Oh Snap. June Just Got Brighter!

June 28, 2019

Given the nice weather, sale open houses are showing better attendance.

An June-no know?
Busy season is upon us. The phalanx of college grads are swarming the city like so many newly emancipated cicadas, and the rental cycle is at its peak.
Given the nice weather, sale open houses are also showing better attendance, though we won't have sold data for another 2-3 months when purchases initiated in June actually close.
(Re-Sale Only, New construction has been notoriously slow, unless it says immediate closings).
We are still seeing stagnation in the 2M+ market, and some new slowing in the sub 900k market. Everybody is looking for a deal, and I can't blame 'em.
So what do you wanna do?
Do you want to stop "throwing money away" as a renter?
Do you want to preserve cash liquidity and rent a home for 2-4 years?
Do you want to become a Monopoly-esque landlord and collect rent every month?
Do you want to buy something sexy for cheap and avoid income tax?
Email me, let's talk!

Rental vs Sale vs Investment
Some people think of rentals as an option for those who can't buy. Others think of it as throwing money away. The reality is that the majority of people rent, and NYC is a magnet for young talent.
Young Talent, with disposable income, or at least strong salaries, comes to NYC for the experience. Work Experience. Life Experience. Metropolitan Experience.
While the former may mean more income, the latter two generally require spending that money for world-class, cutting-edge, or, at least, uniquely curated experiences. Implicit in this experience is a newfound addiction to convenience. And as you can imagine experience and convenience cost many cents.
(Forced that so it would kinda rhyme)

So if you want to dress nice, eat well, and drink sexy... all while having a modern apartment with luxury amenities, like stainless steel appliances, a dishwasher, and in-unit laundry (yes those are luxury amenities), it's gonna cost you. 

Assuming you are 1-5 years into your career, you may not have the funds for a down payment, or you may opt to invest in your own business, bitcoin, or simply a 401k. 

Paying a market rate for a desired product/service isn't a shameful thing. Given the major developments and disruptions to "normal" business, we see that the trend towards ownership versus on-demand access to shared resources naturally extends to the housing space. 

Communal living would be the extreme, but luxury rentals (defined as modern and convenient, not doorman/elevator/gym) seem to be par for the course (shared amenities vs private pool | gym | outdoor space).

Predilection for on-demand access to convenient services, combined with an obsession for luxury goods and experiences, and a fear of commitment due to the statistical possibility of failure (heartbreak, loss of profit) all lead to a scenario where most younger people, sub 30, and some of us still grasping onto our 30's, are more likely to rent than buy, and that's ok.

I am one of the rare brokers who will actually voice the opinion that ownership is a privilege, not a requirement. (You thought I was gonna say right, right.) 

I remember reading a Law School Application Book when I was 28, and in the first 17 pages, it said something like if you can think of a better use for $150k, don't apply.

I would say the same is true for real estate, if voiding your bank account for a down payment is too stressful or too painful for you, don't do it. Of course, real estate is a great way to build wealth, but your home isn't really a pure investment until you sell.

In the meantime, it is a fairly illiquid asset, and if you buy at the wrong time in the cycle, you may just end up breaking even, keeping in line with inflation, or losing.

House Flips, legal AirBNB's, and Rental Properties are true investments, and can be lucrative but also run the risk of costing potentially more time than they are worth.
(What kind of Realtor are you?)
*Jim Gaffigan voice

Whelp, I'm the kind that keeps it real. 

As they say, money is cheap right now, but it's not free. 
If you have been looking to buy a home, now is a good time, but there is still a risk. 

Waiting for the perfect home, or resolving not to buy anything unless it's discounted more than 25% off the original ask, unfortunately, is not the best strategy for actually acquiring property. 

It is a winning strategy, however, for the justification of staying on the sidelines, which, is not so bad, given the abundance of luxury rental products. But you can't build wealth thru real estate as a renter.

In summary, if you want to rent, RENT. If you want to buy, BUY. If you buy a home to live in, realize that you will need to buy a "less luxurious" home, in terms of location, finish, or commute in order to experience gains upon exit. 

Buying something that is popular now, generally ensures paying top dollar, even if temporarily discounted due to oversupply and weak demand. 

Buying something in an underappreciated area, that will remain affordable as the rest of the market recovers, and experience a surge in value once: the Q Train is extended, the Bronx is re-positioned as sub-suburban, or -webkit-centers of work move from midtown to Williamsburg, Sunset Park, LIC.
Yeah but I want to Own Something. 
Make Money. You know. 
Be a Boss/Landlord.

Well, if you want to buy a true investment property, you could buy a starter home outside of NYC, in an area where salaries are not as high, there isn't a ton of "luxury" rental product, or there is a microeconomy of transient workers, students, or tourists.

Buying Multifamily in the Boroughs Is a Great Option

To stay under 1M you need to be in areas with limited Thai Restaurants, Beer Gardens, Curated Vintage/Consignment stores, and Artisanal Cafe's

A quick search revealed East New York, Brownsville, and Cypress Hills in BK.

But then again, new rental legislation passed in Albany could make potential profit thru y-o-y rent increases less tenable as maintenance costs steadily increase.

The New York Times

Disruptive Country Home

You could buy a house within an hour of the city, rent it on a yearly basis, or flex some design/marketing skill and lease it as a mercenary country house. A place where City Folk can buy some meat, bring some alcohol, and unwind a bit (with Netflix, Spotify, and hopefully a pool). This is my favorite.

I love the idea of renting the apartment I like and can afford in the city, and owning a "country home" that I have access to whenever I want, but realistically will only use a handful of times a year, that I can rent to similar NYCers when they get that thirst for nature, chlorinated pools, and "authentic" farm to table dining in a suburban setting.

You could buy pre-construction as a speculator (ideally in a cheaper market) with a limited supply of like kind, and sell upon completion.

Out-of-State Investment

There are also luxury properties in other cities like Miami and Austin, that are much more affordable, and may even allow you to AirBNB your unit or have it professionally managed and leased. *Setting up next Section

Natiivo AirBNB powered condos in Miami/Austin
So people travel more on vacation, are less likely to make a long term commitment to a city, enjoy a fairly even quality of "digitally connected" life in multiple locations, have less disposable income due to increased consumerism, AND are completely fine renting a property that is sexy and meets their preferences for modern luxury and convenience. But who will manage my property, what will be the restrictions on short-term sublets?

Enter Natiivo. AirBNB powered condos built to accommodate investor demand for flexible sublet terms, and market demand for luxury accommodations that better suit lifestyles indivisible by 12.
Natiivo is launching In Austin and Miami, while I have been to Austin and KW is based in Austin, I spend more time in Miami, and have access to friends and family pricing for the launch. Please send me a message to learn more, here are some articles and Soundbytes.

"The 48-story tower, with roughly 600 units, will have about 400 condos and 200 Natiivo hotel units, according to a release. Cervera Real Estate was hired to handle sales and marketing of the condo units. The project, designed by Arquitectonica, is expected to open in the spring of 2022. Urban Robot is handling interior design. Prices start at $300,000."

The Real Deal

A new downtown Miami high-rise being unveiled Tuesday is promising buyers the chance to profit from their luxury units through Airbnb without running afoul of the condo board.

The first Natiivo buildings are planned for Miami and Austin through a partnership between Miami-based real estate company NGD Homesharing and Airbnb. They are slated to open in spring 2022.

"Basically, these are the first buildings built, designed, and licensed for home-sharing,” said Harvey Hernandez, CEO of NGD Homesharing.

Miami Herald
Move to Miami
No Personal Income Tax, tropical weather, luxury housing stock at a discount...
Easy Flight to NYC if you have to come back to take a meeting. 
What more could you ask for?

After several trips to Miami, 1 closed deal, and a lot of relationship/data mining. 
I have compiled a shortlist of newly constructed condos that I can introduce you to, including pre-construction projects that could yield a sizeable profit in 3 years. 

Obviously, I can't quantify or promise that sizeable return, but when a globally recognized luxury brand provides 50,000sf of amenity space, a shuttle yacht to a private island, and world-class design on a tiny sliver of bayfront land, it becomes a bit more believable than just another cookiecutter glass tower.

In short, it is still a good time to buy, if that is your prerogative, indecision and shifting attitudes towards homeownership are making it easier to purchase a home you like, so long as you are not being unrealistic with expected quality.

Hit me up and I will guide you to the best possible deal on the market for your budget and search parameters.

Whether you are looking for w/d, d/w convenience or doorman/gym/roofdeck luxury, while the cost of rent is high, it is relatively cheaper than ownership, with more flexibility. 

I rent. And barring an extra/unexpected $250k and a sudden interest in learning to drive, I will probably continue to do so. 

Being creative in scope can yield new opportunities for investment in personal development, entrepreneurship, and more affordable markets or platforms for fractional ownership.

On a global/cosmopolitan scale, NYC is still relatively inexpensive for everything the city has to offer. Think London, Paris, Shanghai, Singapore, Dubai...

If your target renter is looking to spend 5-8k a month, you can still find property in Manhattan, BK, and LIC. Think 35+ single or with family would rather pay a premium for a quality product that is luxe but not cookie cutter.

If you are looking to buy a multifamily, live in a unit, and rent out 1-3 to defray/offset your mortgage. Still possible between 1M and 2M.

If you are looking to buy a vacation property or self-managed short-term rentals, this is more complicated. Contact me.
Look for new updates to the website, and a new holistic approach to the way you as newsletter enthusiasts can interact with and continue to advocate for the BRIGHTER Brand.

How can I help you?
Buyers: 150k-15M. 
Sellers: 500k-5M. 
Renters: 1800-18k per month.

Areas Served. 
All Manhattan.
All Brooklyn: accessible by train, 1 fare zones.
Queens: LIC/Astoria, Forest Hills, Jackson Heights
Bronx: accessible by train, 1 fare zones.

Property Types:
Rentals: Doorman, Walkup, Elevator, Loft, Townhouse
Sales: Condo, Coop, Condop, Townhouse/Brownstone
Commercial: Office Leasing, Retail Leasing, Investment Sales

Copyright © 2016-2019
Brighter Real Estate Group
All rights reserved.

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