Congratulations to Barbara Fox, President of Fox Residential Group, who was recognized by the readers of the New York Observer as one of the most powerful people in New York Real Estate!  See below for the abstract of the article from the June 2^nd paper.

 

The Most Powerful Person in New York Real Estate: You! (Sort Of)

June 2^nd, 2009

By Tom Acitelli

 

 

For the first time, we gave readers the opportunity, in unscientific online polls at Observer.com, to tell us who they thought were the most powerful people in New York real estate. Readers were given four names per category to choose from. The Nos. 1 and 2, by category, below!

 

Boutique Residential Brokers
Barbara Fox, Fox Residential; (tie) Michele Kleier, Gumley Haft Kleier; Leslie Garfield, Leslie J. Garfield; and Mark David Fromm, Mark David & Co.

Brad Loe

A friend of mine recently quipped that he hadn’t yet benefited from the downturn in the economy. Given the current zeitgeist of gloom, I found his attitude refreshingly positive. Think of the economy as the weather and remind yourself that you can have a good day even when it’s raining outside.

 

Whatever the dire climactic conditions, your personal situation is unique. This dynamic market, still in transition, offers opportunities on all transactional sides. Take a minute to figure out where your potential upside is. Locate your inner shrewdness and act while others are still fearful.

 

BUYING

Inventory is high. There hasn’t been such a selection of properties for ages. If you’re looking for an apartment on a particular block or if it’s outdoor space you want, an eat-in kitchen, southern exposure or extra closets, you’ve got more chances than ever to hit the nail on the head.

 

Prices have come down. Bloomberg reports that average NYC home prices dropped 10% in the fourth quarter of 2008. If you’ve been waiting to get into the market, start shopping now!

 

Sellers are negotiable. According to Miller Samuel’s Manhattan Market Overview Report, the listing discount (i.e. the spread between the asking and contract price) was 7.3% in the 4th quarter of 2008, as compared with 2.7% the prior year. Some buyers are afraid of offending a seller with a low offer. Don’t be. Take the risk and find out how much wiggle-room there is in the price.

 

Rates are low.

If you’ve still got your job and good credit, then take advantage of exceptionally-low interest rates. As of writing, they were hovering around 5.70% for 30-year fixed. There is talk that government action will make even more attractive options available soon.

 

You have the luxury of time.

Goodbye bidding wars! In the market’s heady days, you had to make an offer on an apartment at the first open house just to get your foot in the door. Now, if you see a great place, chances are you can go back a week later with your contractor or your aunt’s third cousin’s ex-boyfriend to get another opinion. By looking now, you are ahead of the curve and face reduced competition from other buyers.

 

SELLING

Values have soared.

Ok, all of these pros for buying may make a seller depressed. But let’s get real for a moment. When I started selling real estate in 1999, you could buy a one bedroom for around $300K on the Upper East Side. At the market’s height, similar one bedroom apartments could go for as much as $800K. If values have multiplied more than two-and-a-half times in the past decade, it’s only reasonable that they come down somewhat.

 

Home prices relative to stocks.

In the same ten-year period, the DOW hit 10,000, went up to 14,000 and is now hovering around 8,000. You were better off investing in a Manhattan apartment at any time in this period, even (and especially) the last few months. Friends of mine sold their condo at the height of the market and then, unfortunately, put their profit into securities and watched their portfolio tumble 50%. So even if apartment prices are down 10-20%, that is still less of a loss. And, in the meantime, you’ve had a great place to live.

 

Total picture.

Many are predicting continued declines in home prices for 2009. This scenario makes an argument for selling now. Lock in your gains—or your losses—now. Then be poised to take advantage of the favorable market for renters. If prices slip further, you’ll be ready to jump back in.

Jody Sperling

Exactly 20 years ago today, January 23, 1989, Barbara Fox created Fox Residential Group.  Back then George H. W. Bush was just sworn in as President, Rain Man won Best Picture, a little show call Seinfeld premiered on NBC, and Barbara was working out of a small townhouse office on 78th and Madison with four brokers.  Twenty years later, while Seinfeld has long since past into reruns, Barbara has grown her firm into a force in Manhattan residential real estate.  She now manages over 40 brokers, moved into a bigger space (right around the corner from the original location), and is an industry leader.  So tonight, raise a glass and toast Barbara Fox and Fox Residential Group.  Here is to at least another 20 successful years!

Brad Loe

While there is no denying that New York is clearly seeing declining values in real estate, I would like to point out something significant that may not be widely recognized by the national media or analysts and economists. Something that may ultimately save, and perhaps even help the purchase market in New York to prosper, while the rest of the country flounders.

Did you know that Manhattan has among the lowest percentage of home ownership in the nation? According to the REAL DEAL DATA BOOK 2008, there are 738,644 households in Manhattan. Of that, 563,589 are renters while a mere 174,179 own a home. On a percentage basis that means that 76.3% of Manhattanites are renters. As a result, the domino effect seen in markets like Florida and California, where qualified buyers are unable to sell their departure residences, is largely mitigated in New York City. Renters looking for bargains could ultimately prop up the market, as has been the case in decades past here when market conditions have caused prices to swoon.

There is an added favorable factor today, which may be different from times past. Aggressive rent stabilization and rent control laws in previous downturns often kept otherwise qualified buyers out of the market because the low rents they paid for housing did not compare favorably to purchasing an apartment. In the last 10 years, however, significant changes to these laws have altered the landscape in New York and far fewer people are protected by these laws. So, the economics of buying are more favorable than ever for renters.

Of course, the ultimate upside of the large rental population potentially converting into buyers is that, unlike in other markets in the nation where renters are often not qualified to be buyers, Manhattan is among the most affluent rental markets in the world. Whereas it can carry a stigma in other cities, renting is an acceptable alternative to owning in New York.

So now, more than at any other time in recent history, over three quarters of the households in New York will have the opportunity to buy low without having to worry about selling low.

Amy Bader

The Current State of the Manhattan Residential Real Estate Market
Barbara Fox, President Fox Residential Group, Inc.

The most frequent question I’m asked nowadays is, “What’s happening in the Manhattan residential real estate market?”  To pre-empt your question, here’s how I’d reply.

Listening to some market commentators, you would think the current situation we’re facing represents a once-in-a-lifetime experience — a perfect storm of credit crunch, bank failures, mortgage foreclosures, unemployment, halved bonuses, and Bernie Madoff.  While I fully recognize the seriousness of the recession we’re facing and the large financial losses many of us have suffered, I’m comforted by the knowledge that we’ve lived through many other hellish real estate markets — including the mid ’70’s when New York City was on the verge of bankruptcy — and I’m convinced that in many respects, this current market bears strong similarities to other market downturns.

To my mind, the situation comes down primarily to a matter of sellers and buyers — who’s around and what’s their state of mind.  Right now, sellers are more plentiful than in recent years providing substantial inventory.  The situation with buyers, however, is more complex.  Buyers with an immediate need for housing are still on the scene.  Their highest demand is for units with purchase prices under $2 million.  But at the high end of the market, where the purchase occurs less from need and more as a result of voluntary upgrading, fewer buyers are in evidence.

As 2009 proceeds, I think we’re going to see more and more buyers take the plunge into the market – especially those who were priced out of prior markets.  The typical buyer is likely to expect that with all the bad news around, he’s going to end up with a substantial discount from an inflated asking price.  No one wants to feel he’s buying in a softened market and still paying top dollar.  And it’s at discounted prices that the balance between buying and renting tips most obviously in favor of buying.  In short, the buyers can be viewed as acting rationally under all the circumstances.

It’s the sellers who haven’t yet caught up to the realities of the present situation.  Too often, the seller has convinced himself that his property has a certain value and is reluctant to admit that this valuation was based on an inflated market.  As a result, he’s hesitant to reduce his price to a level that’s needed to attract a buyer for the property.  But that’s what sellers have to do.  Whether justified or not, buyers are expecting a 15-20% price drop from what similar properties sold for in the first half of 2008, before they can become comfortable with a purchase.

Let’s face it, value in real estate is determined by the price someone will pay for a certain property at any given time.  I believe that wise sellers will understand this and act accordingly; that buyers will acknowledge there are limits to the price reductions they can achieve; and that at least by the second half of 2009, the market will start to come together and regenerate the volume of prior years.

Even when the market does come back this year, we’re not going to see for a while the kind of year-to-year appreciation that we’ve been spoiled by in past years.  At some point, though, this too will return.  Buyers can’t be looking for a quick fix however; rather, they should adopt a longer term perspective on potential gain. I believe that, over time, an investment in real estate is eminently worthwhile and will prove to be better than securities or other alternatives – plus which, you can live there and enjoy your investment while it’s appreciating!

Meanwhile, in this tricky 2009 market, you need to use a broker whose skills lie in understanding the nature of the market, strategizing about value, bringing together sellers and buyers, and negotiating the purchase price.  We at Fox Residential Group pride ourselves on our focus and abilities in these areas.  If you’re going to be in the market this year, we hope you’ll give us the opportunity to demonstrate our expertise.

Barbara Fox