How the sale of apartments and lofts in New York works
For those approaching for the first time to purchase a property in New York, the procedure is very easy, always if followed by an expert society capable of addressing the buyer in the right way. Once that the property is identified, whether it is a loft or an apartment does not make a difference, a first verbal offer is formulated via the real estate agent which represents the buyer part. Normally the negotiation occurs between two agents, one for each party involved in the deal. In this case, the agent of the seller will represent his client, meanwhile the other agent will protect the buyer in order to guarantee an impartial negotiation of price and of terms which will be subsequently reported in the purchase contract. Once that the agreement regarding the price of the property is made, the respective lawyers will occupy themselves of the writing the contract, which will take around one or two weeks. When the contract has been drawn up and it has circulated between the parties, simultaneously with the signing of the contract, the buyer will have to transfer a deposit corresponding to 10% of the purchasing price on the bank account of the lawyer by which is represented. The deposit will remain a warranty on the lawyer’s account. The deed will take place after 30/45 days, during this time period the lawyer will carry out the checks on the property. The purchase price will be paid in the moment of the closing. The buyer will have to transfer the total amount to the bank account of the lawyer on time. It will then be the lawyer that during the deed, will pay all the parties involved. (seller and real estate agencies)
Why to buy a house in New York
To buy a house in New York means to buy a house in the economically safest city in the world, New York could be defined as the real estate safe par excellence. All the fundamentals present at the base of a good real estate investment are present, such as, political stability, economic and cultural power. When evaluating a good investment is important that all of these fundamentals are satisfied. New York represents the worldwide capital city of business and will maintain this status over time. Investing in New York means to protect the capital and watch it increasing over time. Historically, going backwards by 10 years a property is revaluated by almost 100%, the highest revaluation that we could possibly expect in the real estate market.
What implies to purchase a luxury apartment in New York
Purchasing a luxury apartment in New York means to invest in a trophy asset. According to us, a trophy asset could be also represented by a single apartment if contextualized in a premier building and a prime location. Every property could be considered a trophy asset, even a studio flat if contextualized in a high level building and a top location. We must consider that the buyer will pay a tax on lux, called “luxury tax”, which is applied on properties with a value higher than 1 Million of dollars. The luxury tax corresponds to 1% of the value of the property. To purchase a luxury apartment means to safeguard your assets by putting them in a safe place. The profitability, even on more luxurious properties, could still be interesting thanks to a dynamic renting market and an extremely low percentage of vacancy, which is calculated to be lower than 5%. To lease a property, If the buyer does not want to use it personally, means to have the possibility to decrease significantly managements costs, which could be important in a property of such a high level To invest in New York today means to enter in a very positive market phase, in a dynamic market and with growing prices. Our opinion is that it is more convenient to invest in market with a positive trend rather than in a suffering market, unless that this negative drop is caused by a contingency of the moment and not from the lack of political, economical and social fundamentals which are supporting the market and that must be the base for an investment. Even a city such as New York could be speculative if pointing towards growing areas of the city such as the neighbourhoods of Brooklyn (for example Crown Heights e Bedford-Stuyvesant, to cite some of them) or the areas at the north of Manhattan like Harlem (Morningside Heights, East Harlem, Central Harlem) and Washington Heights. The expected revaluation is important thanks to the tendency of homogeneity of prices in all the neighbourhoods. What makes the real difference in the purchase of an apartment in New York is especially the tenor of the buildings. American people love services and they appreciate structures that offers many amenities: pool, gym, reception, conference room, 24 hours security, parking. The neighbourhood is a personal choice, dictated more by the type of environment rather than a substantial difference. A real city centre does not exist, every neighbourhood and area has it centre and is a micro-community. The entrance price is relatively expensive, going from a minimal investment of around $500,000. For Europeans is particularly a good moment thanks to the favourable euro-dollar exchange rate.
Message to investors on New York, by Angelo Cinel, WIRE president
New York represents a location for more reflexive buyers, it is a market for the investors who want to “travel” in a curve of safeness and protect their capital investment. The typical investor in New York is not speculator, but somebody who is willing to keep the apartment for the long term, which is targeting to reach an important capital gain, contrarily to the speculator who is interested in the short term. To the detriment of a low rental profitability, not superior to 3-4% per year, the revaluation is extremely important, by not much inferior to 10% yearly. For this reason, whoever buys a property in New York sees the value of the investment almost doubled in 10 years. The last 10 years trend confirms the previous statement, as the average revaluation of properties was superior than 8%. Why to invest in New York? New York satisfies all the fundamentals of economical nature (economic activity), politics (political power) and social (intellectual power). New York features a strong presence of international buyers, other than local buyers, which are the ones supporting the market in case of an internal economic crisis. The New York market has shown stability and strength in all the historical and more recent economical crises. Those elements justify and motivates a real estate investment in New York, however, the truth is that the verification on the subsistence of the previous conditions is valuable in every real estate market and should be at the base of every conscious real estate purchase.