Introducing My New Team!
Please meet Ariane, Emily and Barbara. We’re getting better, not just bigger!
Emily Shepodd is a dynamo: always on top of the latest listings, and ready to help me assist buyers at every step. Emily hails from Seattle, but after 6 years in Brooklyn nobody knows better what the latest, best, new thing in town is.
Ariane Dembs has been a top rental broker with Corcoran for three years and is joining me as rental specialist and operations manager. Ariane recently bought a 5th floor walk-up in Prospect Heights and now has quads of steel. More important, she knows how it feels to be on the other side of the table.
Barbara Katsnelson has been with Corcoran for five years and will lead marketing and advertising efforts for our listings and our team. She brings extensive project management and new development sales experience. Like me, she believes in the importance of creating and maintaining meaningful relationships with clients. Barbara will be working on all our marketing pieces, including a monthly newsletter!
One name is missing: Mary Klein. After six amazing years as my right-hand woman, Mary’s getting married and moving to California! While I’m sad to see her go, I couldn’t be happier about why.
Rate Talk with Rates and Real Estate:
The topic du jour surrounds interest rates, and the FED’s continued push to increase the FED Funds Rate, which in turn drives up consumer rates, most impactfully, mortgage rates. The basic consensus is that as the US economy improves and finds sure footing with low unemployment and widespread confidence, rates will continue to tick up.
The FED met again on Wednesday March 15th and raised the Funds rate by 25 basis point to a target rate of .75 to 1.0%. Now, this does not mean that interest rates on mortgages went up by .25%. Rates barely adjusted as there are many economic factors that contribute to mortgage rate movement and some of Wednesday’s expected rise was already priced into mortgage rates,.
Prior to the election, rates were at historic lows, now with some strong economic influences, rates have ticked higher and will likely continue to do so, especially considering the FED’s bias to increase interest rates. That said, the impact at present is minimal, but could very well be more impactful later this year..
On a 1MM mortgage, if you opt for a 30 year fixed, payments went from on average $4,490 to $4,702 a monthly increase of $212. On a 500K mortgage, again on a 30 year fixed, payments went from on average $2,245 to $2,351 a monthly increase of $106. These differentials will increase of course along with the expected rate trajectory.
Time to Buy, Time to Sell?
If you are selling, it’s key you have the largest pool of buyer candidates. Lower rates enable a larger segment of the population to afford homeownership. As rates drive higher, buyers who obtain a mortgage now need to spend more on a monthly basis. Once their monthly liabilities go up as a result of higher rates and monthly mortgage payments, they may be forced to look at lower price points, since they are now spending more on a monthly basis for the same mortgage loan amount they were seeking. This likely means that if you are thinking of selling in the near future, there’s no time like the present.
As a buyer, when you can afford and obtain more house for your dollars, as a result of lower rates, you have more flexibility to find the right property that may include more checklist items. If payments increase in line with rates you may find yourself curtailing your price point to adjust for the anticipated or actual higher rates.
The Corcoran Report 4Q16 Brooklyn
Cross any bridge from Manhattan to Brooklyn and you’ll see new buildings on the rise in every direction. The sale prices for those properties rose too, pushing Brooklyn’s year-over-year average sale price up 16%. While luxury new development sales pushed prices to record highs, the resale market showed smaller gains than we’ve seen in recent years with average prices up 8% for coops and 12% for resale condos. An increase in inventory certainly contributed to the slower growth (for example, condo inventory rose 23%) and resulted in longer time on the market for many properties. Paired with rising interest rates, there was a subtle shift in the market in 2016. Check out the link to the 2016 Year-End Corcoran Report for more detailed information on 2016 sales.
What does this mean for both buyers and sellers this spring?
Seller: My usual advice applies now more than ever: do not overprice your property! Concerns about rising interest rates will drive buyer urgency. And properties with asking prices that are smart and well-supported by previous sales will continue to sell fast and for the highest possible price. Buyers will worry about overpaying: if they see a price that’s out of line, they won’t even bother to come look. 2017 will be a strong market for sellers who stay realistic and don’t get crazy with their pricing.
Buyers: Educate yourself about what’s out there and what properties are really selling for. See as many homes as you can and pay attention to how quickly they sell (we can help you with this, of course!). By doing this, when you find the place that’s right for you, you can feel comfortable bidding fast and strong. Want to avoid a bidding war? If a property has been on the market for 4-5 weeks, the seller may already be contemplating a price drop and will be willing to negotiate. Sometimes, a good offer in week four or five can preempt a price drop and you’ll pay less than you might be forced to pay a week or two later after a lower price sparks renewed interest.
Thinking of Moving to New Jersey?
For years I’ve worked with clients who decided to sell their Brooklyn homes and head to New Jersey for more space at a more affordable price. But I’ve never been able to offer any guidance about a broker I KNEW WOULD BE GREAT when they were ready to buy. I’m happy to report that is no longer true! Please meet the team of Heather Gilheany and Suki Marsh-Shikiar. Heather and Suki focus primarily on towns around the midtown direct train line and a large majority of their clients come from Brooklyn!
Heather Gilheany & Suki Marsh-Shikiar
505 Millburn Ave
Short Hills, NJ 07078
Continue the Conversation
Yossi Notik at JPMorgan Chase is one of my favorite mortgage bankers. He is a great source of knowledge and always delivers white-glove service. I encourage you to call him with any questions and for a no cost pre-approval.
J.P. Morgan Chase
NMLS #: 36820
718.233.3883 – w
917.572.2124 – c
277 Park Avenue, 9th Floor, New York, NY 10172