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Weekly News (October 11, 2017)

1. Trump’s new tax reform might be negative impact to New Jersey residents 

  • Reform will cancel exemption on certain property tax → increase tax pay
  • Average exempted tax amount: Palisades Park → $15,907 / Fort Lee → $25,153 / Englewood Cliffs → $48,303 / Tenafly → $60,697
  • Example: Tenafly → $60,697 = 21.4% of AGI (Adjusted Gross Income)
  • NJ State average exempted amount: $21,500
  • In NJ State, 41.4% → Itemized tax report

2. A child died when the balcony collapsed

  • Residential house balcony collapsed on 10/05 around 5:00pm in Perth Amboy
  • 2nd floor, 13 FT balcony was troublesome → when collapsed, the child (9 year old) fell off and died on the spot (13 year old relative survived)
  • Tenant notified the owner many times → Owner did not respond
  • Owner is under investigation by local police

3. Malcolm Harris got convicted 

  • Sentence: 42 month in jail, 3 year surveillance, $500,000 forfeiture for fraud and money laundering
  • Dennis Ban, Real Estate broker, is planning bribing to Middle-East foreign officials for selling ‘Landmark 72’ in Hanoi, Vietnam. He gave money to Harris as a middleman and Harris used for himself
  • Dennis Ban’s trial will be held on 02/05/2018 (Dennis Ban is a nephew of former UN Secretary General – Ban, Ki Moon)
  • Ban, Ki Moon’s brother fled to Korea

4. Roosevelt Island becomes hot place to go 

  • Total 147 acre / 14,000 population: Originally only jail and hospital on the island
  • Many High rise apartment and co-op built for last 15 years
  • Tram cable car connects to Manhattan in 4 minutes / Ferry takes 35 minutes / F line served
  • 266 unit apartment built on 480 Main Street in 2015 /Very low vacancy rate: currently only 12 units condo/co-op on the market (Average listing price: $1.16 Million, lowest studio co-op is at $499,000)
  • Roosevelt Island School (PK ~ 8th) / Cornell Tech Center opened last month
  • Average sale price for residential property → $1,005,000: 59% up CMT $660,000 in 2012
  • Studio Rent: $2,300~2,500 / M

5. Manhattan Luxury Apartment becomes less popular .혻혻

  • In 3rd QT, luxury apt sales slow down
  • Highest condo in West Hemisphere ‘432 Park Ave’ (Billionaires’ Row) shows low volume sales → Only 77% sold (82 units) among total 106 units (This year only 12 units sold)
  • Median price $2.8 Million → 23% down CMT last year
  • Closing time (listing to closing): 101 days → increased by 27.8%
  • Sold at 5.5% lower than listing price (2.9% last year)
  • By contrast, co-op sales for middle class increased by 5%

6. Home price jump in July even as sales level off 

  • Home price steadily climbed: 5.9% up in July from a year earlier
  • Sales of both new and existing homes slipped over this summer which might slow price gain → But, demand remains strong → pushing the price up
  • # of existing homes for sale (inventory) down 6.5% on the past year
  • More people (buyer) move into the market →Reasons are: Low unemployment, paychecks rising modestly, Mortgage standard easing
  • Also Price up because 1. Limited supply of land, 2. lack skillful construction workers, 3. Not enough new homes built

7. Why the inflation rate is still low?

  • Fed Chair Yellen is acknowledging Fed is puzzled by the persistence of unusually low inflation
  • Fed is delving into questions why inflation rate is remained less than 2% chronically
  • Officials expect that the forces keeping inflation low to fade away eventually, but she concedes Fed might have to adjust its assumption
  • Most annalists expect rate increase in December → Federal says it depends on incoming data

8. Commercial Property Vacancy Rate increase → Slow down?

  • Commercial VR increased continually for a few years → 3rd QT, VR stays with 10%: Same as 2nd QT (Survey from 22,000 commercials in 77 cities)
  • VR increased in 34 cities (in 2nd QT, 39 cities)
  • Big shopping mall VR → 8.3% (0.2% Up)
  • Reasons: new shopping center supply decreased / Restaurant, Market, Fitness center increased (Health oriented new fitness/health centers increased) → Experiential Entertainment stores
  • 3rd QT, Avg. commercial rent → $20.74 / SF (1.8% Up from last year)

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Stephen Lee

He has been in Real Estate industry in about 20 years and has been Broker of Record for 9 years. His experience includes residential, commercial, and property management. Prior to involving with Real Estate business, he has been involved in the digital communication equipment industry utilizing his engineering background and education, including running own company. He has established C Land Realty in 2011 which has grown to staffing over 100 Real Estate agents and the annual transaction amount of over $110,000,000 today.

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