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Volatile, Shmolatile

11/01/2011, By Leigh Kamping-Carder

Volatile, shmolatile

November 01, 2011 07:00AM

Microsoft cofounder Paul Allen kicked off last month by closing on the $25 million purchase of the penthouse co-op at 4 East 66th Street, where he already reportedly owns an apartment on the 11th floor. Allen appears to have had the inside scoop on the property, since it was not listed.

The buy was a standout price for the month, but Allen is not the only purchaser taking the plunge. Some buyers remain gun-shy and wary of the up-and-down financial market, but others have grown accustomed to the volatility, brokers said.

While September was characterized by fear over the economic fluctuations, brokers said, buyers in the last few weeks have started to make decisions faster (although foreign buyers reeling from the debt crisis continue to wait on the sidelines). Brokers also noted that lowball offers gained little traction and bidding wars started anew at some properties.

"These swings in the marketplace no longer have a jolting effect on homebuyers and investors in New York City," said Robert Varvara, an associate broker at Miron Properties.

Or, as Michael Signet, executive director of sales at Bond New York, noted, "No [further] talk of S&P downgrades has buyers back in the mood to buy."

Traffic has slowed compared to the same time last year at new developments, observed Jacqueline Urgo, president of the Marketing Directors. (This could also be a result of the changing seasonality of the Manhattan marketplace -- see "Autumn market: No longer what it used to be.") But the number of shoppers who become buyers is higher, she said.

Urgo interpreted this as a sign that the home-seekers who remain in the marketplace today are those who are committed to purchasing.

"We can assume that real buyers are in the market and are making buying decisions," Urgo said, "whereas a year ago, they were unsure and still debating whether or not it was the right time to pull the trigger."

Steven Leon, a vice president at Citi Habitats, said buyers making lowball offers are now likely to be disappointed.

"Those still with the mentality of getting a deep discount on a property," he said, "are starting to realize they are losing out to more reasonable purchasers willing to pay close to ask, or at ask."

Meanwhile, in the rental market, industry professionals continue to hum the "landlord's market" mantra, noting the lack of inventory and the end of concessions. But in the last month, a new type of renter has entered the market, brokers said.

For the most part, students and renters with lower budgets have locked up their accommodations. Now, savvier customers with more to spend -- couples, discretionary movers and higher-earning business professionals -- are shopping for rentals, brokers said. Law and consulting firms, for example, tend to hire new employees later in the fall, while recent college graduates often settle in August and September, in line with the academic calendar, noted Douglas Wagner, Bond's executive director of leasing.

With larger companies opening offices in the city, Argo Real Estate agent Sheryl Berger is seeing a number of individuals relocating for work, with renters particularly interested in Chelsea, the Meatpacking District and the Flatiron District. Last month, for example, Twitter opened its official East Coast headquarters in Midtown.

The average monthly rent for a New York City apartment is now $3,267 per month, according to a rental market report by RentJuice released last month. In west Soho, the city's most expensive neighborhood for tenants, average asking rents hit $7,782 per month, while in Tribeca and Central Park South average rents were $5,151 and $4,309, the report said.

Those moving here for jobs are facing an uphill battle in finding housing, since many renters who moved during the recession are staying put, unable to find the same kind of bargains, Wagner said.

Citi Habitats' Leon said that nearly all of his tenants have decided to renew their leases, even with a rent increase, rather than move.

Still, despite the much-discussed landlord's market, tenants continue to haggle over new leases, from the rent to the broker's fee to the conditions of the apartment, said Miron agent Julia Perez.

In the last month, Wagner has encountered renters in at least six instances who have secured landlord approval to move in to new apartments -- on prime blocks on East 10th Street, West 16th Street and elsewhere -- only to turn around and try to renegotiate the rental rates. Not one of those six tenants has succeeded, he said.


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