ONE Manhattan Real Estate

New York City has an endless supply of properties and a neighborhood to fit any personality. It also has a fiercely competitive real estate market where you could get BURNED if you aren't ready for its unique challenges. Whether you're shopping for a starter studio in Manhattan or a brownstone in Brooklyn, check out these tips that savvy property shopper's use

1. Get pre-qualified
Get pre-qualified for your loan before you start house shopping. You'll get a clear picture of what kind of home you can afford, and can focus your search on property that fits your price range. Without proof of your finances, sellers might not think you're serious - something to be extra-concerned with if you're facing a co-op board.

If you're shopping in desirable neighborhoods like the Upper East Side, you'll face fierce competition. The property you've set your eyes on could get snatched up while you wait around to get your financing approved.

Being pressured for time could lead to a hasty decision on a mortgage that could cost you additional thousands over the life of your loan.

2. Shop for mortgage
Shopping around for a mortgage is vital. Many peopletend to think that “their banker” will get them the best rate and terms. That the personal relationship with their financial institution over the years will get the loan approved faster. Buyers often get better rates from a lender who has no relationship with them at all. Please remember that the mortgage business is highly competitive. That most likely the account manager that you trust so much will not be personally involved with your mortgage loan process since that is not his / her department. Like any field in life, you will find some better mortgage broker / banker that is better than others.

The one you will connect with and that will understand your needs and situation and will also find you the right lender for your purchase.

So how do you shop for a mortgage? Like anything else, call a friend who recently bought a property and see if he/she can refer you to the loan officer he/she used. You can ask your broker to find a lending institution that has previously given loans in the building you are buying in. or that your broker has good experience with. You can go online to search for mortgages and you will also get some important education while you search. This process might take you few days but for sure will save you thousands of dollars.

3. Use an agent
Some people prefer to do it alone, locating and negotiating price for property on their own without the influence of a third party. The risk is missing out on a great deal or perfect home simply because you have limited time and resources to sift through all your options.

Finding the right apartment in Manhattan alone can be an impossible task - property moves fast and there are hundreds of other shoppers to compete with. Brokers have their fingers on the pulse of the market and the experience to place people into homes fast. Find a broker you trust and you'll instantly get a leg up on the competition.

4. Get a property disclosure - in writing

In New York anyone with residential real estate up for sale MUST give the buyer a property condition disclosure form before they sign a contract.

If the form isn't handed over, the buyer is legally entitled to knock $500 off the price of the residence. Note: This does not apply to co-ops and condos.

Even if it isn't required for your purchase, ask for one from the seller.

The form will tip you off to any known conditions that could prevent you from buying the residence - everything from environmental hazards to structural damage and system malfunctions.

5. Get a home inspection

It's crucial you bring in a third party to sniff out any structural problems the owners "forgot" to tell you about - or just don't know are there. A home inspector will check everything from how long you can expect your heating system to work before it needs replacing to identifying what needs to be repaired around the property. The inspector may turn up issues that make you take a pass on the home, or make the seller agree to pay for as part of the contract.

Considering new construction or a rehabbed condo or apartment? It's just as important (if not more) to get the property inspected. It might look nice, but corner-cutting contractors could be selling you a shoddy space destined for costly repairs. When you make your offer in writing, make sure the contract lets you withdraw your offer after a home inspector has inspected the residence.


	6. Get the right real estate attorney. It only takes one wrong clause you didn't cross out or put in the contract to make this transaction a very expensive one. Make sure you hire an attorney to review the contract and to explain all the clauses you might not be fully aware of. In Manhattan when you purchase an apartment in a condominium or a cooperative (which is most likely what you are going to purchase) you will be provided by the seller with the building financial statements and offering plans (refer to the glossary in the end of the book) so you can make sure the building is managed well and that the building bylaws which will include the building ground rules from sublet and pet policy's to washer dryer policy comply with your lifestyle. You might find out that one of the rules might be a conflict to your needs and will prevent you from signing the contract and make a very expensive mistake. The ground rule when you hire a real estate attorney is to make sure he / she is familiar with the real estate transaction in Manhattan. Do not attempt to take a less expensive attorney or a family member if they are not experienced in Manhattan!

7. Why are they selling?
When you know what's motivating the seller to put their house on the Market, you'll have a better idea of what kind of offer to make them.

If they're pressed for time - relocating or facing a foreclosure – then you may be able to offer less than their asking price. If they're not under any strain to meet a deadline, they could be comfortable waiting for an offer that matches their asking price.

8. Can you negotiate price?
Most sellers don't bother getting an appraisal when they put their house on the market. They just base their asking price on how much they shelled out originally, any improvements they've made and how much extra they need to put down on another home. While some seller's estimates may be dead on, others could be grossly inflating the price.

Ask your real estate agent to prepare a Comparable Market Analysis (CMA). This holds the seller's asking price up against what other comparable homes in the area have recently gone for.

You could reveal the seller has an unrealistic price, and be justified in making a lower offer. Be careful: making an offer that's significantly lower than the asking price could turn off the seller.

9. Any problems with the neighbors?
If the sellers had to call the police once a week for the last five years you could wind up on the phone with the local authorities on a regular basis too.

When apartment or condo hunting, ask a member of the board or association to introduce you to some fellow tenants, and ask them about their experiences.

10. Walk around the neighborhood
Take a walk around the area at different times in the day. What might appear to be a tranquil neighborhood in the morning could transform into a rowdy scene by nightfall.

11. Any plan for neighborhood development?
Ask the seller if they know of any city or private plans for development. Noisy and, disruptive construction isn't the ideal way to start out in your new home. Watch out for any vacant lots just waiting to be transformed into condos that would change your neighborhood's atmosphere.


	12. Do a final walk-through When you first see a property, the seller goes all out to make it appealing to the eye. Do one last walk-through when the sellers have vacated, or just before the closing. Anything hidden by rugs and furniture will be revealed - and you'll have much easier time getting money for repairs from the seller before the deal is done. 13. Purchase with the future in mind Going for the lowest price might mean sacrificing the money you make back when you re-sell. If you're not planning on staying in your new home forever, you need to consider how desirable the neighborhood and home will be for future buyers when it comes time to sell. Finally, if you got to read this entire book it means that you are both a serious buyer and ready to buy

Ori Degani is a residential real estate specialist. Prior to pursuing his career in real estate, he worked as a restaurant manager and was the owner of successful private label Production Company for many years, where he quickly learned the importance of customer service - listening to the client's needs and

catering to them. His hallmark commitment to service, extensive market knowledge, strong negotiating skills, and true commitment to client advocacy are the keys to his success.

A former Israeli 400M national champion, Ori remains an enthusiastic athlete, who enjoys training and competing. He resides in Manhattan with his wife Sharon and his four kids; Danielle, Ben Tom and Elah.

He can be reached at [email protected]

Glossary of terms

Abstract of Title: A document or report which summarizes chronologically the proceedings and recorded instruments relating to real property.

Said report also typically consists of additional information, including, but not limited to, the property's real estate tax search, Judgments and Liens search, Building Department search, and the Certificate of Occupancy.

Air Rights: Subject to City zoning regulations, the legal right to the air above a building. It is relevant when an owner desires to build upwards or add square footage to a structure. These rights may be sold by Building owners to adjacent properties in order to allow the purchaser additional rights for upward Expansion.

Appraisal: Means of determining the current market value of real property, typically done by comparing the specific property to similar properties recently sold in the surrounding area.

Assignment: The ability to transfer the rights to a written agreement, such as a Contract of Sale or Lease Agreement, from one party to another.

Assessments: The division of responsibility for liabilities of certain costs between the parties to a transaction.

Property tax assessment is the means by which municipalities raise taxes. Condominium or Co-op assessments are the means by which the owners raise revenue for a specific project or need.

Balcony: A private outdoor area included with purchase of real property, typically in the form of a railed deck which extends from the building.

Building Amenities: Unique comforts and luxuries offered by buildings to enhance the owners’ quality of living. For example: doormen, valet services, garages, rooftop gardens, laundry room, wi-fi, etc.

Bank Attorney: The attorney who represents the lending institution when a transaction is being financed. His or her duties include, but are not limited to, conducting the closing on behalf of the bank in accordance with local and State laws, as well as disbursing the buyer’s loan proceeds accordingly.

Capital Gains Tax: Taxes charged on the net profit realized from the sale of a non-inventory asset that was purchased at a lower price.

Capital Improvement: An addition or improvement to a property which will result in an increase in its value, such as a new elevator, a new roof and/or new windows.

Certificate of Occupancy: Also known as “C of O” is a legal document which outlines what a property can and cannot be used for. The Certificate of Occupancy has the power to override zoning ordinances in terms of allowances of property usage.

Co-Broke: A practice in which the seller’s real estate broker divides the commission with the real estate broker that introduces the property to the buyer. It is the practice of sharing the commission between two real estate brokers.

Combined Apartment: When two separate adjacent apartments are combined to make one legal unit. This can be done either through walls, to make a larger apartment, or through ceilings, to create a duplex.

Commission: Once a broker completes a sale of a property he or she is entitled to a payment in the form of a commission. It is calculated as a percentage of the final selling price and is typically six percent.

Commitment Letter: A formal offer by a bank or lender making explicit the terms and conditions under which it agrees to lend money to a borrower over a certain period of time.

Common Area: The area in a building to which all tenants and/or owners have a right to use, such as a lobby, stair case or recreation room.

Common Charges: Fees paid by the owners of a condominium development in order to maintain, repair, operate and improve the building, as well as the common areas.

Concierge: An individual who works at the front desk of a building, not to be confused with a doorman. The concierge signs guests in, accepts packages, and acts as a liaison between guests in the lobby and the tenants and/or owners.

Condominium: An apartment where the individual owns, rather than rents, a specific unit within a building; as well as a percentage of the building’s common area and a portion of the land beneath it. A condominium, unlike a Co-op, is a real property investment which does not require a Board’s interview and/or approval, but does provide the Board with a right of first refusal.

Condo Board: A group of resident-owners elected by their respective condominium community to serve as a governing board and be responsible for enforcing the Bylaws as well as maintaining the common property.

Capital Improvement: An addition or improvement to a property which will result in an increase in its value, such as a new elevator, a new roof and/or new windows.

Cond-op: A building that is in fact a Co-op in every way, except that it operates under condominium rules. There is usually no Board interview and/or approval necessary.

Contract of Sale: A written agreement under which the seller agrees to convey the rights of ownership to a property upon payment by the purchaser pursuant to its exact terms and conditions.

Contract Out: Once a buyer and seller come to terms on a price, a purchase agreement is then drafted in conjunction by both sides’ attorneys. This contract is then sent out to the purchaser to sign.

Conversion: A shift in the way a building is used. For example, a commercial building can be converted into residential use; or a rental building can be converted into a Co-op or Condominium.

Convertible: The process in which a unit is converted into an additional bedroom by means of installing new walls. A window must be present in these new rooms in order for the construction to be considered
legal.

Courtyard: Outside grounds of a building, usually in the center of the structure and surrounded by four walls.

Co-op: A cooperative corporation, also known as Co-op, is a mode of ownership where the individual does not own the unit itself, but rather shares of stock of a corporation that owns the building and most of the times the land beneath it. The unit owners lease their specific units from the corporation under a master lease known as Proprietary Lease. Unlike a condominium, every purchaser must be interviewed and approved by the Co-op Board.

Co-op Board: An elected group of individuals that approve or deny new owners into the Co-op building, while also serving as a governing Board. Akin to a Condo Board, the Co-op Board is responsible for enforcing the Bylaws and maintaining the common property.

Duplex Apartment: An apartment which has two levels.

Deed: The written instrument used in order to convey title of real property from one owner to another.

“Downpayment” Deposit: The initial payment paid by the purchaser for the purchase of real property. This money is given at the time the purchase agreement is signed. Usually it is held in escrow by the seller’s lawyer (subject to the terms of the Contract of Sale) and is customarily 10% of the purchase price.

Due Diligence: A reasonable level of research into the property being purchased on behalf of the purchaser before he or she enters into a Contract of Sale.

Escrow: A process in which money to be used in the transaction is transferred into the account of a third party, also known as an escrow agent. These monies cannot be accessed by the purchaser or seller without the consent of both parties.

Exclusive Listing: A contract which grants one broker the exclusive right to sell a piece of real property fora limited period of time.

Facade: The front, or face, of the building.

Financing Cap by Co-op: An arbitrary number set by a Co-op Board which mandates what percentage of a purchase may be financed by a lending institution. Most buildings allow for approximately 80%
financing, while the more upscale Co-op buildings may not allow for any.

Financial Statement: A report summarizing the financial condition of a person or organization on any date or for any period.

Fixed Rate: An interest rate on a loan which will not change throughout the term of the loan

Flip Tax a/k/a Transfer Fee: A self imposed tax levied on the sale of a Co-op or Condo apartment as a mean of generating revenue. The fee is set by the respective Board and is customarily paid by the seller.

Floating Rate: Different from a fixed rate, a floating interest rate will vary depending on the fluctuating daily or monthly market rate.

Floor-Thru: A unit which extends from the facade, or front of the building, all the way to the back of the building, thus taking up an entire floor.

Foreclosure: When a lending institution, such as a bank, takes ownership of a property due to the owner’s failure to make payments on his or her mortgage.

Full Service Building: A building which has both a doorman and a concierge.

HVAC: An acronym for: Heating, Ventilation, and Air Conditioning. Many buildings today have an HVAC system in order to control the climate in the rooms.

In Contract: The moment the contract is executed by means of signatures from both the purchaser and seller, rendering them both “in contract,” or bound by the terms set forth in the document.

Interest Rate: The fee charged by lenders for the right to use borrowed monies. This rate is calculated from a percentage of the outstanding monetary amount of principal.

Lease Agreement: A legally binding contract which states the responsibilities between a landlord and a tenant for the temporary use of a property.

Lease Assignment: When a tenant transfers (assigns) his or her rights under a Lease Agreement for the use of a property to a new tenant prior to the Lease termination date. Many landlords have the terms of the Lease dictate that the landlord’s prior written consent is required.

Listing(s): Properties listed as either for sale or for rent.

Lease Hold Condominium: A condominium where the owners do not own the land beneath the building, but rather have a vested interest in the building’s ground Master Lease Agreement. However, the owners do own the specific unit as well as a percentage of the building’s common area.

Maintenance: As condo owners pay common charges, Co-op owners pay maintenance fees. These payments cover the repairs, improvements, and operation of the building’s common areas; as well as pay the Coop’s real estate taxes.

Managing Agent: An individual or entity hired by a Co-op and/or Condominium building in order to manage the property.

Mortgage Points: A “point” is a fee that equals one percent of the loan amount and is usually paid to the lender, mortgage broker, or both, in exchange for a lower interest rate.

Mortgage: A loan issued from a lending institution used to finance the purchase of a property. This loan will then be paid off monthly by the borrower over a set period of time, with either a floating or fixed Interest rate.

Mortgage Contingency: A clause in a Contract of Sale which states that in the event that the purchaser Cannot secure a loan in a certain time period or under certain conditions, the entire transaction may be voided and the purchaser will receive the return of his or her “Down payment”.

No Board Approval: When a prospective renter or buyer of a Co-op is permitted to forego the Board approval process of the transaction.

Offer Accepted: When the terms of the transaction offered by the purchaser are agreed upon and accepted by the seller.

Offering Plan: A document issued by a Sponsor or Developer in the process of developing a new building or property to either a Co-op or Condominium. It provides full disclosure of all pertinent information regarding the property.

On-Site Broker: A broker hired by a rental building or new construction/conversion in order to answer questions to prospective tenants/owners and show vacant units.

Open House: When a listed unit is ‘open’ to the public for showing. These events are usually hosted by brokers with the intent of promoting the property and other listings to a large group of people.

Open Listing: A listing not marketed on a co-broke basis, which allows for a larger commission for the real estate broker.

Pet Policy: The building’s set rule on pets; if they allow them, what type of pets, how large, etc.

Pied à Terre: A small apartment usually kept by someone who visits the City irregularly, either for business or pleasure.

Possession: The exact date to which a purchaser can move into a unit.

Post-War: Refers to the architectural style of buildings erected after World War II.

Pre-War: Refers to the architectural style of buildings erected prior to World War II.

Professional Space: Space allocated within a residential building for office use by professionals such as Attorneys, doctors or architects.

Proprietary Lease: In a Co-op, a Proprietary Lease is provided to each shareholder allowing him or her to use a certain apartment unit under the conditions specified.

Payoff Bank: TThe bank receiving the remaining principal balance of the owner's loan or mortgage.

Reserve Fund: Fund managed and set aside by Condo and Co-op Boards for use of special projects and/ or building improvements. The use of the reserve fund customarily alleviates the need to charge an assessment or increase the Common Charges/ Maintenance.

Room Count: The amount of rooms in a specific unit.

Security Deposit: A sum of money tendered before a renter takes possession of a property so that the landlord has 'security' against any damages caused by the tenant upon leaving the premises.

Square Footage: The amount of 1 foot x 1 foot squares that can fit inside the dimensions of a unit.

Shares of Stock: When a Co-op unit is purchased, the purchaser buys shares of a corporation that owns the building by means of stock.

Sponsor:The developer responsible for the construction or conversion of the building to either a Condominium or Co-op. Many times the Sponsor also manages, administers, monitors, funds, and is responsible for the overall project delivery. The Sponsor may be the owner, financier, client or their
delegate.

Short Term Interest: Interest paid to the bank from the date of the closing until the end of that month.

Tax Abatement: Tax abatement is an incentive program to assist Developers and businesses with renovation and new construction projects. Condominium and Co-op tax abatement provides partial tax relief to owners and shareholders.

Time of Essence:A legal term which means that when a party fails to do something by a certain date, such as close on time, it is considered a material breach of the contract.

Transfer Taxes (NYC, NYS): Taxes, customarily paid for by the seller, levied on the transaction of the transfer of property through title, deed or shares of stock.

Unsold Shares: Shares of stock that have not been sold to shareholders and remain the asset of the Cooperative Sponsor although the building has been converted into a Co-op.

Utilities Included: When utilities, such as water and electric services, are included in the common charges or rent.

Walk-up Building: A term used to describe a building which only has stairs installed to reach higher floors. As most buildings today have elevators, pre-war buildings are mostly walk-ups.

Walk Through Inspection: An inspection conducted by a prospective buyer or tenant prior to the closing in order to ensure that everything with the property is satisfactory.