Monday Links

Re: Condos

“AS the residential real estate market in New York City continues to emerge from its deep freeze, sales at new condominium developments are starting to pick up.”

Yeah, I think they call it capitulation.

“They bought a two-bedroom two-bath for $740,000.”

Whoops!

“When sales began in the building in 2007, the asking price for that apartment — on the 33rd floor with views of Manhattan and four bridges — was $1.075 million.”

Nowhere near actual comps at the time. Another exception to how sellers USUALLY set their initial asks, within 10% of REAL comps. Straight up ginnie pig.

“Construction loans dictate the lowest price at which an apartment can be sold, and these prices were set years ago in a very different market. Instead of writing down the asset on their balance sheet, some banks would rather the buildings sat empty. This situation may not be sustainable, but for now, some lenders have dug their heels firmly into the ground.”

Single most important paragraph. Banks hiding losses. Shadow inventory. Dead condos “walking”.

“But even playing it safe and waiting until a building is completed to put down a deposit is not without its pitfalls.”

Uhhhh…can you please elaborate on the pitfalls? You give me a plethora of arguments against buying too early but nadda against waiting.

Nice infommercial, Times. BTW, FHA status kind of tarnishes developments like the SOM-designed Toren. Effective subprime time bombs. Future defaults, foreclosures and/or walk-aways just ticking away. The next couple of years are going to be very ugly.

***Bid half off peak comps***

Good advice in the Times article about condo buyers looking into new construction.