I hope everyone is well and, as always, the first thing I would like to say is thank you! I like to keep these email updates brief and use newsletters as a medium of expedient yet genuine communication for clients both old and new. I will also use this space to provide you with fresh perspectives and actionable insights pertaining to what we are experiencing in the current real estate market. Last winter I included a link to some data points from UrbanDigs. Unfortunately, I believe this may have been more confusing than helpful as I may have failed to provide adequate context by not including a link to the more comprehensive report. For those ardent data aficionados and neophytes alike, I don't think there is a better site for mining data on the NYC real estate market than UD.
Our last email brief pointed out that we had experienced a slowdown in the market starting in August 2015. It was quite pronounced and difficult to identify or explain the root cause. However, 3 days after Easter Sunday, chaos erupted.
On March 29th, for no apparent reason, my phone and email activity went crazy! That week alone I received phone calls from nine new clients inquiring about our services, all of whom signed up, and of those, five now currently in contract. We also heard from many of our previous clients that had been quiet during the preceding months and many of them are now in contract or actively looking. Since that one week in March, business has been booming . We currently have about twenty deals in contract and eighteen that have closed. Remember, we don't do any advertising, so please continue to honor us with your referrals, as they are the lifeline of The Burkardt Group and greatly appreciated!
I would not say that we are back to the market highs of 2014, but we are humming along quite nicely in a way reminiscent of 2015. Most offers below $2.5M eventually wind up in a call for 'best and highest'. Brooklyn remains very active; I think I could honestly say it can be harder to get a deal done there than in Manhattan. We have a few deals in contract that are in the range of $3M-$5M and we are definitely experiencing a bit less of the fierce competition we are seeing for homes priced sub-$2.5M. However, one caveat is that my generalizations mainly apply to homes in established neighborhoods with no major negative conditions. I recently watched a 410 F2 studio with a 500 F2 terrace trade in what would appear to be above $1.8M range. While this home had no real kitchen, it did have a prime location, and that appeared to be the salient quality. This was a bit disconcerting, as it reminded me of 2007, the precipice of the inevitable financial collapse, when irrational exuberance reigned supreme. Where does it go from there on the re-sale-- $2M?! Happily, this has been the exception, not the rule.
I watched the 'Big Short' last night. It was a pretty good flick that brought back some bad memories! During the time before the markets collapsed in 2008, I was interested in making some real estate purchases but was also reading some contrarian financial blogs while trying to juggle that against what I was hearing from a good friend and seasoned broker who literally told me (when I suggested perhaps it was a good time to watch and wait before buying another home) that he might be "priced out forever" if he waited. Well, this was enough for me to quit my firm and start the disruptive (before disruptive was a buzzword, that is) firm that I ended up christening 'The Burkhardt Group', advising folks to rent and offering them a discounted commission that was based on factors beyond rental price. It certainly appears that my little upstart company succeeded in filling a niche that was yearning to be utilized. It was not until around late 2009 that I began representing buyers and the model evolved to what it is today, with over $350M in sales.
To sum things up: the market appears to be healthy, certainly fueled by low rates, but still not what one would call easy money. If you're looking in Brooklyn, I think Ditmas Park, Sunset Park and Greenwood offer some opportunity for current value and future appreciation. Michelle Williams's purchase in Ditmas Park may finally give that 'hood the boost it needs to shine. Look what she did for Boerum Hill!
This market has been hot for a long time. Don't chase properties because of excessive pressure from multiple buyers, exercise constraint. Opportunity is available for those with patience. My favorite scenario is identifying homes that have been overpriced, sit and get 'stale'. The herd will stay clear, wondering what's wrong, even in this bull market. Catch the seller at the right time and you can make a deal.
We are planning to start listing homes for sale. We have an effective plan in place and I have recently begun speaking with sellers. Please feel free to call me to discuss what we can offer you. If you have a home with no material negatives, then correct pricing is 80% of making it happen.
I hope you all have a wonderful 4th of July! One day we'll throw a big party and invite ya'll!