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BK Squeeze - for Brooklyn Real Estate Buyers

We want that Brooklyn housing bubble to pop!

Monday, January 31, 2005

So you think you are a motivated buyer? Check this out

This is truly an amazing story with all the plot elements - pricey real estate fantasy, international intrigue, crimes and misdemeanors, along with ruthless competitors.
How Far Would You Go for a Piece of Real Estate?

Another buyer/renter blogger crying in pain

Blogger "The Epicenter" describing the once unthinkable -- getting price out of Brooklyn. Some choice comments that I can relate to:

Epicenter: "Snotty-ass brokers who waste your fucking time...and their time by the way...thinking that showing you apartments that are three or four hundred dollars more then you wanted to spend is going to magically increase your fucking budget....and their commision."

Squeeze: Amen to that brother. I can't tell you how many times brokers will push that envelope. I am working with one broker who I have given pretty explicit details on about no 2-family listing above $725k, yet he keeps showing me listings in $850k range. He tells me "well that's just the market right now", like that little tidbit of info is going to magically swell my bank account to cover the difference. Correction: I AM THE MARKET and I have spoken

"I make a good god damn living...but this is bullshit! I feel fucking poor."
Me too, my$125k a year just isn't enough unless you are pimpin some extra wealth from mom and dad or you aren't subjugated to student loans from grad school or college. Where are these other people getting all their frickin money???

Commenters on the post: "... now I live somewhere I never even considered before- the upper east side. I found a spacious, rent stablized, dog permitting, one bedroom for $1100.00. Sure all my Brooklyn friends make fun of my new museum friendly address, but screw 'em. they pay way too much to live in the boroughs."

Squeeze: wow, I never thought I would see that scenario happen. Apparently, some of the nicer nabes do get a little more affordable when the new hotspots come along.

The Epicenter: January 2005 Archives

Friday, January 28, 2005

More great stuff from PropertyGrunt

Are you ready to buy a home? No, really, not one of those Barbie playsets, the real thing...
Property Grunt: How the magic happens. Are you ready to buy a home?

Cautionary tales for would be landlords

In case you fancy yourself being the next Ben Stiller/Drew Barrymore duo (that move came and went totally unnoticed) and be a first-time landlord, check this out (I found the link while reading Property Grunt's blog). Enjoy!

NYTimes: A Landlord's Story - Investments - Real Estate

Thursday, January 27, 2005

I am not alone

God it was getting so boring doing new posts lately (I agree, the last few have been subpar squeezie). After hearing all the bullclap about the real estate market collapsing soon, with all the same arguments being strung out, it just turned into a ring in my ears -- kind of what I would imagine college socialist party meetings to be like, same bs about getting stuck by the man and the meek shall inherit the earth ra ra sis boom bah. I don't care about that shit. I just want a damn house that won't send me into hock that is presentable to family and friends in a nabe where my wife won't risk getting mugged or worse, where I don't have to spend the bulk of my day on a train missing my kid's daylight hours. C'mon people, is that too much to ask for?

Anyway, where was I? Oh yeah, not much exciting to report. I have no recent posts on my search because it has slowed down to a drip. However, Brownstoner's new listings gave me the first excitement I have had in a long time.

Not because of the listings, mind you, but what folks have said about them -- "overpriced", "ripoff","not worth your time" (I am paraphrasing here). It's nice to see that there are enough folks out there feeling the same way as me, so I know I haven't completely lost my mind. It just goes to show you, bubbles come and go, but pessimism is forever baby!

brownstoner

Wednesday, January 26, 2005

Newlyweds Buying Their First Apartment in New York

New York Magazine Columnist Amy Sohn brings in da bids and brings in da anxiety. And I thought I was going nuts looking for a place.
Newlyweds Buying Their First Apartment in New York -- Amy Sohn

The trap of interest-only and no-documentation "stated-income" mortgages

This is a great article from Newsday that spells out the risks of these loans and how much your payments can go up (e.g., 50-70%) and when (3 to 5 years or however long the intro rate period is). They cite an example of a $350k loan -- a 3/1 30-year hybrid loan at a 4% intro rate that becomes variable after 36 months. Initially payments start out at $1167 but by month 37, it becomes $2184 and by year 10 could be $2700. Of course, this may be a manageable risk, particularly if you the initial payment is well below what you can pay and you think your income will rise within that 10 years to cover higher rates (or to refinance when rates go low again).

I've considered 5/1 and 7/1 adjustable rate mortgages because that is how long I would probably stay in many of the piece o crap starter homes I've been seeing. That lower rate is just so tempting.

New York City - Real Estate

Tuesday, January 25, 2005

Will mortgage rates go up? You're guess is probably as good as the NY Post

New York Post Online Edition: business

set speed: Bad news for Ft. Greene/Clinton Hill C train users

If my commute on the F train today was any indication, the next few years will be tough for anyone on that line too.

set speed: Bad news for Ft. Greene/Clinton Hill C train users

Sunday, January 23, 2005

Need bubble talk?

As I have gotten more schooled on housing market talk, it was interesting for me to post more stuff here on housing bubbles. However, each side is starting to sound to me like a broken record and I haven't seen any discernible change in favor of either side over the past six months. That said, I now let the Housing Bubbble blog focus on that talk. I recommend buyers check there if they want to get schooled.

Housing Bubble

Saturday, January 22, 2005

30-year rates not going up anytime soon

New York Post Online Edition: Real Estate Page 43�Rates made easy

Midwood Victorians and "Creative" Financing

My Ford Taurus wagon rolled to a stop in front of the house of my wife's work colleague. It was this past Thursday night and we were dipping our tired cynical toes into the waters of Brooklyn real estate.

Mrs. Squeeze's colleague (we'll call her Nancy) showed us a rather nice sized house in her Midwood nabe that was a round the corner. The owner moved to California and wanted to offload it by himself after having two closings fall through. The house had some great details like carved oak trim around the windows and doors, stained glass windows, a front porch and a winding staircase. The third floor had an illegal 1 BR rental and the rest of the house had 4 BR's and 3 baths, plus driveway and yard.

It had once been MaryKayed with a listing at $839k, which the owner admitted was outrageous. We both acknowledge he could get high $700k's but once again, that stumbles well over what I reasonably could do, which is around $700,000. As I talked with him today (he was touring a volcanoe in Hawaii while I was shut in with two feet of snow coming in to the City), I was despondent as usual.

I tweaked my spreadsheet, thinking how I could get my net monthly expenses to around $2,200 with a $750k offer, $70k down, a 5.5% loan, a $1200 rental on the third floor and $3k a year in taxes. My spreadsheet is such a grounding thing for me. I am such an Excel geek that I have net monthly payments set up for an array of different interest rates. At 5.5%, I am paying a $2,500 net each month. However, at 4%, I am paying $1900 a month net. Big difference, but Squeezie how are you going to get a 4% loan?

How about seller financing? With the seller taking on the mortgage at 4%, it could be possible. The biggest risk though is getting him to agree. He's not getting his money out anytime soon. Still, I might just see. What have I got to lose in asking.

Monday, January 17, 2005

Want to gentrify a neighborhood? Just add indy theater space

New York's Premier Alternative Newspaper. Arts, Music, Food, Movies and Opinion

Mary Kay's $4 million dollar prize

Initially listed in the fall of last year, the 20-room Victorian mansion on Albemarle Road is getting a lot of press, but not any bids, or at least any close to $4 million.

I don't deny that the house isn't gorgeous. I've seen it several times outside and once on the inside and it would be the kind of place where a family could live in a John Hughes style fantasy domestic world. The problem is, I don't know of anyone looking in Brooklyn who has that kind of scratch. It also needs some work here and there (roof for one), but it is not a fixer upper by any stretch. This house gets my vote for "white elephant" of the year. I am guessing it will still be on the market this time next year.

New York City - Real Estate

Want a cheap place? Move to Lima, Ohio

National Association of Home Builders

Sunday, January 16, 2005

Two Bedroom Bliss

So Squeezie baby, you say, you are always harping on the cost of Brooklyn real estate. Have you seen any good deals out there? Well, the answer is yes, but not for me.

Anyone who is truly in the market for a two bedroom is in luck. Maybe you are single and want a place of your own. Or, you are two DINK's (double income no kids) and used the extra bedroom to store your endless reserves of crap, inlaws, and S&M obsessions there. Maybe you only have one child and an appointment to get those tubes tied next week. Heck, you could have six kids and a secret desire to let them know what it feels like to be raised in a closet (if that's the case, I don't want to know any more, please).

Whatever your reason, deals are to be had outside of the hot or established areas -- don't look at Carroll Gardens, Brooklyn Heights, Prospect Heights, Ft Greene, or the Slope. Do look at more underexposed areas like Sunset Park, Kensington, Ditmas Park, and Bay Ridge. Heck even Windsor Terrace has a few affordable 2 BR's if you go past Prospect Park Southwest. Expect to pay from $250k to $450k in many of these areas. Manhattan is within 30-45 minutes away, hotter nabes are a few rides away, the locals won't scare you off, and the areas are relatively clean and free of urban blight.

Kensington: Pros -- in many cases can give you close access to Prospect Park. Cons: Many of the 2 BR apartments I have seen listed are under 1,000 sq ft.

Bay Ridge: Pros -- lots of well kept 2 BR's with decent size (1200 sq ft with formal dining rooms); A very safe and clean area with an eclectic ethnic mix that keeps the commercial districts lively -- Italians, Arabs, Irish, Chinese, and Scandanavians (the highest concentration of them in the city in fact, since the 19th Century).
Cons: Travel time to manhattan can reach an hour on the R train, though there is supposedly an R express now at select stops; Parking is a nightmare in some spots; Last, Bay Ridge is a big area, so there are some so-so areas. Areas in the 60's around Colonial Road are nice as is the area around the Verranzano Narrows.

Sunday Times Roundup -January 14th, 2005

Sunday Times Roundup -January 14th, 2005
From the Sunday NY Times's "Residential Sales Around the Region" section

Percentage of properties listed that sold below asking price
January 14: 74%
Jan 9: 71%

The New York Times > Real Estate > Image > Real Estate Sales Around the Region

Saturday, January 15, 2005

The NY Post: the only 50-cent paper catering to millionaires

Can somebody please tell why the Post's Saturday real estate section focuses so much on multi-million dollar apartments. I mean really, who cares that Alan Alda just sold some land out in the Hamptons, or that some bozo is moving to a $5.4 million place next to Carolyn Kennedy. How is that germane to my life?

J-E-T-S lose lose lose

OK. So I didn't get out to North Valley Stream today to check out houses, stuck in the house with a nasty head cold. Watching the JETS, the only professional sports team that has my loyalty, choke away a victory. Paul Hackett should be strung up on a lamppost. If he was ever in a touch football game on the street, and he called a draw play on third down while I was on defense, I would personally shove him to the pavement....

Phew...Got that out of my system. Now back to your regularly schedule ranting.

Friday, January 14, 2005

Tree's Lounge is calling

Did you ever see that Steve Buscemi movie "Tree's Lounge"? You know, he plays a guy who drives an ice cream truck on Long Island and falls into a heavy state of drunken malaise by the movie's end (C'mon it was an indy, what were you expecting). Every time I think of the possibility of living on Long Island, that movie comes into my head

It's not really fair, though. Mrs. Squeeze is from Suffolk County (south shore) and there are some great things about it. The commute is not one of them. When she popped out baby squeeze, we shacked up at Casa De La Inlaws for a few months. It was heaven -- three squares, laundry done, a clean place. Like white collar prison, but with cable and a 70-year old woman reminding you everyday how fat you are getting.

Truth be told, I loved it. The commute though from midtown east where I work was ridiculous - 1.5 hours on a good day door to door, 2 hrs on a bad one. I began to feel like I saw the pretzel guy in penn station more than my wife and offspring.

A work colleague of mine mentioned that she lived in North Valley Stream. The houses aren't connecticut estates, but aren't shabby. The prices look good even with taxes. Best of all door to door is 45 minutes (my colleague takes the 7 train to LI city and gets on the LIRR at Hunter's Pt). I am keeping an open mind. I figure that if I am looking at places in Flatbush where guys are peeing on the stoop, how bad can Nassau county be? More details when I come back tomorrow.

Need a place? Become Homeless

Life on the Inside

Wednesday, January 12, 2005

Rentals still cheaper than buying, even for the wealthy

It just goes to show you, the higher you go up the food chain, the more dizzying the numbers get, and real estate is no exception. An interviewee in New York Magazine comments on how the rent vs. buy decision for luxry rentals favors rentals:
"At the Grand Tier, the monthly rent for a four-bedroom duplex is $35,000. Buying a comparable place could cost up to $12 million, and—with a smallish down payment—a mortgage in that range can approach $70,000 a month. Crazy as it sounds, it’s cheaper to rent, at least for a while."

Wow. And my rent vs buy comparisons were under $500 (in favor of rentals, of course).

The $35,000-a-Month Rental - Ron Allen and Adaora Udoji's Upper West Side Apartment - Renovations Up Apartment Prices

Tuesday, January 11, 2005

The Glory Days of 2002

Ah, the quaint year of 2002. It feels so long ago but I remember it well. I had just gotten a new gig, baby squeeze was on the way and row houses in Prospect Heights would only fetch you $363 to $400k. Blogger set speed digs up on this skinny. Weren't hot dogs a nickel too back then?

set speed: The outlook for Prospect Heights circa 2002

Medieval Brownstone in Clinton Hill

OK, so it's gotten a little slow in the Squeeze household with the missus watching bad TV and baby squeeze still up. I have no new rantings, but I thought this story of a building that came with a "Doby the House Elf" was too good to pass on.

webfartan: Four Story Brownstone - Serf Included!

Amateur Real Estate Expert's Blog Advice on Buying in a Bubble: buy carefully

Oh and don't buy high. Oh and if your monthly housing nut exceeds your income, don't worry its all tax deductible.

KA Version 3.0: Buying Real Estate | 01.06.05

Monday, January 10, 2005

Has Greenspan Over-Pumped the Real Estate Bubble?

The Housing Bubble Blog pontificates on Greenspan's second great mistake, making first-time baby boomer real estate investors ride a negative cash flow situation in hopes of flipping it rich.

Housing Bubble: Has Greenspan Over-Pumped the Real Estate Bubble?

Morgan Stanley to the Fed: Game Over

Industry Contrarian Stephen Roach, reviews the forces at work that are tying the hands of the Fed and putting a prick into the US Housing Bubble.

Morgan Stanley

Sunday, January 09, 2005

Sunday Times Roundup -January 9th, 2005

From the Sunday NY Times's "Residential Sales Around the Region" section

Percentage of properties listed that sold below asking price
Jan 9: 71%
Dec 26: 54%





The New York Times > Real Estate > Image

Biggy Smalls' Hood Grows Up

It all started with that damn Strokes guitarist.

The New York Times > Real Estate > Living In | Clinton Hill: Into the Big Leagues, With Prices to Match

Student Loans v Mortgage Payments

Here's an interesting thread on Craigslist about whether someone should keep their student loan debt or take on more mortgage debt to buy a place

Housing Forum - new york forums - craigslist

Friday, January 07, 2005

Interest Rates are not the reason for Rising Brooklyn Prices

I always love hearing from industry pundits how interest rates are driving up home prices. Do not believe this. This is incorrect and is either a pat answer or is a grossly misinformed one.

Prices in several Brooklyn nabes have risen 40-50% in 2004. Looking at 30-yr fixed rates in New York over the past 12 months, 30-yr rates reached a high of 6% in May and then dipped to 5.3% in December. If we buy into conventional wisdom, we're expected to think that this drive down in interest rates spurred the bulk of the price gains, right?

OK, so I will go with that logic, but even with that, this 3/4th of a point shift in interest rates, holding all other things equal, would only enable buyers to spend 9% more on a house. So what gives?

Housing Bulls would argue that supply is driving up price

Housing Bears would argue that these gains are being driven by speculation

Any thoughts? I'd love comments.

Tuesday, January 04, 2005

Loathsome Real Estate Broker snagged on Gawker

Gawker: "Broker Celebrates The Life-Crushing Real Estate Bubble

"Happy New Year from the most important person in your life, your loathsome real estate broker! A reader forwards a well-wishing email from 'some crap NYC real estate broker' (with an impressive mastery of ellipses) that has us feeling all fuzzy:
Just a little note to thank all of you for entrusting me with your real estate purchases and sales during 2004. For your information, average Manhattan prices climbed 56 percent from a year ago! It has been an incredible year and I expect 2005 to be another good year for real estate ...
I look forward to be of further assistance during 2005. Don't hesitate to call or to refer your friends. I am here to help!
Meanwhile, I am enclosing my latest listing ... a wonderful triplex penthouse in SoHo/Greenwich Village ... 3,000 square feet of interior space and 1,200 square feet of outdoor space ... with a private 2-car garage ...
While I wish you all a very Happy New Year, let us hope for a year of global peace and quick recovery for Tsunami victims.
[redacted]
Associate Broker
Sotheby's International Realty
Smart! Invoking the memory of tsunami victims makes that $1 million efficiency seem a little more palatable."

FT Greene prices increased 35% last year

"Sellers enjoyed price increases in the boroughs outside Manhattan, too. Average sales prices in Fort Greene, Brooklyn, increased 35 percent in this year compared with 2003, according to the Corcoran report.

Fort Greene "has been infiltrated at an unprecedented level" by buyers and developers from Manhattan, said Jerry Minsky, a Corcoran broker. Mr. Minsky said that in December he helped to sell 18 apartments, including a $1.2 million penthouse, in the GreeneHouse, a luxury condo in Fort Greene. Prices, which started at $600 per square foot, increased to $845 per square foot by the end of the month. Mr. Minsky said he also sold a three-family brownstone town house for $2.15 million in December. He said he believed that this was the first sale of a private residence in Fort Greene for more than $2 million."



The New York Times > New York Region > Average Manhattan Apartment Remains Over $1 Million

NYC Residential Prices Falling? Ha ha ha ha ha ha ha ha ha!!!!

Mmmmmmhmmmm...my evil plan is coming to fruition!

New York Post Online Edition: business