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Should I Buy a Condo or Co-op in NYC?

4/5/2022

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By Colin O'Leary
April 5th, 2022


If you are in the market to buy a home in NYC, there are a few things you should know before you start the home buying process. Unlike most parts of the country, New York City is dominated by the condo and co-op market. For this reason, it's important to understand the difference between the two. There are pros and cons for each. Both offer different forms of ownership. One may work better for you than the other depending on your lifestyle and goals. 

First, if you are planning to buy in NYC as an investment property, then condos are typically the best way to go. Condos are best suited for investors. Co-ops on the other hand are better suited for end-users. This is because co-op buildings are much more restrictive with rules and regulations. For example, let's say you want to live in the unit you just purchased for a few years, and then rent it out down the road, then a condo might be a better option for you. If you purchase a co-op and then have to move for whatever reason, you might be forced to sell eventually because of the restrictive subletting policies. 

Co-ops typically have a higher owner-occupancy rate compared to condos. Some people prefer to purchase in co-op buildings because the buildings are less transient, and you are more likely to know your neighbors. Most co-op buildings allow for some form of subletting, but typically only after a few years of living in the space, and then only temporarily. Some co-op buildings don't allow for subletting at all. Most co-ops don't allow any form of short-term subletting or AirBnB. If you purchase a condo, on the other hand, you can rent it out to anyone you like, for however long you prefer. You can rent it out for a week, month, or year. This is why condos are more suited for investors. Co-op buildings are also typically less pet friendly compared to condos, often coming with restrictions on cats and dogs. 

Another difference between the two is that condos are typically more expensive. For example, a buyer might pay $900,000 for a one-bedroom condo in NYC, while a similar size unit in a co-op building could go for $700,000. One of the main reasons for this is because of the smaller pool of potential buyers in the co-op market. The condo market on the other hand is full of both investors and end-users. Co-ops typically require a larger down-payment of 20% or more. Condos can be purchased with a 10% down payment or less in some situations.

Another thing to know is that condos are typically quicker and easier resell. Co-op sales typically take longer because of the lengthy co-op board application. It also costs more to resell a co-op. For example, in addition to the typical broker, attorney, and transfer tax fees, most co-op buildings also charge sellers something known as a "flip tax," which is a percentage of the sale price, usual anywhere from 1-3% or more. Condos don't typically charge a flip tax when selling. 

Another difference between the two is the ownership structure. Buying a co-op is sort of like buying stock in a corporation. The owners of co-op units are more like tenants or shareholders than owners of real property. Co-op owners are assigned a certain number of shares when purchasing in the building. The number of shares assigned depends on the particular unit purchased in the building. For example, a larger unit on a higher floor would have more shares assigned than a smaller unit on a lower floor. Co-ops typically require buyers to purchase as a primary residence or pied-a-terre, while condos have no such restriction. 

Another major difference between a condo and a co-op in NYC is the application process. Co-op buildings have a much more extensive application process compared to condos. If you purchase in a co-op in NYC you will have to go through a tedious board approval process that requires an in-person interview with the co-op board (sometimes on Zoom now). This application process includes revealing extensive financial and personal information. Co-op boards hold tremendous power over unit owners and potential buyers. Condos have a somewhat similar purchase application, but it's much less extensive. When you purchase a condo, you are buying the actual space, and not shares in the building.

Another thing you should know about condos and co-ops in NYC is that you will be required to pay a monthly fee to help maintain the building. This is another cost in addition to the monthly mortgage cost. This monthly fee is used for things like ongoing building maintenance, employee salaries, gas, water, electricity, and insurance. Condo buildings typically refer to this monthly fee as the "common charge," while co-op buildings refer to this as the "maintenance fee." The monthly maintenance fee in a co-op building is determined by the number of shares assigned to each unit. Common charges in a condo building are calculated by taking each unit's percentage of common interests and multiplying it by the total operating costs of the building. One of the big differences between condos and co-ops is that property taxes 
are included in the monthly fee at co-op buildings, while condo owners pay property taxes directly to the government. 

To conclude, its important to do your research before you start your home search. There are pros and cons to each property type. One may work better than the other for you depending on your particular situation. If you have any questions about buying or selling a co-op or condo in NYC, please email us at thebigcityteam@bhhsnyp.com or call 646-300-2012.
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What The Queens Real Estate Market Looks Like Right Now

3/31/2022

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Queens, NY: Photo by Harry Gillen
By Colin O'Leary
March 31st, 2022


The housing market in Queens is continuing its hot streak into 2022. Queens County, the second largest borough in NYC by population size, has a population of over 2,405,000 according to the 2020 census. That's up from around 2,200,000 people in 2010. Only Brooklyn (Kings County) has more people than Queens. To put things in perspective, if Queens were its own city, it would rank on the list of the top five largest cities in America.

Queens is one of the most culturally diverse places in the United States, with a foreign-born population of nearly 50%. With easy access to critical infrastructures such as highways, bridges, airports (JFK & LaGuardia), hospitals, schools, parks, beaches, and public transportation, it's no surprise people are choosing to live in Queens. The close proximity to Manhattan makes it a great place to live for the bridge & tunnel crowd. The property tax burden is also less for homeowners in Queens compared to nearby Nassau County making it a more affordable option. 

The pandemic barely made a dent in the hot housing market in Queens. Many people escaped more densely populated areas of the city to find space in more suburban parts of Queens. Like most parts of the city, home prices in Queens have risen drastically over the past decade. For example, the typical value of a home in Queens was around $460,000 in April of 2012, according to Zillow Home Value Price Index. Today the typical value of a home in Queens is closer to $750,000. That's a sizable 38% increase over the past decade. 

Queens is a large county that encompasses over 178 square miles. Homes tend to sell for more in the western part of the county which is closer to Manhattan. The architecture in Queens is just as diverse as the people. Queens has densely populated urban neighborhoods with large residential towers like Long Island City. It also has more suburban neighborhoods like Bayside and beachfront communities like the Rockaways. 

Some of the hottest neighborhoods in Queens right now are Long Island City, Astoria, Jackson Heights, Elmhurst, Ridgewood, Forest Hills, and Flushing. The market shows no signs of slowing down in Queens, where supply continues to be outpaced by fierce demand for homes, often leading to bidding wars on properties. Will rising interest rates, inflation, and the war in Ukraine eventually put a damper on the demand for homes in Queens? Only time will tell. 

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7 Fun Things To Do Outdoors In NYC This Spring

3/29/2022

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By Colin O'Leary
March 29th, 2022


It was a long and cold winter but the springtime is finally here. Thankfully warmer days are ahead of us. There's no place like NYC in the springtime. It's is a time for renewal. A time for growth. It's when this city starts to come alive again. It's a time to explore the big city and all that it has to offer. There are a lot of fun places to explore in NYC in the springtime. We've put together a list for you of a few fun things to do during the springtime in NYC. Enjoy! 


​1. Visit Central Park

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Central Park: Photo by Harry Gillen

​Lets start the list with the most obvious choice. Central Park is a massive 843-acre oasis in the heart of Manhattan. It's full of nature trails, trees, rocks, lawns, animals, and birds. It's a natures lovers paradise. Head to Central Park this spring to escape the hustle and bustle of everyday city life. The landscaped architecture and views will leave you feeling inspired. Springtime is when the park really comes to life. ​It's a great place to relax, soak up some sun, exercise, play sports, or just meetup with your friends. No list would be complete without Central Park. Do yourself a favor this springtime and head to Central Park!

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2. Walk the Brooklyn Bridge

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The Brooklyn Bridge: Photo by Matthew Schwartz

​Have you ever walked across the entire Brooklyn Bridge? If not then this is a must do this springtime. The Brooklyn Bridge is one of NYC's most iconic and recognizable structures. It was built in the late 1800's to connect the boroughs of Manhattan and Brooklyn. Prior to its construction the only way to get across was by ferry. Designed by John Roebling, the bridge is 1.1 miles of pure NYC architectural history. Walking the Brooklyn Bridge is a great way to spend a morning, afternoon, or evening. It's a great way to get some epic pictures for your Instagram account too, while also getting some exercise and fresh air. You can walk from the Manhattan side to Brooklyn, or you could walk from Brooklyn side to Manhattan. It's totally up to you. If you haven't walked across the Brooklyn Bridge, then make sure to add this to your springtime to-do list. You won't be disappointed! 

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3. Escape to Prospect Park in Brooklyn 
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Prospect Park:

​If your looking for a park that's similar to Central Park but without the massive crowds, then head on over to Prospect Park in Brooklyn. If you haven't been there, Prospect Park is basically the Central Park of Brooklyn. It's a 526-oasis of trees, grass, nature trails, hills, lakes, streams, waterfalls, and historic landscape architecture. The park was designed by the same man who designed Central Park in Manhattan, Frederick Law Olmstead. You will find a lot of similarities bewtween the two parks. Both have great lawns for relaxing, sports fields, bandshells, nature trails, lakes, and zoo's. Both have beautiful landscaped architecture. It will take you multiple visits to explore this massive park in Brooklyn. There is so much to see in Prospect Park. Make sure to add it to your springtime to-do list! 



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4. Be a Foodie at Smorgasborg

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Smorgasburg in Brooklyn

​If walking around parks or bridges is not exactly your thing, but food is, then Smorgsburg might be more for you. Smorgasburg is a massive food bazaar hosted in different locations in NYC each year. It's a culinary extravaganza spotlighting local food vendors from across the city. Smorgsburg is planning to setup its food bazaar in four spots this year, including the two usual sites in Brooklyn, in Williamsburg and Prospect Park. They are also planning to host events at the World Trade Center in Lower Manhattan, and also on the other side of the Hudson in Jersey City. If food is your thing, then make sure to add this to your to-do list this spring! 



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5. Head to the Cherry Blossom Festival 

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Photo by Tatiana Rodriguez

Springtime in NYC is a season of rebirth. There's no better place to experience the springtime in NYC than at the 52-acres Brooklyn Botanic Garden. It's a great place to visit any time of the year. The Brooklyn Botanic Garden is located next to Prospect Park. The park is open year round. It's filled with exotic species of plants and trees from around the world. The Brooklyn Botanic Garden hosts an annual Cherry Blossom Festival each year at the end of April. If you have never been to the annual event then this is a must do. The Instagram-worthy festival will leave you in awe!



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6. Head to a Baseball Game 

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Yankee Stadium in the Bronx: Photo by @jgregoryd

​One of the most New York things you can do this spring is head to a baseball game at Citi Field or Yankee Stadium. If you have never been to a baseball game in NYC then this is definitely a must do. Going to baseball games is a rite of passage for New Yorkers. Even if you don't like baseball, you will still enjoy going to a game at Citi Field or Yankee Stadium with your friends. You can hop on the 7-train and head to Citi Field in Queens, or you could take the 4-train to Yankee Stadium in the Bronx. It only takes about 20-30 minutes from Manhattan. It's a great way to spend a beautiful spring day! 



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7. Explore Flushing Meadows-Corona Park 

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Flushing Meadows Corana-Park: Photo by Emma Angel

Just south of Citi Field in Queens, at the same subway station on the 7-line, is the entrance to Flushing Meadows-Corona Park. The massive 897-acre park is best known for hosting the 1964 World's Fair. It's the biggest and best park in Queens. The park is home to the Billie Jean King National Tennis Center, which hosts the annual US Open tennis tournament each summer. It's also home to the iconic Unisphere as well (see above). The park has so much more to offer though. There's also a museum, theatre, botanic garden, indoor ice rink, walking trails, and a zoo. If you have never been to Flushing Meadows-Corona Park, make sure to add this to your to-do list this spring! 


We hope you enjoyed the list! Let us know what your favorite thing to do in the springtime in NYC in the comment section below. Now get outside and explore the city! 



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Stunning Color Film of the Empire State Building under construction

3/18/2022

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Rare Color Film of NYC in the 1960's

3/4/2022

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U.S. Home Prices Surge with Record Year in 2021

2/22/2022

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Photo by Avi Waxman

​By Colin O'Leary
February 22nd, 2022


The average price of a home in the U.S. soared by 18.8% in 2021, according to a report from the S&P CoreLogic Case-Shiller National Home Price Index. The S&P CoreLogic Case-Shiller National Home Price Index tracks average home prices in major metropolitan areas across the country. The yearly increase in home prices was the highest since the index began tracking home prices in 1987. Data over at Zillow shows similar numbers. The Zillow Home Value Index tracks home values in the United States. Zillow says the typical value of a home in the United States is currently around $325,000, an increase of 19.9% year over year. Zillow is bullish on the real estate market for 2022. They are predicting home values to climb towards $380,000 by the end of the year. 

Last year was one of the busiest in recent history for home sales in the U.S. The total number of homes sold in the United States climbed to a 15-year high in 2021, according to the National Association of Realtors. Existing home sales totaled 6.12 million – an increase of 8.5% from 2020 and the highest annual level since 2006. This figure does not include new construction. Low inventory and fierce demand from first time home buyers and investors led to a record year for the housing market. Sparked by the global covid-19 pandemic, buyers took advantage of record low interests rates in search of larger spaces where they could work from home in one of the busiest years since the U.S. recession in 2008. 

First time homebuyers continue to struggle to compete against cash buyers and investors in a market faced with rising interest rates and record low inventory. The shortage of homes has sparked many bidding wars, pushing prices even higher than usual. The Phoenix Metropolitan area had the fastest home-price growth in the country, at 32.5%. The Tampa Bay Metropolitan area posted the second-fastest growth, at 29.4%.


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Manhattan Real Estate Market Update I February 2022

2/18/2022

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By Colin R. O'Leary
February 18th, 2022


It's been nearly two years since the start of the coronavirus pandemic, which resulted in an exodus of New Yorkers fleeing to the suburbs. The strict lockdowns wreaked havoc on the city's economy. It brought the Manhattan residential market to a near standstill, while simultaneously sparking demand for homes in nearby suburban markets like New Jersey, Westchester, Connecticut, and Long Island. Now two years later, the tide is beginning to shift. People are returning to the city, and the Manhattan real estate market is starting to roar back to life. 

Last year was a record-breaking year for the Manhattan residential market, fueled by pent-up demand caused by the pandemic lockdowns of 2020. There are still a lot of great deals to be found for buyers who are active in the market. However, the residential market in Manhattan is starting to shift in favor of sellers. For example, the number of homes on the market in Manhattan has decreased significantly year over year. According to real estate data company Urban Digs, the number of active listings on the market in Manhattan has declined by -28% compared to February 2021. There are currently about 5,170 homes available on the market in Manhattan. This number includes all active condo, co-op, and townhouse listings. There continues to be an uptick in signed contracts as well. The number of pending sales in Manhattan increased by nearly 17% compared to February 2021. The total number of pending home sales in Manhattan is currently hovering around 4,050, according to Urban Digs.

The condo market in Manhattan is favoring sellers right now. The condo market has been fueled by the luxury market, or homes selling for above $4 million. For example, the median sale price in January was $1,783,750, a sizable increase of 21% year over year. The supply of condos available for purchase has decreased significantly year over year. The number of condos available on the market as of February 2022 is currently hovering around 2,450, a significant decrease of -29% year over year.

It's a similar story with the co-op market in Manhattan right now. The median sale price for a co-op was $822,500 in January, according to Urban Digs. That's an increase of 8% compared to the same time last year. The supply of co-ops available for purchase in Manhattan also declined by -27% year over year. There are currently about 2,500 co-ops on the market right now in Manhattan. 

Interests rates are on the rise, up by almost a percent since the fall. Mortgage rates for a 30-year fixed-rate loan are currently hovering around 4%. The Fed is expected to raise rates further this year in an attempt to offset rising inflation. What kind of impact will this have on the Manhattan market? Only time will tell how much of an impact it will have in a city where many buyers pay in all-cash. 


The Manhattan rental market has been on a tear as well. Manhattan rents surged by 23% in January compared to the same month last year according to The NY Post. The median price for a rental in Manhattan was $3,467 last month, just short of the record set in April 2020, when the median rental price was $3,540. There's been a significant decrease in rental inventory. In January 2021, there were 25,883 apartments in Manhattan available for rent. Last month, that number plummeted to just 4,316 available rentals — a whopping 83.3% drop in inventory levels.

The numbers are looking strong for the Manhattan residential market. The market is returning to its cyclical nature. Inventory levels are down and pending home sales are up. February is typically one of the slower months of the year activity-wise because of the colder weather. The market should continue to favor sellers in Manhattan heading into the warmer months of the year. The springtime is typically the most active time of the year for the real estate market in NYC, with an increase in buyer activity coupled with an uptick in new listing inventory hitting the market. The combination of these factors should lead to a continued increase in pending home sales in Manhattan this spring.
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Thanks for reading. Let us know where you think the Manhattan market is heading in the comment section below! 

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The Berkshire Hathaway HomeServices 2022 Real Estate Report

1/13/2022

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​We’re pleased to present the Berkshire Hathaway HomeServices 2022 Real Estate Report. In this report, we look at buyers’ changing priorities and tastes, inventory and material supply issues, and we explore which parts of the world are showing lots of growth – from Dallas to Dubai and almost everywhere in between. ✈️🌎

See the report here
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Mortgage Rates Spike to Highest Level in 2 Years

1/11/2022

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Photo by Matt Donders

By Colin R. O'Leary
January 11th, 2022


The cost of borrowing money for a home is on the rise in 2022. Last week was not a great one for the mortgage industry. Seemingly overnight, the narrative has changed as mortgage rates are spiking to levels not seen in two years. By the end of the week ending on January 7th, most lenders were roughly a quarter of a point higher on a conventional 30-year fixed mortgage. Several factors including the omicron variant, inflation, fed tapering, and weakness in the bond market are putting pressure on rising interest rates. 

Rates have been slowly ticking upwards since August of 2021 when they were still near all-time lows. For example, rates were as low as 2.83% for a 30-year Fixed-Rate mortgage back on August 2nd, according to the site Mortgage News Daily. Mortgage rates were still at historically low levels by the end of the year, however, gradually rising above 3%. Now less than two weeks into the New Year and we're seeing rates rise to the highest levels in 2 years. The interest rate for a 30-year fixed-rate mortgage is currently hovering around 3.64%, as of January 11th, 2022. Many experts in the real estate industry are predicting that rates will rise above 4% in 2022. If rates continue to rise at this level, it won't be long before that happens. 

How will rising mortgage rates affect real estate prices? It could be bad for sellers in some markets. Higher mortgage rates mean fewer buyers in the market. Fewer buyers in the market mean fewer offers being made. This could put a damper on fast-rising real estate prices around the country, especially in markets with higher inventory levels. Markets with lower levels of inventory should continue to favor sellers in 2022 even with rising mortgage rates. 

Rising mortgage rates are not necessarily bad for all home buyers and investors though. If home prices decrease in 2022, it could potentially offset rising mortgage costs compared to paying for a home at current home values. How do you think rising mortgage rates affect the real estate prices in 2022? Let us know your thoughts in the comments below. 


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Another Satisfied Customer for The Big City Team!

1/6/2022

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Berkshire Hathaway HomeServices
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Team Leader: Colin O'Leary
​Email: thebigcityteam@bhhsnyp.com
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​​​Berkshire Hathaway Home Services New York Properties: © 2022 An independently operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate, and a franchisee of BHH Affiliates, LLC. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc.® Equal Housing Opportunity. Information not verified or guaranteed. If your home is currently listed with a Broker, this is not intended as a solicitation. Copyright © 2022 The Big City Team at Berkshire Hathway HomeServices New York Properties, All rights reserved
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