I was recently in Scottsdale, Arizona for the Cyberstar Convention, which is a group of top producing real estate agents who have a special interest in technology and the internet. While there, I was interviewed by Michael Krisa (known as “That Interview Guy”) on increasing your referrals from other brokers. Michael has a great real estate site for brokers to get new and relevant information to increase their business. The interview turned out to be a good plug for CRS (Certified Residential Specialists); I’m glad I was wearing that shirt. 

Our company, The Corcoran Group, has created a new free app for iPhone users. The Corcoran app will allow you to search Corcoran listings in Manhattan, Brooklyn, the East End of Long Island and South Florida all with full photos, property details and the agents contact information. Also, using the iPhone’s GPS, the Corcoran app will identify your location and will let you know how far away you are from a listing!

If you would like to download the new Corcoran iPhone app or learn about all its features click here!

I reviewed the Second Quarter Report of residential real estate sales in Manhattan. My firm, The Corcoran Group, has released this report comparing data based on deals that closed in 2Q 2009 (April 1 through June 30) with that of 2Q 2008.

Due to the impact of the credit crisis and our nations recession there is a decline in sales activity and sale prices over the prior year.  2009’s Second Quarter posted 50% fewer closings over 2008’s.  The large amount of available properties along with low demand in the first part of the year has forced sellers to lower prices by 12-15%.  Therefore, buyers can negotiate much more and can snap up some of the best deals to be had in Manhattan in many years.

Spring is usually the busiest season and despite a slower market, the report shows greater sales activity in the Second Quarter than the First.  In fact June 2009 was even busier for our agents than the same month a year prior.

New developments showed decreased sale prices and slower activity as well. 67% fewer new development properties closed this quarter than in 2Q 2008, having an average drop of 14% in price per square foot.

If you would like to see this report in its entirety please contact me.

A new agent came into our manager’s office upset about a deal that was falling apart.  It seems the owner had given the agent the square footage figure from a recent appraisal.  The purchaser had their interior decorator/architect measure the space and it came up 150 square feet short of the number quoted by the agent.  The purchasers, naturally, wanted a price reduction.

Square footage is a funny thing in Manhattan, especially when dealing with coops.  It is my experience that two apartments each quoted as 1,000 square feet will be dramatically different in size.  Well how can that be, I mean a number is a number?  New York courts have ruled that it is perfectly acceptable for residential space to be quoted in "Gross Square Footage", a standard practice borrowed from commercial real estate in the city.   Gross Square Footage can be defined for practical purposes as the entire square footage of the relevant space including the bricks outside the walls and the space’s portion of common element on that floor.  For example, if the floor has four apartments of equal size, then 1/4th of the common hallways, 1/4th of the elevator shafts, and 1/4th of the stair wells would be included in the gross square footage figure.  Thus the loss factor (that which is outside of the apartment itself) can very from building to building.  Hence, two apartments which are quoted as the same size may actually be quite different.  Loss factors vary from 5% to 30% with the majority averaging 20%.

Many brokerage firms do not quote square footage due to potential law suits, or they try to get around the problem by saying the square footage is approximate (which by court standards is within 3%).  When push comes to shove, the square footage quoted in the offering plan is held to be sacrosanct by the courts.  So always check that figure.  It is my suggestion that you use the square footage number as a general benchmark to compare different apartments, but ultimately realize the numbers may be off.

I would like to see our industry begin to quote both Gross and Net Square Footage figures.  I would personally find that helpful and it would make it easier comparing apples to apples.

The new agent, you might wish to know saved her deal.  The owners finally found the square footage figure in the original offering plan and it was just off 19 square feet from their original quote, well within the approximate range. 

For my first blog, I thought I comment on an article I read yesterday in the New York Times.  I found the article "Couple’s Suit Accuses Real Estate Firm of Bias Against Children" by Andy Newman to be interesting on many levels.  The story basically focuses on an expecting couple who are consistently turned down to rent apartments in the Park Slope section of Brooklyn.  Eventually a law suit is brought against the owners and the couple’s brokerage firm, Brown Harris Stevens, for discrimination against renting to families with children under the Fair Housing Act.

Discrimination is clearly wrong and let us look at this story from the owners (landlord) side.  Say you own a two family townhouse; you live in one unit and you rent out the other unit for income and living in a quiet environment (yes, which may be possible in the city) is a value you hold high.  You have rented to families in the past and found the noise from young children to be understandable and disturbing none the less.  You would prefer to rent to a couple that is quiet.  Well that is illegal under the Fair Housing Act.  In my opinion, that seems very unfair to the townhouse owner who resides in his/her own building.  In a Coop you can deny a potential purchaser from buying an apartment in your building because they throw loud parties or play the piano at odd hours, but you just have to accept the noise of children in your multi-family townhouse.  Yes, families deserve the right to find an acceptable place to live and prosper too.  I wonder if the solution is to exclude houses under four units or small houses where the owner is in residence in one of the units.  Since the housing stock in Park Slope contains a large portion of owner occupied townhouses, it is not a surprise the family in question had these problems.

As the story was reported, the owners and brokers seemingly have to lie to protect themselves when they do not want to rent to families with children.  It is clearly an unenviable position for all.  It is so easy to blame the broker for he/she is breaking the law technically.  But what do you do after a prospective owner calls you (a real estate broker) indicates he wants quiet tenants, you tell him he can not discriminate against children and he says fine, just make sure they are quiet (meaning no young children or babies)?  If the owner lives in the building, my personal moral compass is to side with the owner on this issue.  Fortunately I have never been confronted with this dilemma in Manhattan, nor do I do that many rentals, but it is interesting and I wonder how I would handle it.  I also wonder if my viewpoint is colored by not having any children myself. 

Conversely, the Fair Housing Act causes problems if you are targeting families.  If you have a four bedroom apartment and wish to include in the advertising "perfect for families", you cannot, because the Fair Housing Act prohibits that form of advertising text.  How many couples are looking for a four bedroom apartment?  And if they are, wouldn’t they have the common sense to look at the apartment even if the advertising text included the phrase "perfect for families"?   It seems silly to me.

Let me know your thoughts!