Foreclosure Home News and Opinion New York Housing Market Exhibits Both Distress and Excess

Distress and Excess Both Evident in New York Housing

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The New York housing market gave Henry Djonbalaj three early Christmas gifts.

And all three came from afar.

“I had three closings today, one was from Russia, one from Ukraine and the other one was from Italy,” said Djonbalaj, owner and broker at Henry Djonbalaj Real Estate in Yonkers, N.Y., in an interview five days before Christmas 2012.

Djonbalaj, who has been working as a real estate agent in New York city’s five boroughs and surrounding suburban counties like Westchester, Dutchess and Putnam since he was licensed in 1984, said that recently he has been working with many European buyers looking for homes both to live in and as rentals.

“They’re the ones that come in with large down payment and have good credit,” he said, adding that one of the pre-Christmas closings was a two-family property that sold for $550,000 but would have sold for about $750,000 a few years ago at the peak of the market.

“It’s so easy to buy a very large property now,” said Djonbalaj, who started his career in midtown Manhattan. “It would actually be cheaper for you to own it than to rent an apartment from someone else.”

Inventory Shortage
Foreclosure processing problems and short sale stalemates are resulting in a shortage of inventory in across the metro area — particularly in highly desirable pockets, according to Michael Biton, who runs Best Value Properties in Queens with his wife, who is a broker.

“There are hardly any available REO. And most of the short sales out there, most of them are in contract,” said Biton, whose brokerage covers Queens, the Bronx, Brooklyn and parts of Manhattan.

Biton said the shortage of inventory combined with increased demand is helping to stabilize home prices and even raise home prices in parts of Brooklyn closer to Manhattan with easy access to the subway system.

“A lot of people, they think the economy is moving up a little bit so they are more willing to invest,” said Biton, who has been working in the New York real estate market for 15 years. “They are willing to pay in Brooklyn higher than the market value right now.”

But Biton warned that the line between a good housing market and a poor housing market in New York can be as thin as a single street.

“You can have one street that is very strong and one street that is very low,” he said, noting that there is always strong interest in Brooklyn brownstones “regardless of the market” while neighborhoods affected by super storm Sandy like Far Rockaway in Queens are chock full of motivated sellers sitting on damaged properties that foreclosures in waiting.

“I’m sure it’s going to affect a lot of foreclosures because people don’t want to pay the mortgage because they have damages and they don’t have insurance,” he said of Far Rockaway. “For investors, for those areas try to find deals because they know people are desperate. … There are a lot of deals next to the shoreline.”

This is an excerpt from the January 2013 issue of the Foreclosure News Report. Subscribe before Feb. 15 and we’ll send you the January issue free. Plus you’ll get the next 12 monthly issues for just $49.95 — 50 percent off the cover price and less than $5 an issue.

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