Monday, September 21, 2009

Former SI Navy Homeport Seals The Deal!


Ironstate Development of Hoboken plans to invest $150 million to build apartment buildings, stores and a public plaza as part of the long anticipated redevelopment of the Homeport on Staten Island’s waterfront.

Ironstate, formerly known as Applied Development, is teaming up with the city of New York to make over a portion of a former Navy homeport in Stapleton on the northeastern side of Staten Island. Plans call for building two residential buildings up to six stories tall with about 800 apartments on a seven-acre site, according to the city’s Economic Development Corporation. Rents for one-bedrooms would run between $1,200 and $1,500 while two-bedrooms would rent for $1,500 up to $2,000.

The complex would include 30,000 square feet of shops and restaurants on the ground floor with wide sidewalks and a public plaza for outdoor dining. The city has committed $33 million for infrastructure improvements including road reconstruction that would improve access to the site from the Stapleton neighborhood and a new waterfront esplanade next to the apartments, which would give the public access to the waterfront. The project would generate more than 1,100 construction jobs and 150 permanent jobs including retail and building maintenance positions. Construction is expected to start in early 2011.

Ironstate is recognized for developing mixed-use urban waterfront projects including the sumptuous W Hoboken hotel, which opened earlier this year on the Hudson. The Staten Island project is a natural fit, said Greg Russo, a principal at Ironstate. The project is appealing because of its location in the middle of the city, transportation links and spectacular views of Lower Manhattan and the Verrazano-Narrows Bridge, he said.

And while the recession has brought new development to a virtual standstill in the city, Russo and his colleagues say they believe economic recovery is on the horizon.

“Of course the economy is slowing things down,” Russo said. “Financing is challenging, but we’re moving forward with selected projects that have potential. We think we’ve hit the bottom. It’s hard to predict how quickly the recovery will happen but we don’t see it getting worse from here.”

- By Lynne Miller of The Real Deal

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Thursday, September 17, 2009

Is your home too much home?

downsize.jpg image by revirtualassistant

An interesting NY Times article about people downsizing. While many people bought oversized homes and expanded them in the boom times thinking that theis would be the family compound where they would retire in their golden years, many people are now reconsidering and realizing that a big oversized home may not be what really matched their needs as they age.

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Wednesday, September 16, 2009

Seven New Rules for the First-Time Home Buyer

From the NY Times article:

A list of seven suggestions they offered up in its place.

START WITH THE BASICS Let’s begin with some other standards, tried and true advice that served banks and borrowers well for years, until they forgot all about them in the race to write more loans and buy bigger houses. Put 20 percent down, so you have less of a chance of owing more than your home is worth if prices fall again. Get a fixed-rate mortgage, so the biggest part of your monthly housing bill remains stable.

If you’re determined to be truly conservative, don’t spend more than about 35 percent of your pretax income on mortgage, property tax and home insurance payments. Bank of America, which adheres to the guidelines that Fannie Mae and Freddie Mac set, will let your total debt (including student and other loans) hit 45 percent of your pretax income, but no more.

That said, if you end up with an adjustable-rate loan, banks may not be concerned with whether you’ll be able to afford the maximum possible payment when the interest rate adjusts in five or seven years. But you should be worried about it.

CONSIDER YOUR INCOME The best case for stretching for a first house is that first-time home buyers in their 20s and 30s will probably see their incomes grow more quickly than older people buying their second or third home.

Harvey S. Rosen, a Princeton economics professor, finds in a forthcoming Journal of Finance article that he co-wrote with two Federal Reserve Bank economists, Kristopher Gerardi and Paul S. Willen, that the size of a house that someone buys tends to be a good indicator of what their income will be later. “People can, on average, make reasonably good predictions of their future incomes and act on them in sensible ways by buying bigger houses,” Mr. Rosen said.

Indeed, much of the mess in the mortgage market has been because of people borrowing money with loans that they didn’t understand — or betting that housing prices would continue to rise enough that they would be able to refinance their loans before the payments rose. Income overconfidence may have had something to do with it (and high unemployment worsened the problems), but it’s probably not the primary cause.

BOW TO UNKNOWNS This research is all well and good as long as you continue to work. But if you’re buying your first home before you have children, you may feel quite differently about work once you become a parent. And if you do, you may not want a mortgage boxing you in to going back to the office three months after the baby is born.

Bobbie D. Munroe, a financial planner with Fraser Financial in Atlanta, encourages younger clients in this situation to model out their budget, including any proposed mortgage, three ways — with both spouses working full time, one working part time and one staying at home for a few years. She also suggests imagining or even practicing living on one income, to see if it’s truly realistic.

“What people should do is ultimately their own decision,” she said. “But they should do it with eyes wide open.”

Even people who don’t want to have children need to consider this. Besides the obvious possibility of sustained unemployment, what about the need to escape a dying industry or an early midlife crisis that necessitates career change to stave off depression? Even government employees and medical residents who believe that their incomes are set for life ought to consider this possibility.

MAP OUT EXPENSES It stands to reason that anyone tempted to stretch for a house will be inclined to play down the expense of maintaining it. These costs are anything but ancillary, though.

For many years, Dennis G. Stearns, a financial planner in Greensboro, N.C., has been alarmed enough by clients’ unrealistic expectations that he’s maintained a home cost spreadsheet that he shares with clients shopping for houses. He also updates it periodically with aggregate, real-world data based on their subsequent experiences.

Mr. Stearns estimates that owners of a newer home that do some work for themselves but contract major work out to others will pay 3.6 percent of the original purchase price annually for maintenance and 4.5 percent if it’s an older home. So if you own a $400,000 home, your costs will probably hit the five figures each year — and may rise with inflation. These expenses will be another 20 percent or so higher if you live in a severe weather area. He does note, however, that the tax benefits of home ownership can offset half or more of these costs in some areas of the country.

BUY BEST (OR CHEAPEST) All of these caveats have given rise to some unusual strategies. Michael Kalscheur, a financial planner with Castle Wealth Advisors in Indianapolis, suggests buying the dream house you covet (if you can afford it) or an inexpensive starter house but not anything in the middle.

“If people have their heart set on something, inevitably, if they can’t afford what they really want, they buy the next best thing,” he said. “That’s absolutely the worst thing you can do. Not only do you not get what you want, but it sucks you dry.”

Why? Well, if you buy that entry-level home instead of the silver-medal home, you can save a lot more money each month after making the house payment (as long as you’re disciplined) than you would if you were paying a big mortgage toward that next best house. And all of your other housing costs will be lower, too. Then, several years later, you’re in a much better position to buy what you actually want.

STRETCH THE HOUSE Better yet, keep in mind that you don’t ever have to move from that first home — and incur all of the transaction costs associated with selling and buying and moving again.

J. Michael Collins, an assistant professor in the department of consumer science at University of Wisconsin’s School of Human Ecology in Madison, suggests paying less for a home that you can upgrade periodically when your income is stable and your savings or available credit make it possible.

In other words, stretching out your tenure in a home (and the physical boundaries of the home itself) may make more sense than stretching for each successive mortgage in a series of two or more houses.

THE EIGHT-HOUR RULE One rule about all of these rules is that it’s unlikely that every one will apply to every circumstance. Individuals and their income streams are too varied, and real estate markets are themselves unique.

When all else fails, however, you can always fall back on the eight-hour test. Whatever the size of your mortgage, you have to be able to sleep soundly at night. So if an impending loan has you stretching for the Ambien, it’s a pretty good sign that the loan is a bit of a stretch as well.

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Friday, September 11, 2009

And Anthony Bourdain Agrees...

TV epicure Anthony Bourdain makes a trip to the outer boroughs on 'No Reservations.'

On Labor Day, The Travel Channel broadcasted Anthony Bourdain's No Reservations featuring exotic foods (our theme du jour) found here on Staten Island (oh, and in the other boroughs too). You can read the Daily News article about it here, but here is one of his recommendations:

New Asha Sri Lankan Restaurant

322 Victory Blvd., Staten Island

Directions: Take the ferry to St. George Terminal, then take the S67 bus to Victory Blvd.

Food bio: New Asha is known for its black curry, which is made with a supersecret blend of toasted spices and cooked with either meat or veggies.

Must try: Black curry eggplant and any tropical drink from the tiki bar.



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Exotic and Vibrant on Staten Island

An excerpt of an interesting article from the New York Times about the influx of affordable, exotic foods in Staten Island, long the bastion of Italian restaurants and Irish pubs.



STATEN ISLAND had the highest percentage of Italian-Americans of any United States county in the 2000 census (37.7 percent). It’s home to scores of old-time red sauce joints, trendy trattorias and legendary pizza parlors, many justifiably beloved.

But amid the pasta and pies, there’s a growing variety of dining choices, not surprising given that it’s the city’s most rapidly diversifying borough, according to the city’s Human Rights Commission. Staten Island’s Mexican population grew more than fourfold between the 1990 and 2000 censuses and helped transform the once-rundown Port Richmond Avenue on the North Shore into a vibrant dining strip.

There is a slightly greater percentage of Asians on Staten Island than in the city as a whole and it has more than a third of New York’s Sri Lankan population, which has created a fascinating eating and food-shopping district in Tompkinsville.

The borough’s diners are starting to embrace the expanded options, said Pam Silvestri, food editor of The Staten Island Advance. “In the last two or three years, we see a lot of people crossing over to other parts of Staten Island they wouldn’t have gone to, and trying different types of food,” Ms. Silvestri said.

Read the rest here: http://www.nytimes.com/2009/09/09/dining/reviews/09under.html


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Positive Statistics in Foreclosure Market Suggest Hope for Home Owners

http://www.reohometours.org/images/house_for_sale_by_bank.jpg

From an article on Reuters:
NEW YORK, Sept. 8 -- ForeclosureListings.com statistics suggest some improvement in the housing market, but the good news for homeowners might
be just a temporary setback for real estate investors searching for a good deal.

Decreases in the number of foreclosure filings in each state and increases in prices in many of those same states seem to suggest good news, although the
news is still mixed in some parts of the country. In five of the top markets, filings have decreased: California (down by nearly 5%), Michigan (down by just
over 4%), Florida (down by 8.5%), Arizona (down by 9%), and Texas (down by more than 7%). However, Colorado has seen the largest drop in foreclosures
with a decrease of more than 13%. Unfortunately, the statistics are not so promising for all states. West Virginia, for example, saw an increase in
foreclosures of more than 17%.

Within these and other key states, the changes in foreclosure filings in major cities also seem to be showing improvement with only a few exceptions. In
Phoenix, the number of foreclosures dropped by over 8%, the rates in Memphis fell by nearly 12%, the filings in Miami toppled by just over 14%. Other
states also saw a decrease: Atlanta (2%) and Houston (3.7%). However, both Chicago and Detroit saw their rates of foreclosure increase by less than 1%
and by just over 5%, respectively.

Although fewer foreclosures can help reduce the supply of available homes on the market, the prices are also important. In four out of the five top real
estate markets, prices have increased. In both California and Florida, the price increase is less than 1% bringing the average costs to $347,878 and
$222,950, respectively. Michigan's home prices went up by 1.4% to $91,614 while the prices in Texas increased by 4.8% to $116,016. Prices actually
decreased in Georgia: falling 2.6% to $126,914. The lowest average price for homes, according to ForeclosureListings.com, is $60,940 in Ohio.


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Thursday, September 10, 2009

Housing Affordability Remains at Near-Record Levels

http://4.bp.blogspot.com/_VeSpMOYywCU/SEXkOwaBTdI/AAAAAAAAAIY/t-y1KaCMGh8/s320/housing.jpg

An excerpt from an article from the National Association of Homebuilders:

Bolstered by affordable interest rates and low prices, national housing affordability on the NAHB/Wells Fargo Housing Opportunity Index (HOI) continued in this year’s second quarter to hover near its highest level since the series began 18 years ago.

The HOI showed that 72.3% of all new and existing homes sold in the second quarter of 2009 were affordable to families earning the national median income of $64,000, down only slightly from the record-high 72.5% during the previous quarter and up from 55.0% during the second quarter of 2008.

“The increase in affordability — along with the $8,000 federal tax credit for home buyers — is stimulating demand, particularly among young, first-time buyers,” said NAHB Chairman Joe Robson. “But to keep the recent upturn in home sales going into next year, Congress will need to extend the tax credit for another year and make it available to all buyers in an effort to encourage activity in the trade-up market.”

Robson noted that the tax credit, which expires on Nov. 30, is currently limited to just buyers purchasing their first home.

Indianapolis, once again, was the most affordable major housing market in the country during the second quarter. Almost 95% of all homes sold were affordable to households earning the area’s median family income of $68,100. Indianapolis has now topped the affordability list for 16 consecutive quarters.

Rounding out the list of the five most affordable major metro housing markets were: Youngstown-Warren-Boardman, Ohio-Pa.; Detroit-Livonia-Dearborn, Mich.; Dayton, Ohio; and Grand Rapids-Wyoming, Mich.

Several smaller housing markets posted even higher affordability scores than Indianapolis, with Kokomo, Ind. outscoring them all. There, almost 98% of homes sold during the second quarter of 2009 were affordable to median-income earners.

Other small housing markets ahead of Indianapolis on the affordability scale included: Lansing-East Lansing, Mich.; Mansfield, Ohio; Elkhart-Goshen, Ind.; Lima, Ohio; and Bay City, Mich.


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Friday, September 4, 2009

Housing's Hidden Strength

From Business Week:

Homebuilders and Realtors are lobbying Congress to keep alive the tax credit for home purchases and to make it available to more buyers. They say the $8,000 credit—which is for people who have not owned a home for three years or more and expires after Nov. 30—has boosted demand for low-priced homes, many of them foreclosed and in need of repair. But, they maintain, it has done nothing for the "move-up" market, let alone the luxury segment. Many say the housing market will falter unless the credit is extended, doubled in value, and given to any buyer. "The giddiness we see out there [about a recovery] is without merit," says Richard A. Smith, chief executive officer of Parsipanny (N.J.)-based Realogy, the parent of Century 21, ERA, Coldwell Banker, and Sotheby's International Realty.

But some little-noticed data indicate there's more strength in housing than the industry recognizes. Prices have stabilized, and even appreciated, in the middle- and high-priced segments of the market in many cities, not just in the low-priced segment that is most directly helped by the home-buyer tax credit. That's according to the Standard & Poor's/Case-Shiller tiered price indexes for 17 metro areas, which were released on Aug. 25 but received relatively little publicity.


Seasonally adjusted prices rose in each segment of the market w-, medium-, and high-priced) from May to June in cities including Boston, Washington, and Chicago. High-end prices went up even in hard-hit Phoenix. Las Vegas, where foreclosures are running extremely high, is the only one of the 17 metro areas that saw a price drop in all three price categories in June.

"The tiers are really revealing," says economist Karl E. Case of Wellesley College, who developed the index with Yale University economist Robert J. Shiller. "[The rising prices] can't be just first-time buyers." While prices could fall after the expiration of the tax credit, says Case, "It's not a knockout blow if the expansion is broad-based."

Those arguing that housing needs government life support say most of the sales action is in foreclosed homes, which tend to be super-cheap and are being bought as starter homes or investment properties. But a National Association of Realtors member survey seems to contradict that theory. Even as home sales rose, the share of first-time buyers dropped from 53% in March to 30% in July.

As for the argument that luxury is dead, Toll Brothers (TOL), the nation's largest luxury homebuilder, announced last month that in its May-July quarter it posted its first year-over-year increase in signed home contracts since 2005. Toll Brothers even started cutting incentives in some markets, mostly in the Northeast and mid-Atlantic states.

True enough, the housing market remains weak. Increasing the tax credit to $15,000 for all homeowners through the end of next year would result in 675,000 additional home sales, according to an analysis by Mark M. Zandi, chief economist at Moody's Economy.com (MCO).

There is evidence that sales fall when credits expire: In California, homebuilding slowed in July after a $10,000 credit for newly built homes expired. And with the rush of summer buying over, the market remains vulnerable to rising unemployment as well as a new wave of foreclosures, which could flood the market and drive down home prices. The Mortgage Bankers Assn. said last month that 9.24% of residential mortgage loans were delinquent as of the end of June, the most since recordkeeping began in 1972.

On the other hand, the housing market might be able to absorb more foreclosed properties as long as banks dribble them out slowly, says Rick Sharga, vice-president of Irvine (Calif.)-based RealtyTrac. "We may be in an unusual period of time where the market is recovering in spite of the record number of foreclosures," he says. "It's hard to explain, but that's what the numbers suggest at the moment."

With prices down and mortgage rates low, housing affordability is the best in years for those who can qualify for a mortgage (admittedly no easy feat). Michelle Meyer, an economist with Barclays Capital (BCS) in New York, says that while the tax credit did contribute to the lift in sales and prices, "A lot of it has to do with greater affordability and a brighter economic outlook. Even if you say some of the gain is artificial, it's still true that we're seeing an increase in housing demand, and that shows fundamental strength."



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Wednesday, September 2, 2009

New York Gives First-Time Home Buyers an Added Tax Incentive

In addition to the $8,000 federal first-time home buyer tax credit, the state of New York is providing a tax credit for residents who are looking to buy their first home.

The New York State Mortgage Credit Certificate gives qualified borrowers a tax credit equal to 20% of the mortgage interest for the life of the loan, which can be combined with the $8,000 first-time home buyer tax credit for those who qualify for both.

According to the state’s estimate, a home buyer with a $200,000 loan at an interest rate of 5.5% will realize just over $2,100 in tax savings in their first year of ownership — a savings of $182 per month. The tax credit amount will decrease over time as the amount of interest paid decreases.

A calculator has been provided on the state’s Web site to help home buyers determine savings based on their specific situation.

Unlike the federal tax credit, the state program does not expire on Dec. 1. There are restrictions, however. It only applies to new, fixed-rate mortgages — including conventional loans (Fannie Mae/Freddie Mac), FHA-insured loans and VA-guaranteed loans — and the tax credit will come to an end if the home buyer refinances their mortgage. The state has also placed purchase price limits on the property, which vary by region.

Like the federal tax credit, to qualify for the Mortgage Credit Certificate the borrower must be a first-time home buyer, reside in the property as their principal residence and meet income limit restrictions — which are based on the region in which the home buyer resides.

To get the Mortgage Credit Certificate, borrowers need to contact one of the state’s participating lenders and apply for it at the same time that they are applying for a mortgage. Upon approval, the borrower can claim the tax credit on their federal return along with IRS Form 8396.



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COAHSI's Mapping Staten Island Art Exhibtion

From a post in The Forgotten Borough:

The Council on the Arts & Humanities for Staten Island (COAHSI) will turn Staten Island’s massive New York Container Terminal into a contemporary museum for a special arts weekend highlighting the work of ten borough artists. The exhibit, entitled “Mapping Staten Island,” explores these artists’ perceptions of their resident borough, through physical installations, video, light, and musical recordings. The exhibit space – created by the newly established firm Archicorp -- will be a work of art in itself, as actual shipping pallets will be used to build walls, tables and other structures to display the artwork. After the exhibit, the pallets will be recycled and used for their original purpose of transporting consumer goods. This unique exhibit is open to the public on Saturday, October 3, 2009 from 10 a.m. to 6 p.m., with a minimal entry fee of $5.

Read more about the exhibit and the artists on The Forgotten Borough's post.

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Tuesday, September 1, 2009

Real Estate Agents Who Think Ahead of the Curve

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