new deals came together. Aside from a handful of outliers, a majority of contracts signed during this time were within 10% of asking price in Manhattan and within 5% in Brooklyn. New listings began to slowly enter the market in June, followed by a surge in the first few weeks of July when in-person showings were able to resume. Listing prices largely remained at pre-Covid levels, as sellers braced themselves for buyers expecting to negotiate. Contract activity picked up, but aside from a small number of new listings that were snatched up immediately, buyer demand lagged relative to the new wave of listings. The Fall market saw more buyer activity -- showings, inquiries, interest -- but deals were slow to culminate, and new inventory continued to enter the market adding to a growing surplus. Some neighborhoods -- like Midtown -- were hit harder than others, with very little buyer activity even after drastic price cuts on most of the listings. In the deals that did come together, contract prices in Manhattan largely remained within 10% of ask, although some neighborhoods saw far less (or more) negotiability than others. While Brooklyn numbers seemed to track on paper, on the ground activity was less frenzied than in the past. With buyers taking a more cautious approach, days on market figures in Brooklyn had risen borough-wide by the end of the year. Since the election and announcement of the initial vaccine distribution plans in November, the Manhattan market has regained some ground. By the end of the year, sellers and buyers seemed to be converging. While total number of closings were lower than in previous years, contract activity picked up and ultimately exceeded historical levels in the final months of 2020. Many properties that had been on the market for months suddenly saw an uptick in interest, with a few even receiving multiple offers, pushing sale prices closer to asking than anticipated. By the end of the year, low rates and negotiability enticed many buyers who were sidelined into recognizing value, especially in the luxury sector which has seen a healthy rebound from a years-long slump. Those looking have flocked toward larger homes with the average square footage of 2020 sold listings up a whopping ~30% compared to 2019. At the end of the day, we have not seen the mass exodus out of the city that many predicted, although Covid did accelerate the move for many folks who were already considering it. As we enter 2021, we are seeing a significant uptick in activity with our own buyers, and inventory levels remain low, with very few new listings entering the market since the start of the year. It remains to be seen how this dynamic will play out, or if it will continue as we get closer to the start of Spring. Currently, we expect the market to continue improving during 2021, although there are still deals to be had, especially for buyers looking in the areas of Manhattan that were hit the hardest during 2020.

With the Fall market now behind us, two major trends have emerged. First, there continues to be the tale of two Manhattans, mostly dictated by location, with some properties going quickly and at pre-Covid prices and others that continue to languish on the market with little interest. Second, the narrative of Manhattan vs. Brooklyn has shifted. While early data painted the picture of a struggling Manhattan and resilient Brooklyn, contracts and closings since October 15th indicate that some areas of Manhattan are seeing a marked return of buyer interest. In Brooklyn, which has been relatively more stable, there has also been a gradual uptick in days on market and price reductions/negotiability. In Manhattan, total contracts signed from October 15th to December 15th was higher compared to the same time last year, a promising sign coupled with a rebound in number of closings, down just ~37% from 2019 levels since October 15th (compared to ~67% during the first 4 weeks of Fall). As a reminder, closings are a lagging indicator, so most closings in late Fall reflect deals that went into contract between July and September. Given the uptick in activity and contracts (especially since the election), we would expect the closings indicators to be even stronger in early 2021. Downtown gained momentum throughout the Fall season, with declines in days on market, fewer price reductions, and faster absorption than any other Manhattan sub-market. Currently, downtown listings make up less than 30% of active inventory, yet made up 36.3% of closings and 32.3% of signed contracts between October - December 15th. The Upper East and Upper West Sides also saw a healthy uptick in closings compared to earlier in the season, as well as a modest decline in days on market. However, recent Upper East & West Side sales came at significantly greater discounts than earlier in the Fall, with median negotiability increasing from 2% below to 6.3% below last-asking. The Midtown market remains the hardest hit by COVID, with significantly fewer closings, longer days on market, more price reductions, and greater negotiability than any other Manhattan sub-market. More than 42% of Midtown listings sold since October 15th reduced their asking prices before entering contract (by a median -9.1%), and still closed a median 4.3% below last-asking. There has been much positive press about the Manhattan luxury market in recent weeks, which had been in decline since long before COVID. In the three weeks following Thanksgiving this year, more $4M+ contracts were signed than during the same period last year, indicating that some luxury buyers have been enticed back by low interest rates and further price reductions in the late Fall market. In Brooklyn, negotiability, price reductions, and days on market have remained much lower than in any part of Manhattan, but these indicators have gotten weaker as the season has progressed. Since October 15th, days on market and % of listings with price reductions while actively listed increased for homes sold across all sub-markets compared to closings during the first 4 weeks of Fall. Notably, the % of homes sold in BoCoCa (Boerum Hill, Cobble Hill & Carroll Gardens) that reduced asking price before entering contract more than doubled, and homes in all sub-markets other than South Brooklyn saw at least a 10 day increase in median days on market. While the Brooklyn market remains much stronger than Manhattan overall, the urgency that fueled bidding wars and made over-ask sale prices the norm in much of Brooklyn has faded, and Brooklyn sellers have increasingly had to adjust pricing and expectations in order to engage buyers. Looking ahead, the NYC sales market is traditionally quiet from mid-December through February, although it's hard to predict if this will remain true this year. Anecdotally, the momentum in buyer activity since the election has not yet ebbed, buoyed by optimism for the vaccines, low interest rates, and the perception that the worst for NYC real estate is already behind us. Our current expectation is that, except for the 2-3 weeks right around the holidays, the market is likely to be far more active this Winter season than in previous years. While we expect activity to be strong, rebounding to pre-COVID (or peak) pricing will take some time as increased buyer confidence will likely be counterbalanced by an influx of new inventory this Spring.

My husband Bill and I rented in Cobble Hill for about 5 years before we seriously considered purchasing. Our wishlist was long and there were many different neighborhoods we could see ourselves living in, but nothing really seemed to work, and buying did not seem financially feasible at that moment. We were casually exploring the idea of a second home outside the city, and then I heard about this magical lake that seemed to fit our whole wishlist. Without giving it too much thought or deliberation, we put in an offer and within a few months were proud owners of a money pit, I mean second home…. While we now love our lake house and having a weekend escape, there are many things I wish we would have thought more about before leaping in. I hear from many folks considering a second home before the first, and while it may be a good idea, it’s important to weigh the following: A second home could make it more challenging for you to buy your first home. The mortgage, taxes, and other expenses related to your second home increase your debt-load and may preclude you from purchasing in a co-op, significantly reducing the housing stock available to you. Co-ops are more prevalent than condos -- especially in Manhattan -- and are generally priced lower, but co-ops have strict requirements about prospective buyers’ financial qualifications. Any additional debt or costs associated with your second home will almost certainly count against you when a co-op is assessing your qualification to purchase. Another long-term financial factor is your liquidity. Anyone who owns a home knows that unexpected expenses often arise at inopportune times. When assessing your future liquidity needs for a “primary home” purchase, you should factor in your second home’s ongoing carrying costs as well as the “cushion” you need for unexpected expenses. Property in NYC can be a very lucrative investment, but that is not the case in all markets. Most real estate markets don’t perform nearly as well as the NYC market does over the long term -- if you look at the sales history of some properties outside NYC, current prices might not be much different than 15 years ago. So while the NYC market is pricier than other markets, properties in NYC tend to hold their value and appreciate at fairly consistent rates over time. Secondary home markets are typically far more susceptible to adverse market conditions. While it’s possible to take advantage of such volatility, you could also end up holding the bag, especially if you purchase your second home (as most do) during good times. A second home can be more than an escape; it can provide you with an income stream, depending on the circumstances. Some properties pay for themselves and then some via short-term rental income. Or you can rent out your second home long-term if you are no longer looking to visit, thus making it a true investment property. In our personal experience, buying our second home first helped us find the perfect first home. After purchasing our lake house, our apartment search became much more clear and our wish list whittled down: We had always wanted outdoor space at our apartment, but after purchasing the lake house, where we have a lot of outdoor space, we realized we could do without it at our apartment. Storage also became less important to us as we didn’t need to keep all our possessions in an apartment or storage facility. We were able to prioritize the things that actually mattered to us in our day-to-day life. Convenience and commute became the more important factors for us, so we ended up purchasing an apartment in a doorman building that is walking distance to both of our offices. Buying a second home before a primary residence is a big decision that comes with some risk but can yield great rewards. If you’re interested in this option, I’d love to help you weigh your options and connect you with a great local agent who can provide specific advice and guidance. #FAQBuyer

When working with buyers, especially those looking at pre-war homes, one of the first questions I ask is when the last Local Law 11 cycle was completed. Local law 11 work, which addresses maintenance to the facade and exterior of a building, is expensive and often cause for a building to levy an assessment (a short term increase in monthly charges paid by owners.) While most buyers are far more concerned with kitchen renovations and closet space during their home search, in NYC, general building condition and any impending façade work can be an another important factor to remember. Falling debris in the 1970s led Mayor Ed Koch to pass Local Law 10 to make sure building exteriors in the city were safe. All buildings that are 6 stories and higher must be inspected. The law evolved when Local Law 11 was passed in 1998, which created additions regulations. Additions to the law include the following: -The entire building must be inspected, not just the sides that face the street -All inspections must include scaffolding, instead of visual inspection from a distance -Buildings must complete a report on any deterioration and then classified as "Safe," "Unsafe," or "Safe with a Repair and Maintenance Program" Buildings are on a staggered 5 year cycle to inspect and complete any necessary repairs. You can learn more about Local Law 11 here. #FAQ #FAQNYLiving

Cue the Evil Empire Star Wars music... Most New Yorkers considering purchasing real estate probably have some opinions about the board, particularly the dreaded board interview. But how much should this really be dreaded and how much sleep should a prospective buyer lose over the interview? First off, if you have a board interview scheduled, congratulations! You've almost made it to the promised land. Most coop boards will only schedule an interview if they have already vetted your application and determined you've meet their basic requirements. There are always exceptions, particularly with some of the very fancy buildings, but usually the board interview is just to make sure you are not a terrible neighbor/person in real life. They don't have to love you and think you are interesting and wonderful, just not awful. So if you've made it this far, relax, get a good night's sleep, and keep in mind a few of these helpful tips to get a swift board approval: 1) Being invited to the interview is a good sign. The interview is the board’s opportunity to meet you and ask specific questions about your application. The style of the interview can range from an informal gathering of board members in an apartment to a formal interview with board members lined up at a table with you in the hot seat. 2) Dress up and be prompt. In terms of dress and promptness only, see tip 6 below, a board interview should be treated no differently than a professional job interview. 3) Prepare for a lack of privacy. The board has great latitude in the kinds of questions it can ask, be prepared for this and do not avoid answers to personal questions, or be angered by this intrusion. 4) Don't get defensive. As a further point to number 3, do not get defensive to any intrusive questions or remarks that may seem off-putting. The board is made up of people with quirks, and some may not correctly remember details of your application and their questions may seem off. For example, I had a client who in the five years after completing school, had saved up enough money to pay off all of her student loans and then save for a downpayment and hefty reserves. By all accounts, it was impressive how smart she had been with her money. One board member asked her to explain how in five years of being a lawyer she had only managed to save only this much money. Rather than get defensive, a proper response is that she worked very hard to save as much money as possible and she was very excited to invest these savings in purchasing this lovely home. 5) Know your application. You should be able to quickly and concisely answer any questions asked regarding your application, preferably without having to look at your application. I'm attaching the questionnaire portion of your board application for you to take a look at. 6) Couples should decide in advance who will answer what types of questions. For example, you may agree to answer all financial questions and your spouse/parent(s) will answer all other questions. Avoid discussing answers to questions with your spouse/parent(s) in front of the board. 7) Unlike a job interview, do not try to sell yourself. Only answer questions asked and let the board run the show. Boards rarely turn down applications for being too boring. 8) Never volunteer information or engage in unsolicited conversations except for basic cordial remarks and greetings. 9) Do not ask questions. Questions can often unintentionally convey negative information to the board. For example: “Do you have any plans to renovate the lobby? ”is the kind of seemingly innocent question likely to offend the board member who was in charge of the last lobby renovation. If you have any additional questions you can direct them to me or your attorney. 10) A short interview is better than a long one. While there are no hard and fast rules, a short cordial interview with a few board questions and remarks is often the best co-op board interview. 11) Do not expect an answer at the end of the meeting. Most boards do not give their decision until a day or two after the meeting. We will take the necessary steps to determine if you have been approved. 12) Do not discuss renovations. Don't volunteer information about renovation plans. If they ask if you intend to renovate, say something short and non-committal like the unit may need some updating, but you have no concrete plans at this point. It is important to keep things as simple as possible, and not confuse the board interview for approval to purchase with board approval to do any work. Many board interviews are a breeze, but this article is a pretty good preparation in case you are faced with some common tough questions. Remember that your real estate agent will address any specific do's and don'ts with you. And as always, please reach out to me with any questions regarding the NYC home-buying process or residential real estate market. #FAQ #BlogPosts

Many NYC homeowners qualify for some form of tax credit or abatement that reduces their annual property tax burden. Most abatements and exemptions are tied to specific buildings, such as 421A and J-51 abatements. However, The New York State School Tax Relief Program (more commonly known as the STAR Program), is one of the few property tax rebate programs that is not tied to a specific building, and is available to almost all NYC homeowners. What is the STAR Program? The STAR program is a school tax rebate program aimed at reducing school district property taxes on the primary residences. The program was enacted on August 7, 1997, by then-Governor George Pataki. The STAR Program takes two forms: Basic STAR and Enhanced STAR. The Basic STAR is open to the primary residence of any New York State resident and exempts $30,000 from the true value of a home or property. The Enhanced STAR, for eligible senior citizens at or above age 65, exempts an annually variable amount from the true value of their primary residence. While the program is aimed to lower the tax burden on school district residents, it does not affect the overall revenue of a given school district; the difference is made up by the state. Are you eligible? If you own your home, it’s your primary residence, and your income is $500,000 or less, you’re eligible for the Basic STAR credit. If you’re a senior citizen with a qualifying income (currently equal to or less than $86,000/year) you may be eligible for the Enhanced STAR credit. For more information on elligibility, see the STAR eligibility chart below How to Apply If you are a new homeowner, you will have to apply in order to receive your STAR tax credit. Beginning with the 2016/2017 tax year New York State has changed the STAR application process. You are considered a new applicant if you purchased your home after March 15, 2015 or you did not apply for the STAR exemption by March 15, 2015. New applicants who qualify will receive a STAR credit in the form of a check, instead of receiving a property tax exemption. When you register for the STAR credit, the Tax Department will automatically review your application to determine whether you’re eligible for the Basic or Enhanced STAR credit. As long as you’re eligible for one of the two, you’ll receive a check for the amount of your benefit. Once you’ve registered, you’ll continue to receive the credit in future years – you don’t need to re-apply. Note that many NYC coops will assess out the amount of the STAR credit automatically. This means that if you don't apply, you don't not-get-a-check, but rather you owe your building the amount of your STAR benefit (this is how we realized we had forgotten to apply). For more details on the program, and to register for the first time, visit the NY State Dept of Taxation and Finance here. #FAQ #BlogPosts

Many apartment buyers in NYC are unclear about whether a home inspection is necessary. While your agent will advise you based on the property, here are some hard and fast tips on when a home inspection worth having before signing a contract. If you're buying a NYC apartment, there are typically three types of situations that warrant a professional home inspection. The first is if your prospective apartment is in a small building which is technically defined as 40 units or less. If the building is on the larger size of this range and has diligent management, an inspection is more discretionary. The reason an inspection is less important in larger buildings is two-fold: (1) In larger buildings, an inspector often cannot access important common spaces like roof, boiler room, etc., so the inspection is not as useful as it's limited to basic components of the unit only. These larger buildings will have detailed documentation concerning age, condition, and any problems with these major systems and structural components, so this data obtained by your closing attorney may be more useful than any visual inspection the inspector could have provided had he had access. (2) In larger buildings, any need for repairs or maintenance of these major systems is either paid for by the large reserve fund of a building or split among several owners, so new owners need not be as concerned about big potential liabilities if there is an issue. Second, if there’s a specific condition that could potentially cause hard-to-detect problems —such as an apartment on the top floor or ground floor, or with a roof deck or sub-level that may be more prone to leaks or water damage. Third, if you see small signs of these sorts of issues, like warped floors or staining on the walls or around windows, or if you’re buying an apartment that needs major renovation or is in “original condition” you might want to get the place inspected. Home inspections in New York City are done before the contract is signed – this is different than in most other places, where an inspection is generally done after. This means that as soon as you have an accepted offer, you will need to be ready to schedule your inspection. Your agent should help you through this process, and will usually have professionals they have experience working with and can recommend to you. I always recommend that buyers be present for a home inspection. It helps to see and hear the inspector’s findings directly – some items may be quite minor, while others may be more important, but it can be hard for a lay person to gauge the significance of these findings when reading the inspector’s report after the fact. Below are some of the main things your inspector will be on the lookout look out for: 1. Water infiltration from the outside: Moisture entering from the roof, terrace, and windows is most common. In below ground level apartments, moisture can enter from ground water or as a result of poor drainage. 2. Plumbing leaks: All sinks, tubs, showers, toilets, washing machines and dishwashers should be operated and checked for leakage. This includes supply and waste piping as well as faucet valve systems. Dishwasher door seals are prone to leaks and need to be checked, too. 3. Windows: Double hung windows should be examined to make sure that they stay up on their own, including newer replacement windows, which are designed with a “spiral balance system.” This style replaces the old string or chain and weight counter balance systems, but both types of windows can become misaligned, and can cause problems if they are unable to be easily opened or do not close or seal properly. 4. Electric wiring: Is the electrical capacity of the building/apartment up to the demands of 21st century technology? If the building was built 75 years ago, when most people had a radio and a few light bulbs, probably not, unless it's been rewired by a previous owner. Watch out for do-it-yourself wiring projects in older buildings. Your inspector will also check the GFI (ground fault interrupter) outlets that are installed in locations where there’s a risk of the power source coming into contact with moisture--something to save you if you drop your hair dryer into a sink full of water. A GFI breaker that will not reset indicates that the protection it is meant to provide has been compromised. 5. Heating: Most older apartments have centrally-controlled steam heat with no thermostat to adjust temperatures in individual apartments. In order to lower the heat, residents may have disabled one or more of their radiators using non-standard means, i.e. turning it off by hand. Over-tightening the radiator supply valve can damage it, as can capping the radiator or baseboard supply pipe. Reversing these issues can sometimes be expensive, depending on the damage. 6. Flooring: Your inspector should pay close attention to the flooring -- especially if it’s hardwood --to make sure that there are no excessive gaps and/or buckling and that the installation is in line with industry standards. Areas where the wood flooring has been patched may indicate a leak, such as near a radiator. 7. Installation of appliances: It’s important to ensure that appliances are correctly installed and anchored. While these issues aren’t typically costly to fix, it’s important to make note of them, so that further down the line, appliances don’t become lose, which can cause damage to them or surrounding kitchen fixtures like countertops and cabinets. 8. Common Areas: Getting access for your home inspector to inspect at the roof, basement, and building mechanicals can sometimes be tricky. If large buildings don’t let you look, it’s usually not a big worry, but, with smaller buildings, access is far more important. Access to the common areas should always be sorted out before the inspector arrives on site. Your agent should help coordinate this with the seller’s agent when scheduling the inspection. For more information, check out one of our go-to inspector's websites, which offers additional information and tips about the home inspection process. #FAQ #BlogPosts

"Highest and best," also known as a bidding war often strikes fear into the hearts of buyers who feel like they are unprepared for a battle royale. In reality, highest and best is a fair solution to the lopsided supply and demand realities of a competitive market. Rather than pitting buyers against each other by negotiating with multiple parties simultaneously leading to prices rising out of sheer frenzy, highest and best is a way for buyers to make an offer they feel comfortable making and leveling the playing field. In any properly priced sale, it is common in a market like New York for the seller to receive multiple offers. However, trying to negotiate with buyers ultimately plays one offer against others and can falsely drive up the final sale price to something the final buyer feels is not fair. If buyer A offers asking, the only way to negotiate with buyer B is to say go above ask, now that's the new number, and Buyer C or Buyer A have to match or exceed that, it becomes an endless loop that leaves buyers frustrated and puts most seller's agents in a very awkward situation. Highest and best eliminates this risk, so that when the final offer is accepted, all parties feel more satisfied with the outcome – the buyer who has come out on top still feels like they have gotten a good price for the home, the seller feels like they have gotten the best offer available to them, and buyers who did not come out on top feel more accepting of the situation, since a higher offer would not have been possible or comfortable for them. Like any blind bidding situation, research and knowledge of the market can help structure an offer, but at the end of the day, it's a personal decision for the buyer. Overall, it is certainly not something to be nervous about. It is, however, incredibly beneficial during this kind of bidding process to work with an experienced and deal savvy agent who can help you frame your offer in a way that ensures it is the best possible given your goals, assets, and finances.Here are tips to navigate a bidding war: 1.) Find out as much as possible about the competition. If the first open house is mobbed, chances are there will be multiple offers within the next couple days. A buyer’s agent can probe for information about interest and the bidding timeline, and may even gain some insight on where the initial offers are. Note that the usefulness of this information will be limited since seller’s agents won’t actually know what to expect until the “highest and best” deadline. 2.) What other terms are important to the seller? Sellers care about more than just price. For example, accommodating a seller’s preferred closing or move-out date could add value to an offer. 3.) Write a letter to the owners. For a seller who has spent a long time in an apartment or has lovingly renovated it, knowing that someone will appreciate and care for their home can be an emotional factor. An effective letter won’t mean an offer will necessarily be accepted over a higher or better offer, but if it’s a close call, a sincere letter might tip the scales. 4.) Have your agent prepare a thorough offer packet. A thorough and professional offer package that anticipates and addresses any questions not only signals that a buyer is serious and ready to move forward, but also that the buyer’s agent will move the process along efficiently. A sloppy package that lacks critical information creates doubts as to whether a buyer can actually complete the transaction, and at the very least, usually means more headaches for the seller’s agent who would likely prefer to work with an experienced colleague on a smooth transaction. 5.) Consider your contingencies. To win a bidding war, buyers don’t necessarily need to be all-cash or waive their financing contingency. An experienced agent can advise on ways to structure the offer that can level the playing field without compromising their financial position. 6.) Picking the right number. Finally, the most stressful part: picking an actual offer amount. No one has a crystal ball to predict how high the price will go, so it is imperative that the buyer be comfortable with their “highest and best” offer — whether they win or lose. A buyer’s agent can provide color on comparables or how similar listings performed, but ultimately, whether a buyer goes 2% or 10% over ask, or not at all, is a personal decision. I tell my buyers that they should pick a number where if they lose, they won’t wish they had offered more, and conversely, if they win, won’t feel they overpaid. Though bidding wars have become less common from their heyday (roughly 2013-2016 where most properties, especially in Brooklyn, received multiple offers and went as high as 10% over-ask), even in our current market, special properties that are priced right will garner multiple offers and often sell over-ask. Bidding wars really are not as scary as the name suggests — a good agent can guide you through all of these steps, and have no regrets about the outcome. #FAQBuyer

A single city-wide Moving Day was once a tradition in New York City dating back to colonial times and lasting until after World War II. On February 1, sometimes known as "Rent Day", landlords would give notice to their tenants what the new rent would be after the end of the quarter and tenants would spend good-weather days in the early spring searching for new homes. On May 1, all leases in the city expired simultaneously, causing thousands of people to move their homes on the same day. Until World War II, the moving date of May 1, and later October 1 as well (as many people left the city during the summer and took back up residence upon their return in the fall) were the only set moving dates in New York City. Some remnants are still evident in commercial leases, which still typically run out on May 1 or October 1. While there is no longer two specific "moving days" in NYC, there is still a definite moving season. Roughly 70% of NYC residents are renters and about 65% of renters who will move this year will do so between June and August. If you are among the many scrambling to decide how, when, and where to begin your search this season, here are a few tips to help you stay competitive in a the summer rental market. 1. Act Early and Make A Plan What, when, where, why, how - make a plan that answers all of these questions while you still have time to explore your options. -Is this the year to move to a larger apartment, a new area, find your own place, find a roommate? Do you plan on getting a pet, a new job, or any other major life changes over the next year? What matters to you in your next apartment - do you want to find the ever elusive in unit washer/dryer this year? -Name your priorities - location, space, lighting, kitchen size, building amenities, doormen, elevator, new appliances, price, etc. -Do you have any flexibility with your current landlord on move-out dates? When do you need to inform your landlord of your decision to renew? Since the market moves quickly and most apartments are listed as they become available, it can hard to start your search more than 6-8 weeks before your ideal move date. However, making a plan based on your answers above, and finding a real estate agent that you trust to help advise you on your best options is always the best first step you can take, even if you are still 2-3 months out from your move. 2. Be Prepared to Apply BEFORE You Start Looking Owners and landlords vary on what they will require to apply. As a base-line set of documents, most will ask to see at least: -Proof of Employment or Verification of income: A reference letter from you employer letter, OR a CPA letter is required for almost all rentals. It may take your employer a few days or even weeks to prepare, so you should ask for this before you start looking to make sure there is no delay. Employers and CPAs are familiar with the contents, but the letter should contain position, salary, dates of employment, and contact information for a supervisor or the HR person. Other Paperwork to Have Ready: -Photo ID and Basic Application Form -Last 1-2 Years of Most RecentTax Returns -Last 1-2 Most Recent Bank Statements for all accounts, checking/saving/investment -Landlord reference letter from your current landlord stating you are a tenant in good standing (this is not always required but it is best to request one early just in case) 3. Know Your Budget Take the time to research or speak to your broker about pricing and market trends in the neighborhoods you are interested in. Unless you plan to use a guarantor, your budget will capped by your annual income which must be at least 40x the monthly rent rate of your new home. Also, don't forget about upfront fees and deposits. -As a general rule it is smart to plan that at lease signing you will need to have about 4x the monthly rent available to cover: 1 month deposit, first months rent, and application fee charged by the management of the building and a 15% broker fee. -If you are looking in to renting a condo/coop apartment there may also be additional fees from the Condo/Coop Board that you should ask your agent to confirm. 4. Be Decisive Don't second guess yourself when you find the one - the market moves at lightning speed during the summer months and in order to have all your hard work pay off, be prepared to put in an application as close to immediately after seeing an apartment as possible. With all your puzzle pieces in place, you will have a clear picture of what you are looking for, what you can afford, and will be much more likely to find and seal the deal on the best new home for you - preparation and planning will always pay off, especially when competition for apartments is high. #FAQ #BlogPosts #FAQRenting

To Airbnb, or not to Airbnb, that is the question. Before you put your home on Airbnb or buy a property with the intention of listing it for short-term rental, be sure to do your homework and consider speaking to an attorney. As a starting point, here’s a brief overview of some of the regulations and rules that come into play. Do you rent? If you are a renter, chances are your lease prohibits subletting or renting without permission from the landlord. Some landlords go even further and will explicitly prohibit tenants from doing short-term rentals and will monitor the Airbnb site to see if tenants are advertising on it. For those in rent-stabilized or rent-controlled apartments, the New York City Rent Stabilization Code prohibits tenants from making a profit by subletting their below-market-rate apartments, and illegal hosts can face hefty fines and eviction. Do you own a coop or condo? Even if the building does not explicitly prohibit Airbnb, it may be covered under the building’s bylaws, proprietary lease, or house rules (e.g. many buildings include a house rule against guests entering or staying in an apartment in the absence of the owner or tenant shareholder). Violating these rules could mean fines or even eviction. Are you subject to New York’s Multiple Dwelling Law? New York’s Multiple Dwelling Law applies to any building that houses 3 or more families, even if the host owns the entire building. This law makes it illegal to rent any private apartment for fewer than 30 days unless the host is present for the entire duration of the rental. Crackdowns on violations have increased, and merely advertising an illegal rental can lead to fines of $1,000 or more per listing. Is your house up to snuff? Would-be hosts must ensure that their homes comply with certain building codes, such as occupancy levels. Meeting these standards could be pricey. Are you subject to the hotel occupancy tax? In addition to standard income taxes, etc., you may be subject to New York’s Hotel Room Occupancy Tax. The computation and applicability of this is complex, and as with all tax-related matters, you should consult your accountant or tax professional. Airbnb can provide visitors with inexpensive short-term lodging and hosts with a healthy income stream; but on the flip side, a revolving door of strangers can be a nightmare for neighbors. With this push and pull, the future of Airbnb in New York is a bit up in the air as the city council is currently considering a bill, largely advanced by the hotel industry, that would further crack down on short-term rentals in the city. One of the real estate attorneys we work with frequently also wrote an article on this topic, and includes even more details. Check it out here. #BlogPosts

Most of us have watched enough HGTV to understand what “open kitchen” or “double vanity” means, but other terms or abbreviations used in listing descriptions may not be as familiar or obvious. If you’ve ever wondered what a “Classic 6” or “EIK” is, consider the mystery solved. Alcove An alcove is a section of a room that bumps out like the bottom of an “L.” In apartment listings, “alcove” is most frequently used to describe a dining area that is offset from the living room, or, in the case of an “alcove studio,” a sleeping area just off the side of the main area to provide some separation and privacy. Alcoves can often be walled off to create a separate room (see Junior 1 or Junior 4 below…). "Bring Your Architect" or Estate Condition Listings that say “bring your architect” or “estate condition” mean the apartment has not been renovated in a long time and is not in move-in condition. These apartments are not simply outdated; they typically require major renovations and the replacement of major systems (electrical, plumbing, etc). The asking price usually takes into account the condition of the apartment, but a proper renovation will likely cost more than the difference in price. These are best for people who want (and are willing to pay for) a customized look in a unit with good bones. Brownstone Brownstone (brown sandstone) is a building material used to clad the exterior of many buildings in the 1870s through the 1930s. Brownstone is very durable and has a distinctive look. It is also used colloquially to refer to single-family and small multi-family townhomes of a certain size and height, attached on both sides (think of the townhomes lining the blocks of Park Slope or Harlem). Casement Windows Casement windows are windows that have hinges at the side and open outward to the left or to the right, similar to the way that a door would open. Casement windows were once popular, but fell out of favor as double-hung windows became nearly ubiquitous. However, casement windows — especially steel casement windows — are a distinctive aesthetic that appeal to homebuyers seeking period accents and are even being installed in new developments. Classic 6 Six refers to the number of rooms: a living room and separate dining room, two bedrooms, a kitchen, and a spare room with adjoining small half- or full bath (historically referred to as a “maid’s room” but which can be used for many purposes such as a guest room, nursery, or study). Most Classic 6’s have two other full bathrooms and a foyer or gallery. Combination Apartment A combination apartment means that two adjacent units have been purchased and combined to create one single apartment. Apartments can either be combined vertically with the unit above or below, or horizontally with the unit to the left or right. In some cases, a portion of the hallway can also be purchased and made part of the new apartment. Combination apartments may have higher maintenance fees than a comparable apartment that was not a combination. They are usually designated by the combination of both original apartments (e.g. 7FG or 101/102). EIK or WEIK While I hate abbreviations, these refer to an eat-in (or windowed eat-in) kitchen characterized by a kitchen with enough space to have a table with chairs of any size. En Suite Bathroom “En suite” is french for “in continuation.” An en suite bathroom is a bathroom that is in continuation of the bedroom, meaning that it is attached to/inside the bedroom, and can only be accessed by going through the bedroom. An en suite bathroom can be an asset or a liability. In a home with multiple bathrooms, an en suite creates a master bedroom suite, which is a plus and expected in very high-end listings. If the en suite is the only bathroom, however, it means that guests must go through the host’s bedroom to access the bathroom. Floor-Thru A floor-thru apartment occupies the entire floor of a building. Floor-thru apartments are typically found in brownstones and townhouses. Full Service Full Service refers to the level of service provided by building staff — namely, a full-time doorman, porters, elevators, and possibly a concierge. Galley Kitchen A galley kitchen is a long and narrow kitchen with counters on either side of the central walkway. Many buyers today prefer an open kitchen layout. Some galley kitchens may be opened up into the main living space. JR-1 or Junior One A junior one is an alcove studio that has been converted to have a separate room, usually designated for sleeping or as a “bedroom.” The separate area may or may not meet the legal qualifications for a bedroom, but the apartment is often listed as having one bedroom. It is the functional equivalent of a small one-bedroom apartment. JR-4 or Junior Four A junior four is a one-bedroom apartment that has a separate alcove area that can be left as an alcove (dining area), or walled off to create a separate space (sleeping area or home office). Most agents list junior four apartments as having two bedrooms if the alcove is walled off, regardless of whether the area meets legal qualifications for a bedroom. Keyed Elevator A keyed elevator is a secure elevator that serves as the direct entrance to an apartment. As the name suggests, you need a key to use the elevator and access an apartment; guests are usually “pulled up” by the host calling the elevator to their floor when their guest has entered the elevator. Keyed elevators are often found in lofts and penthouses. Legal Bedroom Legal bedroom qualifications vary depending on city and state, but a legal bedroom in NYC must meet the following requirements (subject to some exceptions): be at least 80 SqFt with a minimum width of 8 feet and a minimum ceiling height of 8 feet (if the bedroom is in a basement, ceiling height minimum is 7 feet), have at least one window and at least two means of exit (either windows or doors), and the room cannot be used as a passage to another room. It is a common misconception that a legal bedroom must contain a closet. Prewar vs. Post War Pre-war in NYC refers to apartments built before World War II, and have a grandiose aesthetic. Think grand lobbies, hardwood floors, plaster walls, solid wood finishes, crown moulding, high ceilings, and sunken living rooms. Pre-war apartments generally have a minimum ceiling height of 9 feet. Post-war refers to apartments built after World War II which incorporate sleeker, less ornate designs and often use different materials than just plaster and solid wood. Post-war apartments often have more efficient layouts (fewer hallways and foyers), more usable square footage, and lower ceilings (usually 7.5 to 8 feet). Railroad A railroad apartment is an apartment where all the rooms lead directly into each other without a hallway, meaning you need to walk through one or more rooms to get to either end of the apartment. Similar to floor-thru apartments, railroad apartments typically run from the front of a building to the back. Virtual Doorman A video intercom system in buildings without a doorman or live-in superintendent. If the resident is not home, the system connects to an offsite operator who is able to give access to authorized delivery persons into the common hallway or a dedicated package room. It is a cost-efficient way for many buildings to ensure packages are delivered without hiring dedicated on-site staff. WBFP This stands for a wood-burning fireplace, whether currently working or not. Since 2014, there is a ban on wood-burning fireplaces in NYC, but the ban exempts existing fireplaces, so there are a finite number in the city. Non-working fireplaces can often be restored with the cost largely dependent on how many floors separate the fireplace from the chimney (roof). Are there any other terms that we’ve missed? Please let us know and we’ll update the post… And of course, feel free to reach out with any other questions related to NYC real estate. #BlogPosts