As the number of foreclosure homes continues to soar across the country, home prices continue to slide down. New York City’s housing market, which was generally shielded from price declines in 2008 due to continued prosperity on Wall Street, has now joined the other U.S. cities in home price declines.
The stock market collapse, the mortgage crisis and the glut of foreclosure homes across the country have adversely affected New York City, which is now saddled with 8,000 unsold new condos and an additional 22,000 units scheduled to be marketed in 2010.
These condos were all built to serve young financial hotshots and international investors, but the continued entry of foreclosure homes into the housing market nationwide, the global economic downturn and corporate downsizing have put a stop to most real estate purchase plans.
Residential real estate developers in the city are now awash with inventories, as more and more New Yorkers lose their jobs and fewer foreigners buy Manhattan condos because of the global downturn. Developers are also considering real estate auctions, which are rare in New York, just to move properties and show buyers how low home prices have fallen. The city is rarely mentioned in news related to foreclosure homes, but the nationwide foreclosure crisis has extended its adverse effects on the city.
Real estate auctions were last undertaken in New York City in the 1990s when the city was overloaded with a surplus of co-op condos and interest rates were at two-digit levels. Now New York City condo and apartment builders are planning to use auctions to obtain liquidity. They also have seen how auctions succeeded in rescuing housing markets in South Florida which were devastated by foreclosure homes.
Boston-based Accelerated Marketing Partners, an auctioneer and real estate marketer, has been approached by several developers for possible auction deals. One is a developer who wants to auction five mid-range and high-end condos in Manhattan in Brooklyn. Another is a condo builder who wants to auction units in his downtown building, priced previously at $1,100 per square foot. Now the units would probably be priced at minimum bids of $700 per square foot.
One strategy of Accelerated to prevent condo prices from diving to the price level of foreclosure homes is to auction only several units of a particular building at a time. The other unsold units are marketed outside the auction arena. Auctioneer Sheldon Good & Company will also auction condo properties located in various parts of the city and neighboring New Jersey in May. Among these condo properties are the 17 units of a new condo in one wealthy community of New Jersey.
Author Resource:-
John Cutts has been educated in the finer points of the foreclosures market over 5 years. Read articles about foreclosures information at ForeclosureDeals.com - Your online source for home foreclosures.
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