Thursday, December 30, 2010

Luxury residential property, flats in New York


Luxury residential property and flats in New York are in demand by global investors because of the stability of New York residential property and relative value globally.  While Manhattan is the most expensive market in the US, it's a lowly #10 globally in terms of price.

Foreign investors interested in luxury New York property/flats should consider the three points below:

1.  Select a good agent to filter the flats/property.  You can't rely on your own web search of properties from thousands of miles away.  In the US, agents have access to a database which means as long as they are part of the property trade association, they have access to all properties on the market.

2.  Learn about issues such as taxation.  This can be through the right lawyer and accountant that your broker could recommend.

Residential property, flat price trend New York

Residential property (flat) price trend above shows stability of flat price in New York even during the 2009 economic crisis.  During the 2009 downturn, the average property price in the US decreased by 35 percent.  However, the average flat/residential property in New York decreased by about 20 percent.  Manhattan New York has since rebounded from the low of 2009.

The average price of a residential flat in New York is $1095 per sq ft as of Q3 2010.

Visit us at Castle Avenue Partners - Manhattan investment property
 

Saturday, December 25, 2010

Hong Kong vs New York Property


Hong Kong vs New York property

Price appreciation:
New York is a stable, 10% per year average appreciation while Hong Kong can go up or down 40% a year.  New York is safe, Hong Kong provides more adrenalin.  Don't buy in New York and expect to flip in 2 years.  One should have expectation to hold at least 3-5 years.

How to select New York property agent


Manhattan, New York property agent - investment from Weimin Tan on Vimeo.

How to Select a New York Property Agent

Until 2 years ago, I was an active property buyer in multiple cities.  A challenging issue was selecting the right property agent.  A referral helps dramatically but even so, there may not be a fit. 

Friday, December 24, 2010

Hong Kong, China buyers investing in Manhattan

I'm currently writing from Midlevels in Hong Kong, enjoying the cool winter weather on Christmas day.  Some property notes when comparing Hong Kong/China vs New York.  

- South China Morning Post reported that Beijing, China appreciated the most last year, 40%.  Hong Kong 17%, Manhattan 10%, London 20%.

Sunday, December 19, 2010

Manhattan median price growth #1 in nation

alternate text

Manhattan, New York is #1 in the US for median home price growth from 2005 - 2009.  The median value jumped by $350,600 per home between 2005 and 2009 to $800,400, an increase of 78 percent.  This works out to an average of 15.5% per year.   


Visit us at Castle-Avenue.com - Manhattan investment property

Commercial real estate outlook



Commercial recovery on the way
1.  Economic Expansion - US adding 1.2 m private sector jobs
2.  There's no firesale for quality assets
3.  Low interest rates.  Historically high 480bps spread.  This is the difference between property cap rate (currently 8% US avg) to the 10 year Treasury which is the benchmark for property returns.  Strong signal to buy.
4.  Apartments are a safe bet, followed by retail but higher risk.  And hotels will definitely pick up!


Visit our website  Castle Avenue Partners - Manhattan investment property

Friday, December 17, 2010

Roubini buys $5m Manhattan condo

Roubini Buys $5m Manhattan penthouse condo (Curbed)

Nouriel Roubini (Dr Doom) is perhaps the most bearish economist of all.  Predicted housing fall in 2006 and now world famous.  Said US will have double dip etc etc...

Anyway, he just bought a $5m Manhattan penthouse condo!

Tax Bill - what it is


(Reuters) - Congress approved an $858 billion tax deal between President Barack Obama and the Republicans that will boost the economy but add to the budget deficit.

Following are key components of the bill. All cost estimates are from the congressional Joint Committee

Sunday, December 12, 2010

World's Most Expensive Property Markets













In my prior blog post, Manhattan is the #1 ranked world's best property market as ranked by Citi Private Bank and Knight Frank.  In terms of the most expensive property markets in the world, Manhattan New York is ranked a lowly #10 as the table above shows.

Hence, Manhattan is the world's best property market and yet ranked only #10 in terms of price.  That makes it a good value, doesn't it?

Visit us at Castle Avenue Partners - Manhattan investment property

World's Best Property Markets


Citi Private Bank and Knight Frank ranked Manhattan, New York the world's best property market out of the top 50 global cities.  Based on the four factors as shown above - economic activity, political power, knowledge and influence, quality of life.    

Saturday, December 11, 2010

China over-dependent on property, no demand



Quite a long video.  Summary:
1.  60% of China's GDP driven by real estate construction.
2.  They are building property at US prices that people can't afford, sitting empty.
3.  Consumption is only 5% of GDP

Bottom line - China is over-reliant on construction which has no demand.  Problem........

Friday, December 10, 2010

Frank Gehry, Beekman Tower at 8 Spruce Street


Who is Frank O Gehry?  What’s up with this guy and his organically shaped Beekman Tower just south of City Hall or the sweeping curves of the IAC Headquarters Building in Chelsea?  Does he just take a piece of paper, crumble it up, stand it on end and say “there it is”?

Saturday, December 4, 2010

Risks, disadvantages, problems Manhattan New York property



Here are the downsides - risks, disadvantages, concerns, problems - associated with owning property in Manhattan, New York.

1.  Tying up capital, at least $150K for an entry level studio to millions for buildings.

2.  Don't expect to flip in 2 years.  Manhattan doesn't appreciate 30-40% per year.  It's not an emerging market.  You should expect to hold for 5 years.

3.  Vacancy is expensive because of carrying cost, repainting and repairing this and that, broker fees associated with re-marketing.

4.  Get a good tenant by doing the proper reference checks.  In New York City, eviction will be time consuming and expensive.

Our website Castle Avenue Partners, Manhattan investment property

Tuesday, November 30, 2010

New York Property Agent



Weimin Tan, New York property agent, brings client See Chan to view 2BR condos.  Featured on Manhattan's #1 real estate show, Open House NYC.  Weimin is originally from Asia and speaks English, Cantonese Chinese, Malay and conversational Mandarin Chinese.  He is a specialist with high net worth foreign / international investors  interested in Manhattan property.

New York Housing Statistics

Manhattan New York Housing Statistics

Chart below summarizes the historical performance of Manhattan, New York property.  From 1997 through 3Q'10, Manhattan residential housing prices increased from $328 per square foot to $1095psf.  This is an average of about 10 percent per year.  Compared to the Dow Jones which appreciated an average 2% per year during the same period.


New York Property Market

Manhattan, New York Property Market 3Q'10

If you are still looking to get a "deal," the market bottom for Manhattan, New York property is over.  About one year too late.  We're in the midst of an upwave.  Manhattan, New York's 3Q'10 average price per square foot is still lower than in 2007 and the peak of 2008.  But it has recovered from the low in 2009.  

Thursday, November 25, 2010

Manhattan #1 city for renting


MSNBC ranks Manhattan as the #1 city to continue renting.  At average apartment price of $1.8 million, it takes 35 years of renting to cover homeownership expenses.

Supply vs demand


Jonathan Miller, analytical guru and CNBC regular, says that looking at sales transactions is only half the story of a market's performance.  One should look at the absorption rate because it tells the whole supply vs demand story.

Saturday, November 20, 2010

Foreclosure and Manhattan

1.  In Manhattan, residential foreclosure rate is almost non existent.  Even if there are foreclosures, the properties would still get close to market price because of demand and market efficiency.  

Thursday, November 4, 2010

Real Deal reports on Hotel Azure for sale at $29 million

Real Deal reports on Hotel Azure for sale at $29 million

The Real Deal, New York's top real estate magazine, reported on our listing, $29 million Hotel Azure.  The property includes a 28 room hotel and 10 retail spaces.

Friday, October 15, 2010

Famous buildings and architects in Manhattan

Interesting article from AMNew York, "Rise of Starchitecture."


In the mind of Rick Bell, the executive director of the American Institute of Architects’ New York chapter, all his fellow architects are stars.
It goes without saying, however, that the firmament on Gotham’s streets and skyline has gotten a lot brighter. As uncomfortable as architects may be with the term "starchitect," the word fittingly describes design masters who create buildings that “capture the imagination” and are simply superlative, Bell said.
Of course, New York historically has had no shortage of blockbuster stars: Frank Lloyd Wright and his Guggenheim Museum and Philip Johnson and his AT&T skyline “highboy” are among many examples. Multiple forces, however, converged to give rise to the ‘starchitect’ in the modern sense, observers told amNewYork.

Friday, September 24, 2010

New York hotel for sale in prime Canal Street / Lafayette Street


For Sale:  
28-Room Hotel with Significant Retail in top Manhattan, New York location.  Canal Street / Lafayette St in Chinatown/Soho neighborhood.  $29 million, 7% cap rate.

Sunday, September 19, 2010

The Hunt: Chinatown with Wei Min Tan, Open House NYC




Weimin Tan brings client to view 2 bedroom condos in Tribeca and Financial District.  Weimin is a specialist with international / foreign investors looking to invest in Manhattan apartments and buildings.  He speaks Cantonese Chinese, Malay and Mandarin Chinese.

Sunday, September 5, 2010

New York City 2010 Facts

City Facts Graph
This recession, NYC lost 4.8% of jobs, less than US avg of 7.3%

Wall Street Profits

City Facts Graph

NYSE member firms achieved record profits in 2009 after posting $50B in losses during the past 2 years.

Saturday, September 4, 2010

Why buy Manhattan Property with a Broker

1.  Commission:
The commission is a pre-negotiated amount paid by the seller.  If a buyer has a broker, it's split 50/50 between the seller's and buyer's brokers.  Else, the seller's broker keeps it all.  There is no "discount" by going directly.

Friday, September 3, 2010

Manhattan vs US property market

[NYBORO]
Manhattan outperforms US housing market - WSJ article
Home Market:  Lots of Looking (link to Wall Street Journal article)


1.  New York City outperforms rest of the US housing market this summer.  Prices rising, employment grows.


Friday, August 20, 2010

Mortgage tax on refinance, New York


Refinancing is the hot topic these days with interest rates at a record low of 4.5%.  The cost benefit analysis is the lower monthly payments vs transactions costs.  With transaction costs, mortgage tax is a huge component.

Friday, July 16, 2010

Midtown East: Blue-Chip Manhattan Neighborhood


Midtown East:  Blue Chip Manhattan Neighborhood
My article as published in TheStreet.com 7/16/10.

NEW YORK (TheStreet ) -- Manhattan, New York's Midtown East neighborhood has some of the largest concentration of Fortune 500 offices, highest real estate prices and fanciest retail shops in the world.

Thursday, July 15, 2010

New York Property Outlook


Excerpts from radio interview with CBS's The Political Chick on 7/12/10:

New York (Manhattan) property outlook
- Bottom is over and Manhattan, New York property market should see steady increase.  Not V but gradual increase.
- Wall Street is rehiring again.  In 2009, Wall Street made record $61 billion.
- Impact of the first time homebuyer credit is minimal to Manhattan buyers because the median price in Manhattan is $900,000.  The impact is higher for the US average home which is only $200,000.
- Foreigners and buyers are coming back into the market.  This reflected in 2Q'10 transactions increasing 80% and median price increasing 7.6%.
- Do not expect double dip in New York property market because of the above reasons.

Saturday, July 3, 2010

New York Apartment prices



New York apartment prices (condo) as of second quarter, 2010.  Condo apartment prices increased 3% vs last quarter and 10% vs last year.  Transactions surged 90% vs last year.  
Studio             $444,000
1 bedroom      $687,000
2 bedroom      $1.35 million
3 bedroom      $2.7 million
4 bedroom+    $ 5.8 million


We serve international, foreign investors interested in buying Manhattan, New York apartments.  Our team is very familiar with financing and tax issues, primary concerns of foreign buyers.    


Our Youtube video on New York Apartment Prices 
Castle Avenue Partners - New York Apartment Overview 

Data:  Miller Samuel Appraisers

Thursday, July 1, 2010

2Q Manhattan Property Prices, Sales Up

Manhattan Property Prices, Sales Up (link)
Just published in TheStreet.com.
- Manhattan property showed positive signs by all metrics.
- Prices up, transactions surged, days on market declined.
- Median price still 13 percent lower than peak reached in 2008.
- Expect gradual increase, rather than V shaped spike, moving forward.

World's Most Expensive Cities 2010

New York, America's only city in the ranking, is ranked 29 out of 32 cities.  The $40 lunch and $12 movie tickets aren't that bad after all.
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1. Tokyo, Japan
2. Oslo, Norway
3. Luanda, Angola
4. Nagoya, Japan
5. Yokohama, Japan
6. Stavanger, Norway
7. Kobe, Japan
8. Copenhagen, Denmark
9. Geneva, Switzerland
10.  Zurich, Switzerland

Wednesday, June 23, 2010

Manhattan Real Estate: Good Value vs. Top Global Cities

Manhattan Real Estate: Good Value vs. Top Global Cities

My article on TheStreet.com, 6/23/10. Manhattan, the world's financial capital and #1 ranked real estate market, is only ranked 10th in terms of property prices.  Factoring in the good rental yield makes Manhattan a value buy vs top global cities.

Youtube video:  New York apartment - Value Buy

Saturday, May 29, 2010

Manhattan Townhouse Renovations - 4 design strategies


Manhattan Townhouse Renovations - Classic Architecture, Contemporary Design
By: Darren China, R.A.
Manhattan townhouses exude a charm that other dwellings just cannot compare with. These four to six story structures built in the late 19th and early 20th century afford privacy hard to come by in New York City.  They typically include an eat-in kitchen, private back yard often with a garden, large living spaces and a classic d├ęcor inclusive of a beautiful stairway, inlayed wood floors, crown moldings and multiple marble mantled fire places. Unfortunately time has often taken its toll on these beautiful buildings.

Mortgage rate historical lows

Mortgage rate at historical lows since tracking started 36 years ago.  Currently at 4.85% for 30 year fixed.

Friday, May 28, 2010

NYC area sales + 39%

Told you the bottom was over.  For Manhattan, it was in Q4 2009.  WSJ: Strong Market Pumps Up Home Sales

Friday, May 21, 2010

Silverstein on WTC

Silverstein on WTC 2.0 - CNBC.com

Silvestein talks about development of the WTC site.

I'll Take Fifth Avenue, Too

I'll take Fifth Avenue, Too.
Article as published in Thestreet.com 5/21/10

Take advantage of the recession, and snap up a Fifth Avenue apartment in New York. That's a common goal among many of our high net-worth clients, especially during the past year. So what is Fifth Avenue and why is it so coveted?

Wednesday, May 19, 2010

Monte Carlo, Monaco - most expensive real estate in the world




Monaco is the most expensive real estate market in the world at an average of  US$5000 per sq ft.  This compared to Manhattan at US$1000 psf, which is a deal.

Saturday, April 17, 2010

Mortgage Interest Tax Deduction


Article in Yahoo Finance talks about the mortgage interest tax deduction as America's costliest tax break.  This includes mortgage interest and home equity line of credit interest that is secured by a home.  Says this is sacred and politicians are not touching it amid efforts to raise tax revenue for the US.

Friday, April 9, 2010

Rent Stabilization owner info

Rent stabilization articles that New York City owners and landlords may need

Thursday, April 8, 2010

World's Best Property Markets

World's Best Property Markets

The recent Wealth Report 2010 on high end residential property by Knight Frank and Citi Private Bank ranks the world's top property markets as follows.  The ranking is based on economic activity, political power, knowledge & influence and quality of life.

Tuesday, April 6, 2010

Manhattan Apartment Market Statistics


Below is summary of the first quarter Manhattan apartment market statistics with focus on condo apartments.

Sunday, April 4, 2010

Manhattan Property Growth Factors

Manhattan property outperformed the stock market from 1997 to 2009, returning an average 10 percent per year compared to the Dow's 2%.  Here are the top Manhattan property growth factors for the coming 10 years as mentioned by the Property Wealth Report.

Saturday, April 3, 2010

Manhattan Apartments Q1 2010

Manhattan New York apartment reports for first quarter 2010 is out.  As I've predicted since 4 months ago, the report shows that prices declined while sales jumped.

Wednesday, March 24, 2010

Global Wealth Report 2010

Knight Frank / Citi Private Bank Global Wealth Report
"A global perspective on prime residential property and wealth"

Summary points of the report produced by London-based Knight Frank and Citi Private Bank.  The full report is at the link above:

* High Net Worth Individuals (HNWIs) globally still see high end residential property as one of the best asset classes to own, predicting growth in 2010.  71% think 2010 will be a good year for property.  This is the most optimistic asset class.  Equities came in second at 68%.

Monday, March 22, 2010

7 Things New York real estate agents don't want you to know

My article as appeared on TheStreet.com today 3/22/10.  7 Things New York real estate agents don't want you to know.


Eight out of 10 people would probably say they don't like their real estate agent. I'm among the eight and would never have imagined myself being a real estate agent. Today, however, I'm a real estate agent in Manhattan, partly driven by observing opportunities from the points I'll outline here.

Monday, March 15, 2010

Manhattan Property agent

How I became a Manhattan Property Agent

Originally from Malaysia, I came to the US for undergrad and business school.  After grad school, joined Citigroup and stayed for 9 years.  Did very well and was one of the youngest VPs and was in the top 2% of managers.

During the last 3 years at Citi, I was investing in property as a principal.  Visited numerous cities and viewed thousands of properties.  It was during this time that I interacted with a LOT of property agents.  Manhattan property agents and property agents in other states.  The interactions with Manhattan property agents can be summarized as follows:

Monday, March 8, 2010

Fifth Avenue Apartments

Fifth Avenue apartments

Take advantage of the recession and snap up a Fifth Avenue apartment.  That's a common goal amongst many high net worth clients.  So what is Fifth Avenue and why is it so coveted?


Sunday, March 7, 2010

New York Property - Bullish

New York Property - Bullish

Last year, I attended a New York property seminar where the key attraction was a panelist who is a property celebrity in New York (Manhattan).

During the panelist session, this panelist pulled out a New York property article and said she wanted to share points from an article she read about why we should be optimistic about New York property. She mentioned the points – good numbers, landlocked, demand from emerging markets and finally air quality is "pristine".  It sounded very familiar but that “pristine” quote confirmed that she was quoting my article that was published in TheStreet.com. This was confirmed after the panelist session.  Here are the points again, summarized and edited to reflect new info.

Saturday, March 6, 2010

Transaction costs New York property

Transaction costs when buying and selling a condo apartment in Manhattan, New York.  The buyer numbers assume $1 million apartment with 60% loan.  It's to keep it simple without 2 pages and 200 line items.

Capital Gains tax New York property II

Capital gains tax on Manhattan, New York property is high.  Yes it's higher than in Hong Kong, Singapore, Malaysia.  And a list of other countries.  But probably not as high as tax in many western European countries.

Financing New York Apartment

Financing New York apartment

Market analysis of financing options provided by local US banks and an international bank that is strong in international mortgages. 

Wednesday, March 3, 2010

Annual return of Manhattan apartment vs stock market

As published in Thestreet.com March 3, 2010.  Manhattan apartment annual return ROI

What's the expected return on investment (ROI) on an investment apartment in Manhattan?

Well, it's a forecast, and as a real estate broker, I never promise investor clients prices will appreciate by X percent within Y years. But what I can share is the historical trend of price appreciation on a Manhattan apartment, as this chart shows.

Saturday, February 27, 2010

Property agent fee in New York

On purchase or sale transactions:
Who pays the property agent fee?  In New York, the seller pays the agent commission or fees which is split between the seller's agent and buyer's agent. This is how it works....

Manhattan townhouse single family price premium

Curbed NY: Manhattan Townhouses and the High Price of Being Single



Great analysis from Jonathan Miller showing price premium of single family Manhattan townhouses vs multifamily townhouses.  Now, the premium likely because many multifamily townhouses are rent stabilized.

Friday, February 26, 2010

New York Property Advice


Chart above shows our way of providing New York property advice to the client.  We act as the broker and provide property advice as well as market related advice.  Further, we will coordinate the other team players for the  buyer client.  Bank that will provide financing, attorney who will handle the property closing, accountant, and as necessary, property manager.  Of course, it is up to the client to engage our suggested professionals.

New York Property ROI Return on Investment

New York property return on investment ROI

What's the expected return on investment (ROI) on Manhattan New York property?  Well it's a forecast and I will not promise buyer clients prices will appreciate by X percent within a certain period of time.  But what I can share is the historical trend of price appreciation.  Graph shows:

China's real estate market surges while New York's struggles

Examples of why China's market is about to pop.  Note per capita income in China is dramatically lower than in New York.
By the Numbers: China's real estate market surges while New York's struggles | The Real Deal | New York Real Estate News

Wednesday, February 24, 2010

New York Property Tips

This article on New York Investment Property Tips focuses on buying an apartment in Manhattan, New York. 

Tip 1:  Condo vs coop

Apartments in New York are divided into condominiums (condos) and co-operatives (co-ops).  When you buy a condo, you are buying real estate and enjoy the benefits that typically come with real estate ownership.  For example, freedom to renovate and freedom to rent out.   New York Property Tips

Average Apartment Price




Graph shows New York (Manhattan) average apartment prices of condos and coops.  The sizes are studio (no bedroom), one bedroom, two bedrooms, three bedrooms and 4+ bedrooms.

Monday, February 22, 2010

Manhattan Real Estate: Direct Ownership vs. REIT?

Article as published in Thestreet.com Feb 22, 2010.  Manhattan Property: Direct Ownership vs REITs

Here are some pros and cons to weigh if you're thinking about direct property ownership in Manhattan, such as buying an investment condo or building vs. investing in a real estate investment trust such as Boston Properties(BXP Quote), SL Green Realty(SLG Quote) or Vornado Realty Trust(VNO Quote) that own commercial properties in the area.


No. 1, Liquidity: REIT wins. REITs are liquid and can be bought or sold with the click of a mouse. That's not the case with direct ownership in a condo or building because it takes at least three months to buy or sell.

No. 2, Entry level: REIT wins

Saturday, February 20, 2010

Most Cities Still Won in Housing Boom - CNBC


Left graph looks at price increases from 2000 to peak.  Right graph looks at price decreases from peak to Oct 2009.  Most cities have a net gain.  Full article on CNBC

Thursday, February 18, 2010

Investing in New York Property - direct investment or REITs

Comparison of direct property investment (buying a condo or building) vs buying REITs (eg stocks of Boston Properties, SL Green, Vornado who own a lot of Manhattan commercial properties). 

Saturday, January 30, 2010

New York Property appreciation

New York (Manhattan) property price appreciation history from 1997 to 2009.  Average price per square foot of condo and coop apartments.  Price peak reached in Q1'2008.  Back in 1997, it was only $328 per square foot, increasing to peak of $1289 per square foot in Q1 2008.  

America's Most Overvalued Cities - CNNMoney

America's most overvalued cities - CNNMoney


New York, NY (Manhattan) is shown as one of the most undervalued cities.  This is news.


Related links:
New York Investment Property
New York Property
New York Property FAQ
New York Property Price Appreciation History
New York Property articles and media
New York investment property search
Buying New York property

Manhattan housing inventory - Wall Street Journal report

Wall Street Journal - Change in housing inventory

It's great that they are finally breaking out Manhattan from "New York" because Manhattan has very different fundamentals from New York City in terms of foreclosures and impact of the 1st time homebuyer credit.  Note the 24% decline in housing inventory for Manhattan in the chart.

New York Property

Castle Avenue focuses on New York investment property.  Specifically, investment properties such as condos, townhouses and commercial buildings.  We will help our clients identify the right property to buy, arrange management and handle the eventual sale. 

Our recommendation for your New York property purchase will include appreciation and rental potential, neighborhood growth, yield relative to stocks and bonds and tax implications. The goal is to serve as an acquisition partner to local, overseas and international clients interested in purchasing New York property. 


Related Links
Castle Avenue - New York Investment Properties
New York Property FAQ
New York Investment Property Search
Buying New York Property
New York Property Price Appreciation History

New York Times real estate page
New York Office of real property services
New York City Online Property Register

New York Investment Property

New York investment property is becoming popular especially amongst investors from China and Hong Kong.  This is partly driven by overinflated property prices in China/Hong Kong and desire to take advantage of the US downturn.

By New York investment property, I'm referring to investment properties in Manhattan, New York.  New York City is divided in Manhattan (the central business district), Brooklyn, Queens, Staten Island and Bronx.

The average asking price of a investment condo property in Manhattan, New York  is about $1200 per square foot.  Trades are usually at a discount to the asking price.  The gross rental yield is about 5 percent while the net rental yield (after common charges and tax) about 3-4 percent.

New York investment condo property are popular especially amongst international / overseas buyers because of the simplicity of ownership. Condo ownership requires minimal maintenance as the monthly common charges paid basically covers the required maintenance activities. A tenant or renter who has issues while staying at a condo can easily call the building staff to fix the issue at hand, eg leaky toilet or ineffective heater. Comparatively, if an investor owns a building, the investor needs to address issues like the roof, boiler, heater etc that may need repair.

New York investment property is an appreciation play, not a yield play.  This means the investor buys for value appreciaiton, not to expect a high rental yield. 
 
Here are links to learn more:
Buying New York Property
New York Investment Property Search
Foreign / Overseas Buyer FAQ
New York Property FAQ
New York Property Price Appreciation History
How to find good investment property - MSN
 
Are you ready to buy an investment property - WSJ
New York Investment Properties on Loopnet

Saturday, January 23, 2010

Price rent ratio November 2009 - from Calculated Risk Blog




Price rent ratio through Nov 2009 as posted on Calculated Risk.  Shows the ratio close to 1.0, which was the 2000 base year index.  It does say prices expected to drop.   Importantly, note that the ratio has decreased substantially from the peak in 2006.

In Manhattan, New York, price is about 16 to 19X annual rent.



Thursday, January 21, 2010

Summary of CBS interview with Political Chick, Lisa Chase

Summary of my interview with CBS's Lisa Chase, The Political Chick, this past Monday.  Topic was state of the residential real estate market.

* In terms of US average, prices should decrease another 10%.  Reasons include:
- glut of foreclosures in the pipeline which will decrease average prices
- expiration of the 1st time homebuyer credit
- higher interest rates as the Fed ends it's mortgage bond buying program in March 2010

* However, real estate is LOCAL and hence one should look at price trends specific to one's local market.

* The Manhattan, New York condo residential market has bottomed in real time.  For example, new development condos traded at $800 per sq ft back in Oct/Nov and then increased slightly.  Real estate market reports will take until Q1 2010 to reflect this as these reports lag 3 months (time it takes to close on a property).  The 4Q 2009 report still shows average prices at $1000 per sq ft.  From this, it's obvious that the coming report will show price declines.

* Manhattan is much less affected by foreclosures and the 1st time homebuyer credit.  I do not feel the Manhattan market will double dip.  Rather, the bottom was here and over.  Transaction volume has been surging, a key signal that the market is finding its bottom. 

* The Obama Making Homes Affordable Program was bad economics.  Should never have started.  It's just delaying the foreclosure process as most intended recipients either have incomes that are too low or own properties that are already too far underwater.

* Over the past couple months, there has been a lot of foreign interest looking to capitalize on Manhattan's downturn. 

Best,
Wei Min
Castle Avenue Partners
New York Investment Properties

Interview podcast at chataboutit.com
New York property articles and media
Buying New York Property
New York Investment Property Search


Website:  http://www.castle-avenue.com/
Blog:  http://www.wealthre.blogspot.com/

Wednesday, January 20, 2010

Asia's Most Expensive Places To Live - Forbes

Asia's Most Expensive Places To Live - Forbes

Cold Weather Chills Housing Starts - WSJ

Link to article:  Cold Weather Chills Housing Starts


Wei min's comments:

Housing starts should tumble because we are in the midst of a foreclosure glut, real estate crisis and price declines of up to 40%. Just because housing starts were a certain number last year does not mean they should be at the "run rate" this year.

We would be in bad shape if housing starts increased.

$8 million in assets and can't get a mortgage - CNNMoney

Link to article:  $8 million in assets and can't get a mortgage


Weimin's comments on the article:
Banks are super strict with really large mortgages of high net worth individuals because they can't predict these loans since these are outliers in the credit models. No point taking the risk because these are not regular customers anyway.

Also, rich people w $8m net worth don't care about their credit score, do they? What would they need a stellar score for? They have the non-cookie-cutter ways of getting financing. They are sophisticated and would walk away when it no longer makes sense to make mthly payments. Unlike regular people who feel 'obligated.'. Hence banks are right to have stricter criteria.

FHA is a recipe for disaster. They require 3.5pct down for low credit people! Downpayment is the main determinant of loan quality/foreclosure. FHA is also technically insolvent. Should just be closed down.

Tuesday, January 19, 2010

China Property Bubble

Link to article:  China Property Bubble

As posted on Bloomberg.  In Shanghai, prices up 54% through Sept 2009.
In Beijing's Chaoyang district, housing prices at $300 per square foot, is 80X annual income !
People talk about real estate riches at the dinner table, no longer about their businesses or factories.

Monday, January 18, 2010

Housing Markets Most Likely To Have Hit Bottoom

Housing Markets Most Likely To Have Hit Bottom

New York, NY is one of the 14 listed, with 18% decline from peak.  These reports are 3 months lagging because it takes 3 months to close.  Those active in the real estate market have a much better gauge than reports.  But good to know.

Saturday, January 16, 2010

New York Investment Property

New York investment property our investor clients buy are divided into condos (residential) and buildings (commercial or residential). 

Residential condos are popular especially amongst international / overseas buyers because of the simplicity of ownership.  Condo ownership requires minimal maintenance as the monthly common charges paid basically covers the required maintenance activities.  A tenant or renter who has issues while staying at a condo can easily call the building staff to fix the issue at hand, eg leaky toilet or ineffective heater.  Comparatively, if an investor owns a building, the investor needs to address issues like the roof, boiler, heater etc that may need repair.

Obviously there are advantages and disadvantages of owning a condo unit vs a building.  Here is a rough breakdown:

Condo:
Upside - ease of ownership, simple to understand
Downside - lower rate of return

Building:
Upside - higher rate of return
Downside - more management intensive, higher cost of entry

Buying New York Property - Our Services
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New York property FAQ


View New York investment properties at Castle Avenue Partners.  We specialize in international and overseas clients interested in New York investment property.
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Friday, January 15, 2010

New York Property

Castle Avenue Partners focuses on residential and commercial investment property in Manhattan, New York.  Our value lies in analyzing and recommending the right New York property for our client, managing, and handling the eventual sale. Our recommendation will include appreciation and rental potential, neighborhood growth, yield relative to stocks and bonds and tax implications.  The goal is to serve as an acquisition partner to local, overseas and international clients and collectively grow wealth through New York property.

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Focusing on buyers, the entire Manhattan, New York market is our inventory. 

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New York property

New York Commercial Property Yield

Commercial property yield in New York (Manhattan) is driven by price point.  The lower price point properties, less than $20 million, generally have an asking price at a 5 percent yield.   

The higher price point commercial properties, more than $30 million, would have a higher yield , perhaps 8 percent or more.  Reason is that at a higher price point, there are fewer players  which decreases demand.  Also, buyers at the higher price point are often institutions that put a lot more pressure on sellers from a pricing perspective.

The value of commercial property is driven by yield.  Similar to a stock's PE ratio.  The more the landlord can obtain in rent, the higher the value because a set multiple, in this case rental yield, would be applied.

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Visit our website http://www.castle-avenue.com/ to learn more about buying New York commercial or residential investment property. We focus on local, overseas and international investment property clients.

Wei Min Tan is a real estate broker and investor focused on investment property in Manhattan, New York. He can be reached at tan@castle-avenue.com

New York Property Yield

New York property (Manhattan condo) as an investment would have a gross rental yield of 4 to 5 percent. After paying for common charges and taxes, the net rental yield reduces to about 3 to 4 percent.

Manhattan, New York property is not a yield but rather an appreciation game. An investor buying New York property focuses on the long term appreciation potential. Demand for Manhattan property is global, coming from all over the world. Manhattan is a brand and the vacancy rate is less than 2 percent, relative to the US's 10 percent average. Inflation would mean rents and property values will increase.

A yield strategy in the US would mean investing in a midsize of small city. For example, Syracuse, New York is a college town with a yield of 10 to 15 percent. From personal experience, the appreciation from a city like Manhattan New York far outweights the rental yield cashflow from a midsize of small city.

Our website Castle Avenue Partners - Manhattan investment properties
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New York Property Yield

Thursday, January 14, 2010

Chinese Property Agent in New York City

I am a Cantonese Chinese speaking real estate agent in Manhattan, New York serving foreign and international investment property buyers. Our clients include investors from Hong Kong, Singapore, China and Malaysia.

I grew up in Klang, Malaysia, and came to the US for college and MBA education.  Consequently, I worked as a banker at Citigroup for 9 years and attained numerous achievements.  Four years ago, I left corporate world to focus on being a full time real estate investor and broker.

Our clients usually purchase investment condos in new developments in Manhattan because Manhattan has shown to be an asset that sustains its value, despite the current recession. For example, Manhattan prices decreased by about 20 percent during the current recession. This decline is much lower than the declines at similar major cities such as Los Angeles and San Francisco where prices declined by 40 to 50 percent. Manhattan prices are also more stable relative to stocks where in 2008, prices declined by 40 percent.

Reasons for our clients' purchases include:
(i) taking advantage of the current downturn
(ii) purchasing residence for children attending college or university in Manhattan, such as at New York University or Columbia University.

We also represent clients purchasing commercial investment property in Manhattan, including mixed use buildings and commercial condos. Besides Cantonese Chinese, I also speak Malay, the national language of Malaysia.

Visit Our Overseas Buyer's Guide
New York historical price appreciation
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Property yield
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New York investment property search

Visit our website at http://www.castle-avenue.com/

Best,
Wei Min
tan@castle-avenue.com
212.682.8494

Buying New York Property

New York property, specifically Manhattan, is popular amongst high net worth individuals internationally because of it's brand value and ability to sustain value even during economic downturns. 

Manhattan has performed better than the broader U.S. real estate market and comparable major cities such as San Francisco and Los Angeles.  Relative to peak, Manhattan property decreased by about 20 percent during this economic downturn.  This is compared to the 40%+ decreases in cities like San Francisco and Los Angeles. 

Below are common questions asked by our overseas / international clients about buying New York property

Can foreigners / overseas buyers purchase property in New York?
Yes. Many foreigners buy property in Manhattan because of the brand value and appreciation potential. They often purchase as a pied-a-terre (vacation home), or investment property. A large percentage of our clients are international, from countries like Malaysia, Singapore, Hong Kong and China.

What type pf properties are popular amongst foreign or international buyers?
There are two categories of apartments, condos and co-ops. We recommend condos because of the higher appreciation and investment value. Co-op buildings often restrict ability to rent and perform renovations and do not make good investment property. The process of buying a co-op is subject to board approvals which dramatically prolong the buying process. The value of a condo, on a per-square-foot basis, is about 20 to 30 percent higher than a co-op. However, the appreciation potential and demand are higher as well.

Besides apartments, our international clientele also purchase townhouses, mixed use buildings and commercial buildings.

What are the expenses associated with owning a property in Manhattan?
For apartments, the main monthly expenses are taxes, common charges, insurance and depending on whether financing was used, mortgage principal and interest.
New development buildings often have a tax abatement which dramatically reduces the monthly tax amount. Without abatement, annual taxes are often between 0.5 to 1 percent of the property’s value. Common charges average $1 per square foot per month and it goes up or down depending on number of units and amenities. Insurance is roughly $500 to $1000 per year and on a monthly basis, a relatively smaller expense item.

Is financing available for foreign or international buyers?
Yes, mortgage loan financing is available and can be obtained either through a mortgage broker or directly from the bank. Since the credit crisis, lenders have tightened credit criteria and will require about 40 percent as downpayment from a foreign buyer. Most mortgage products for foreigners are ARMs (adjustable rate mortgage) but some lenders offer 30 year fixed mortgage to foreigners. We will refer our foreign clients to reputable mortgage brokers or banks to help arrange financing for your New York property.

What are closing costs?
Closing costs are roughly 3 to 5 percent of the loan amount. This includes mortgage tax, transfer taxes if purchasing a new development, attorney fees, recording taxes and other administrative expenses.

Who pays the broker fee?
With New York Property, broker fees are paid by the seller. When the seller’s broker agrees to list the property for sale, a certain percentage is agreed upon as commission. If the buyer is represented by a broker, this commission will be split with the buyer’s broker. If the buyer does not have a broker, then the seller’s broker keeps the entire commission. Hence, it is in the best interest of the buyer to have broker representation to help identify the right property and negotiate the best price.

Visit our Overseas Buyer's Guide
New York Property FAQ
New York Price Appreciation History
New York Investment Property Overview
Buying New York Property - Our Services

 
Wei Min Tan is a real estate broker and investor focused on investment property in Manhattan, New York. He can be reached at tan@castle-avenue.com

Buying New York property from overseas, condo and renter management

After our overseas investor client buys an investment condo in New York, the next step is to market to potential tenant renters.  Here are the steps we perform:

1.  Market to potential renters using various marketing channels
2.  Screen potential renters / tenants (credit score, references, salary, work history)
3.  Arrange for tenant move in
4.  Set up automatic transactions for tenant to automatically deposit monthly rent checks into owner's account. 

The system above removes the need for owner to pay monthly property management fees.  Property management fees are anywhere from 3% to 10% of gross rent.  Since Manhattan tenants are usually high income and good credit quality individuals, there is usually very little management necessary.

As the need arises where the tenant requires attention, we will be the point of contact to help resolve the issue at hand.

Visit our Overseas Buyer's Guide
Historical price appreciation
New York property articles
New York property search
New York investment property overview
FAQ

Wei Min Tan is a real estate broker and investor focused on investment property in Manhattan, New York. He can be reached at tan@castle-avenue.com