Plan Carefully to Find your Perfect Manhattan Residence
By Colette Connolly
Many suburbanites feel the lure of Manhattan living; a convenient address to a workplace and easy access to a vibrant cultural scene are two major draws, of course. Or perhaps, after raising the kids, there’s a desire to be “taken care of” a bit more, or to shed a few of the responsibilities of home ownership. In either case, the city–with its energy, buzz and golden opportunities–beckons.
According to the latest census from the American Community Survey, the nation’s evaluation of American households, approximately 30 percent of the more than 5,000 apartments in some of Manhattan’s neighborhoods are routinely vacant for more than 10 months a year because the owners, or renters, have permanent homes elsewhere.
For some empty-nesters, however, the chance to move back into Manhattan (if they had lived there before having a family) or to even experience it for the first time is an exciting prospect.
Ted Holmes, director of sales for the Chappaqua branch of Prudential Douglas Elliman Real Estate, says there has been an increase in the number of local residents purchasing properties in Manhattan, be it second homes or primary residences. In making the transition, it’s important to be aware of the choices and complexities of purchasing in an entirely different housing market. Residential choices are primarily comprise of pre-war co-ops, recently constructed condominiums and to a lesser extent, townhouses.
“Buying Savvy in Manhattan”
Last April, the Chappaqua office hosted a seminar titled “Buying Savvy in Manhattan” that provided participants with tips on how to make a smart investment in the city. Panelists included a number of Douglas Elliman brokers familiar with the Manhattan market as well as real estate attorney Jerry Feeney, CEO of Jerry M. Feeney Residential Real Estate Law, and Jan Scheck, a mortgage banker with DE Capital in Manhattan.
Some of the clients that Elliman’s associate broker and vice president Karen Schneidman works with are over 55. “We’ve always had people buying pied-á-tierres in Manhattan and keeping homes in Westchester, but recently we’ve noticed that they’re selling their Westchester properties and getting larger apartments in the city,” says Schneidman, who works out of Elliman’s flagship Eastside office.
Schneidman says a lot of prospective buyers choose the Sutton Place neighborhood, the wide north/south avenue that runs from 57th to 59th Streets and along the East river south of the Queensboro Bridge. The area is appealing to buyers who still want to maintain ties with Westchester, given that Grand Central train station is only a couple of subway stops or a quick cab ride away.
Downtown neighborhoods like Chelsea, Tribeca and Soho are also popular destinations for older buyers.
Before taking the leap to Manhattan, real estate attorney Derin Edip Walden says prospective buyers need to realize the complexities involved in buying an apartment in the city. “Buying a house is completely different from buying a condo or co-op,” says Edip Walden, who runs her own practice, Guadagno & Edip LLC, located in midtown, as well as maintaining a smaller office in Westchester.
The purchase of a property in Manhattan, adds Schneidman, is a “whole process that one has to be willing to buy into.” Condos, she explains, generally cost more, but with that, residents have more freedom to “do what they want, when they want.”
Purchasing a co-op apartment includes an extensive approval process. “It really is quite daunting for a lot of people,” notes Edip Walden, adding that detailed information is required, including financials, references and more.
Tax and other Financial
The upside, says Edip Walden, is there’s no mortgage tax on a cooperative apartment and no title costs either. And with a much lower real estate tax rate on Manhattan properties, the idea of buying a home there is appealing, she adds.
Scheck says prospective buyers should enlist the help of qualified professionals before considering a move. “It is implicit upon the buyer to deal with mortgage bankers, real estate attorneys and agents who are completely familiar with and have done business in condos and co-ops,” he notes.
From a mortgage perspective, purchasers are required to go through the pre-approval process, just like any other real estate transaction. But once a good, reliable mortgage professional has been found and much of the required documentation has been submitted, Scheck says it’s imperative that buyers are honest with that broker.
“You need to have a thorough, thorough discussion of your financial situation with that person and be incredibly honest,” says Scheck. “Otherwise, you’re not going to get what you need.”
Buyers also need to realize, adds Edip Walden, that while the closing costs on a cooperative apartment are lower than say, a condo or a house, board approval is needed before a closing can take place. “It’s like a whole third party that you’re dealing with that includes you, the seller, the mortgage bank and the co-op or condo.”
Before making the decision to sell all and move to Manhattan, Edip Walden advises prospective buyers to plan their strategy carefully. “My suggestion is that people consult with a team of experts to help them understand the costs, the time involved, the liability and the pitfalls.”
Colette Connolly is a freelance writer who writes for regional and local magazines and newspapers. She also works with small to medium-sized businesses, providing public relations and copywriting assistance through her business, Connolly Communications, located in Bronxville.
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Purchasing a property in Manhattan can be fraught with complications, so it’s important that prospective buyers do their homework. Here are some tips to help you navigate the often difficult buying process:
•Find a real estate broker who is an expert in Manhattan real estate and can show you the best neighborhoods, based on your lifestyle preferences and price range. More importantly, find a broker you can trust.
•Know how much you can afford and obtain pre-qualification well before you begin the search process. Search online for information on the various neighborhoods in Manhattan, in addition to learning about the purchasing of co-ops and condos.
•Know the difference between a co-operative apartment and a condominium, as each one has its own benefits and disadvantages.
•Carefully assess the size of the apartments you’re looking at, making sure the one you choose will suit your living needs. •Don’t get stuck on one apartment. Another one may come up sooner than you think because of the fluid nature of the Manhattan real estate market.
•Consider renting an apartment or house in Westchester before buying in Manhattan. That will give you more time to look around and there will be less pressure to sell an existing home before buying another.
•Be prepared to put your financial life on hold for a while; i.e., do not apply for new credit cards or transfer balances in the hopes of improving a credit score. In
the end, it may work to your disadvantage.[/stextbox]
– Colette Connolly