Our Services - Buying, Renting Out, Selling



Buying:

In New York, agent fees are paid by seller.  Despite this, the fiduciary responsibility of the buyer's agent is to the buyer while the fiduciary responsibility of the seller's agent is to the seller.   If a buyer is not represented by an agent, then the seller’s agent, whose loyalty is to the seller, keeps the entire pre-negotiated commission.  Hence, it is in the best interest of the buyer to have agent representation to help identify the right property and negotiate the best price.

All agents, through the real estate trade agreement (Real Estate Board of New York), have access to the entire inventory of properties for sale.  For example, if there are 10,000 properties for sale in Manhattan, every agent will have access to the 10,000 listings.   The role of a buyer's agent is hence to identify the right property and not to merely provide access to view.  As such, the brokerage community strongly discourages the buyer from using multiple agents as this would create confusion.

We recommend that a potential client interview several agents and then decide on one.  As we will be 100% focused on helping our client identify the right property, we in turn expect client loyalty.  This expectation is consistent amongst all good brokers.

Outlined below is the buying process we go through with clients.

  • Evaluate objective - purpose, long term plan, attributes
  • Identify and arrange properties to view
  • Perform analysis and due diligence
  • Objectively present upsides and downsides of each property
  • Negotiate
  • Recommend financing source: 
(i) US bank
(ii) International / overseas bank
(iii) Both options above would finance overseas and international buyers
  • Recommend attorney:  Closing, forming company to hold property
  • Recommend accountant:  Tax structure
  • Recommend property manager for building buyers. 

If financing is used, closing costs (bank, attorney, accountant fees, mortgage tax, title insurance) are approximately  5% of loan amount.  Buyers need to show required down payment, usually 20 to 50 percent of property price depending on whether the property would be a primary residence, vacation home or investment property.  In addition, banks may require proof of liquidity cushion, eg 10 - 18 months of monthly payments in liquid assets.

If the buyer pays in cash (no financing), then closing costs would be about 2 percent of property price.

It typically takes 3 months from property identification to closing.  At closing, all parties - buyer, seller, bank, attorneys, brokers, would come together at a table.  A lot of paperwork would be  signed and funds would be provided to the seller in exchange for the buyer getting legal title to the property.  The deal would be completed at the table and usually no future follow-ups would be necessary.



Renting to tenants:
For investor clients who intend to rent out the property, the next step is to market to potential tenants.  Here are the steps we perform.  One of the risks of owning rental property is tenant delinquency.   This means special attention needs to be paid to screening potential tenants with regards to credit quality. 

  • Market property for rent
        - Personally show your property to potential tenants/their agents
                   - Convincing presentation of property's upsides
- Internet marketing (Website, Broker system, Streeteasy, Trulia)
                   - New York Times
- Professional photography
                   - Professional floorplan
                   - Google marketing
                   - Social media marketing (Facebook, Twitter)
  • Screen potential renters / tenants (FICO credit score, references, salary, work history)
  • Process paperwork
  • Arrange for tenant move in
  • Set up automatic transactions for tenant to automatically deposit monthly rent checks into owner's account. 
  • Rental fee in New York is usually paid by the tenant.  But sometimes to make the rental unit more attractive to tenants, the owner may pay the rental fee.
  • The system above removes the need for condo owners to pay monthly property management fees, anywhere from 3% to 9% of gross rent.  Since Manhattan, New York condo tenants are usually high income and good credit quality individuals, there is usually very little management necessary.  As the need arises where the tenant requires attention, we will be the point of contact to help resolve the issue at hand.
  • Refer building owners to property management companies.  Property management fees typically 3 to 9 percent of gross rents.



Selling:
  • Price property based on market value
  • Market property to domestic and international buyers
  • Leverage media popularity to gain exposure for the property
  • Marketing Strategy:
                   - Personally show your property to potential buyers/their agents
                   - Convincing presentation of property's upsides
- Internet marketing (Website, Broker system, Streeteasy, Trulia, Zillow)
                   - New York Times
- Professional photography
                   - Professional floorplan
                   - Google marketing
                   - Social media marketing (Facebook, Twitter)
                   - Open houses for broker previews
                   - Open houses on Sunday catering to buyers
                   - Media interviews at property (as opportunity permits)
                   - Broker/potential buyer exposure events at property (as opportunity permits)

  • Refer to 1031 exchange sources for owners who wish to defer tax payments by exchanging to a like-kind investment property.  This is an effective portfolio building strategy.
  • Seller would pay broker fee to market the property.  This fee would be split 50/50 between brokers from both sides.




Disclaimer:
Legal, financing or tax information furnished above is not by a qualified attorney, mortgage professional  or CPA.  It is not a representation, guaranty or qualified opinion.  Always consult your CPA or attorney on tax matters as individual situations differ.  Buying New York Property


Amenities at luxury property
New York, New York Property
Copyright 2011 Castle Avenue Partners @ Rutenberg Realty
127 E 56 ST, 4TH FL, NEW YORK, NY 10022 USA212.682.8494hello@castle-avenue.com

Castle Avenue Partners
Manhattan, New York Properties
Property Blog