Property Grunt

Thursday, September 29, 2005

Open House Wars: Revenge of the Grunt

Tonight, in the dark of night, after night has shrouded my dark plan in its nightly darkness, I will exact my revenge!

The Brak Show

The Grunt was right all along. I knew a slowdown was in affect and Curbed confirms it with their latest open house reports from people in the field. According to Curbed’s meritorious analysis, Manhattan is on deadly ground while the outer boroughs are hard to kill.

1)Open houses in Chelsea last weekend were slow. more often than not i was the only person at the dozen plus open houses i attended. then again, it was slim pickins and high prices. i'm surprised brokers can even manage a straight face with some of the obscenely priced claustrophobic crypts they're slinging over here.

Sounds like my past three Sundays. I make the effort to keep up a good front but sometimes I want to pull a Monty Python and the Holy Grail and scream to buyers “Run away! Run away!”

2)I'm a broker on the UWS. Have been attending many open houses with buyers in the 1, 2 and 3 bedroom market with price points from $700,000 - $2,000,000. The last couple of weeks the open house apartments have been as bare of buyers as Lizzie Grubman's hoo hoo is of hair (you know the photo of which I speak).

That is really, really bare. For those of you who do not know what we are talking about here is the link. WARNING! NOT SAFE FOR WORK!

3)I'm looking in the $5,000,000 plus bracket. (I managed to sell some large corporation some potentially useful idea.) It seems that this market is chasing the same few qualified buyers. While there is a lot of noise and ink about these properties, they just don't actually ah.. sell. I've seen lofts "new on the market' that have been available for over a year, from one agent or another. I've seen a lot of lofts that seems to make very little economic or aesthetic sense. Fortunately, I'm not in a hurry. I intend to live in this place for a while.

God, I hate you. But the fact of the matter this buyer’s attitude is more common with the proletariat these days. And for the amount of money is buyer is willing put on the table I don’t blame him or her for taking a more patient stance in pursuing a home.
4) Got on offer on a place I'm selling in Clinton Hill within 1 week of it being listed. I didn't attend the open house, but the realtor didn't describe it as manic or desolate. Just called it a good turnout.

What your broker meant by good turnout is that you were lucky that people even showed up so just please take the offer and don’t ask any questions about how sh***y the market is. If you really want to know the numbers just ask for the sign in sheets.

Speaking of Brooklyn the Grunt received the following email from a Brooklynite.

we have no "sub-par" inventory - demand remains strong on the new development front -quality is still selling briskly in Brooklyn.

For the doubters who ragged on my initial reports, eat it. As for the people who supported me, thank you. It is nice to know who my real friends are. Thank you Lock for settling this matter and I am looking forward to more reports.

Blogger Down and Open House reports

The New York Post Article has created a tremendous amount of buzz for Kelly and hopefully this will resolve Kelly's troubles.

An open house APB was recently put outCurbed. I urge everyone who is going to open houses to email curbed at with any information they come across. One of the best indicators of traffic is how many names are on the sign in sheet and feel free to ask questions to the broker. As I have stated before in previous entries I feel very uncomfortable being the sole source of data regarding open house status and I welcome as much input as possible.

Below is the entry that Curbed publicized which presents the exact opposite of what I have been stating.

Happy to report that in Forest Hills Queens, your reports of an open house cold front are completely untrue! Recent Sunday open houses at the co-op where I serve on the board had 100+ visitors and resulted in brisk sales….Of all the open houses I’ve been to across the city (besides new construction)- these by far had the most traffic. The building is a popular pre-war co-op, right in the shadow of the new Windsor Tower, where prices are actually over the $1000 per foot mark.

Forest Hills is a great area but from what I have heard bargains are now far and few. I do not doubt this person's words but do a search in the New York Times for Forest Hills and you will see that the prices have spiked up considerably. I am curious which open houses this writer has been to able to attend all the open houses across the city is a tall order in itself.

As for the Windsor, as the writer indicated prices are over $1000 a foot which is right on the money for Manhattan. But not Forest Hills is not Manhattan. I mean for god's sake, the building is on the boulevard of death not Central Park. It’s obvious that the developers are cashing in on irrational exuberance, which is completely justifiable. But it will not last for long. I wonder how this writer will feel once the foreclosures start kicking in.

One thing that I find amusing is that if you go to the architects website you will notice a similarity with his other creations. Basically he just uses the same design for the majority of his buildings. It is actually brilliant on his part since it requires no effort and people think he's a genius since they don't know any better. It reminds me of the Brady Bunch movie where Mike Brady kept presenting the model of his house to every client.

What the Profesionals say

On September 30, 2005 the Grunt attended a breakfast program titled New York Real Estate Markets: A Professional Analysis (or Is There a Bubble in the New York Real Estate Market?) which was sponsored by the Newman real estate institute and the New York Metropolitan Chapter of the Appraisal Institute.

Three speakers were invited and below are their names backgrounds and an analysis of what they said.

Peter F. Korpacz, MAI, Director in the Strategic Real Estate Research Group of PricewaterhouseCoopers LLP (PwC), has over 42 years of experience in the real estate appraisal, counseling, and research fields. Mr. Korpacz is also the Editor in Chief, of Korpacz Real Estate Investor Survey® and Emerging Trends in Real Estate®.

This guy was awesome. He had this funky array of graphs and charts explaining the whole bubble situation. According to his research residential was definitely taking going to take a hit and that high oil prices was playing a role in the demise of the residential market.He also had a joke about the Amish and elevators. No. It was not offensive toAmish people. But it certainly was funny. You had to be there.

Mr. Korpacz stated good indicators of the market were oil prices, GDP and unemployment. Watch those numbers carefully and we'll have a better idea of what is going to happen with the market. I think the coolest part of his job is that he has the opportunity to speak with top real estate investors around the country and get their perspective on the market.

Robert A. Knakal Chairman and Founding Partner, Massey Knakal Realty Services. Mr. Knakal, a graduate of the Wharton School, has been a building sales broker for 21 years and has personally been responsible for the sale of over 1,000 properties having a total consideration in excess of $3 billion. He is a frequent guest lecturer at NYU, Columbia University, and the Real Estate Board of New York.
Another great speaker.

He had this funny joke about cutting himself shaving and making a speech. One thing I remember from his speech was actually something that I heard him tell before at another speaking event. He had a buyer who purchased a $100 million dollars worth of property and had put down $40 million. The cash on cash return was less than 1%. Mr. Knackal realized this was a rather unusual deal and he waited for it close before he asked the buyer why he was going through with this.

The buyer's response was interesting. He realized he would not reap the benefits of this investment neither would his children but his grandchildren would be quite happy to have those buildings. What this story illustrates is that real estate investing is all about the long haul. One has to be willing to detach themselves to the invesment forsee a day when their descendants of their work.

Knackal felt that comps were completely useless since they are usally 8 months old since the processes of purchasing commercial real estate is a lenghthy one.

Knackal made it quite clear that if you were to ask what the value of a building is he would tell you that he has no idea and that is entirely up to the market.

Frank Nothaft, Ph. D. Chief Economist, Vice President, Freddie Mac.
Responsible for primary and secondary mortgage market analysis and research, macroeconomic analysis and forecasting, Mr. Nothaft is also involved in the analysis of affordable lending activities and issues affecting the housing industry.

He was the final speaker but not be choice. He was coming from D.C and was stuck in traffic. His presentation focused on Katrina and oil prices. He stated that because of Katrina, there would a signifigant spike in construction but we also had to watch carefully at oil.

According to Mr. Nothaft we are definitely overdue for a correction because a boom cycle lastas for 7 years and we are on our 13th year of the boom.

One of the funniest parts of the presentation was the end when one of the audience members who was from Duestche Bank complained about the bushes used for decorations obscured some of the visual aids. I wanted to say that it wasn't the bushes but his blinding bright red crushed velvet pants that was distracting us.

Wednesday, September 28, 2005

Blogger Down: Saving Kelly Kreth 2

Kelly Kreth is in the current issue of the New York Post. The Grunt is proud that he has assisted Kelly in publicizing her story and with exposure from the Post, I am positive her story will go national. Stay strong Kelly! We got your back!



September 28, 2005 -- Dear diary, you just got me fired.
A marketing and public relations guru says she was shown the door at her high-powered real estate job after an ambitious assistant tattled to executives about her online diary.

Kelly Kreth says the Web gripes were anonymous, and that she never identified any of her colleagues by name or the company, Dwelling Quest, in her rants.

"It's been a nightmare," she said with a quivering voice. "They've promoted her to my position, and now they're threatening to sue me."

The 35-year-old businesswoman says her assistant discovered her Web site at, where she's been a contributor for five years.

She says she was booted from the company when they read her rant blasting one of her superiors.

"I never mentioned the company or anyone I worked with by name," she asserted. "But [my assistant] found an entry dated Jan. 11 where I talk about how I feel [a superior] is shrill and loud and classless."

That, says Kreth, led the superior to accuse her of making a threatening phone call to her around the same time.

"Besides getting fired, I had to go in for police questioning," she said.

"I really feel I was fired unethically," she said. "I would never do anything that would hurt my company. I was their publicist."

Kreth claims that the company never had a problem with her performance during her two-year tenure. "I had recently had a work review," she said. "It was excellent."

In August, Kreth said she was offered a job by a rival firm, but that Dwelling Quest CEO Daren Hornig lured her back with a bigger salary a few days later.

Kreth says her assistant was livid about her return and made moves to push her out.

"He [Hornig] knew the situation. He knew I was having trouble with this assistant. He said, if she doesn't work out within a month he'd [find a new assistant]."

"Against my recommendation, they hired her. She was just hating me for taking my job back."

Hornig remembers things differently.

"There were greater issues than a simple online diary," he said. "There were death threats made and harassment threats made inside the office from numerous witnesses."

When asked specifically about the death threat, Hornig would not specifically link it to Kreth. He would only say there was a police investigation.

"We tried to end this in an amicable manner by offering her a severance package and all the necessary things to get another job in the industry," Hornig said.

"And she chose not to accept that because she thought this publicity could better suit her."

Monday, September 26, 2005

Report from the open house front

There was a definite but minor spike in traffic in yesterday's open houses but it waned considerably at the end of the day. Buyer behavior has definitely has become more jaded and honest. At one open house a pair buyers whispered audibly how an apartment I was showing was crap and there were moments where I had to play Karl Rove but it all seemed futile.

They are no longer tolerant of the current prices since it does not reflect the current reality. There is more inventory on the market and interest rates are on the way up. And with all of this chaos ranging from the hurricanes, oil prices and the long-term police actions occurring overseas, it seems that irrational exuberance is running its course. As far as buyers are concerned this seller's market is so OVAH!. Because of this discerning mentality sellers are unable to get away with what they used to.

How did everyone else fare?

Sunday, September 25, 2005

Blogger Down: Saving Kelly Kreth

By now everyone has heard the story from Curbed about Kelly Kreth regarding her doocing from Dwelling Quest. I figured that both parties would part ways. Dwelling Quest would go on forever bitterly existing in the shadow of Citi-habitats and Kelly would get a gig writing for All My Children. But according to Kelly’s most recent entry her former company has decided to pursue a legal vendetta against her.

As far as I am concerned this lawsuit smacks of personal not business interests. From what I have read of the entries there is no mention of the company she works for, neither does she reveal any type of trade secrets. In fact what trade secrets exist for Real estate PR? Does Dwelling Quest have a WREB (Weapon of Real Estate Brokerage) that allows their agents to extract a full fee from their clients? It is all quite ridiculous. She doesn’t even name names and unless you knew the people, whom probably the majority of the people who read her journal do not, there is no way to identify them.

The Grunt has had his share of corporate drama and what Kelly has described in her entries before her doocing, is straight out of anyone’s life in corporate America. Her words were her observations of the behavior and interactions in her former office. Her co-workers were annoyed with what she wrote, which is understandable. But is that grounds for legal action? I don’t think so.

There is definitely a personal motivation behind this lawsuit since they are demanding among other things an apology from her blog. Apology for what? Dwelling Quest has not provided any evidence that she named names or did anything to violate company policy. All they are doing is turning an ugly day in the office into an international incident.

They already fired Kelly with no severance. She is broke and currently has no job prospects in a field that she loves. Enough already. You made your point. Just because you have Kelly on her knees does not mean you can demand a BJ.

I believe Dwelling Quest’s primary objective is to ruin Kelly’s life by forcing her to declare bankruptcy, which is probably the only way for her to protect herself. That is absolutely despicable, because she will never be able to rent an apartment in Manhattan and she will have a very, very difficult time getting a mortgage. Rather than letting her close this dark chapter in her life they want her to remember her humiliation and impotence every time she gets rejected for an apartment.

Kelly is a regular Erin Brokovich who fought tooth and nail from welfare beginnings to get where she is. Which is the reason why the Grunt has decided to rally to her cause. How can you help Kelly? Simple. Tell everyone you know about the injustice she is facing. The more people know her story the better.

Bloggers should also be concerned about this situation because the implications is that Dwelling Quest is making an example of Kelly, sending a message to bloggers like myself and Curbed to step softly.

What this company has to understand is that bloggers are master to no man, no corporation and no government. We go where we want to go. If you don’t like it, well too bad. We are protected by the Constitution. Got a problem with that? Well do the letters ACLU mean anything to you? These lawyers will be more than happy to educate Dwelling Quest on the subject of free speech and not only do they have deeper pockets but they have an eternal hard on for these type of cases. Bloggers, particularly real estate bloggers should be concerned about Kelly’s situation because an attack on one of us is an attack on all of us.

Saturday, September 24, 2005

The Hunt: West Village and air rights

I was reading today's Hunt about the son of a horse farmer who was out to find an apartment in the West Village but ended up in Chelsea instead. There are two points from the article that caught my attention.

So, with a budget of $500,000 to $600,000, Mr. Decker went on the hunt for a one-bedroom apartment in the West Village, preferably west of Eighth Avenue. Many streets there allow parking from 6 p.m. to 8 a.m. - ideal for his reverse commute to Westchester. He would return just at the right time, park his car, and leave so early the next morning that his colleagues commented on how he was always the first one in the office.

Last winter, he visited a small ground-floor condominium on West 10th Street, listed at $540,000. He wasn't ready to buy, because the sale of the farm wasn't completed, but he liked the agent, Isabel Millot of Manhattan Apartments. She warned him that many co-ops would frown upon his plans for a co-owner and his outstanding loans from graduate school.

Apartments in his price range all seemed small or oddly laid out. Mr. Decker hated railroad apartments - "trains, I think they call them," he said. "I'd go into a place listed at $550,000 and go: 'No, God, I can't do this. I am willing to spend $550,000, but not on this.' "

But he did like one Horatio Street co-op, a "pseudo studio" with French doors dividing the room. The listing price was $565,000, but he offered $595,000, which was turned down.

The West Village, he realized, was too expensive, with co-ops priced at around $1,000 a square foot. But Chelsea, about 10 percent cheaper, was close enough. So Ms. Millot took him there.

I hated walking the West Village beat with rental clients because there were no deals to be found in that area. Because it is such a desirable location rents are quite competitive and I have never seen a no fee apartment in that area. What makes it more frustrating is that these prewar west village buildings have very impractical layouts and offer less space then other areas. It is a well-known fact the higher you go up in terms of location the more space you can get for your money.

I have never closed a rental deal in the west village because clients would realize what they were renting was simply the brand name of living in the West Village.

Then, two weeks before closing, he received a letter from the seller's lawyer, suggesting the building might sell its air rights and the closing might be delayed because of related financial issues.

"I was flipping out," Mr. Decker said. "I'm like, 'What's air rights?' I was calling friends saying, 'Hey, buddy, do you mind if I stay in your place for a week or two because I have no place to go?' It's kind of degrading. I'm over 30. I don't need to be sleeping on friends' couches anymore. I thought I was doing well in life - but I'm a bum."

The seller was quite ethical in presenting the air rights issue to Mr. Decker. Depending on the board and seller, some buyers do not know what status changes have occurred with the building until after the fact. I have heard stories about buyers who have slapped with assessments onto to their maintenance because of secret meetings that the board has conducted. In the meantime Mr. Decker should keep his ear to the ground regarding the air rights. Either join the board or get to know the board members. Because whatever the outcome is decided for the air rights it could either help or hurt the building. If it is the latter then Mr. Decker will have at least a heads up of what is going on and should be able to time his withdrawal from the co-op. Of course this is all speculation.

Gritting my teeth for another campaign of open houses tomorrow. There has to be a better way to spend a Sunday.

Thursday, September 22, 2005

A light in the darkness

I usually dread showing apartments that have a tenant residing in them. They range from slobs who leave their clothes and the rest of their crap lying around or their territorial to the point that they refuse entry in an apartment. I make a point not to show apartments while the tenant is still there. But sometimes brokers aren't willing to cooperate because of a buyer’s schedule or they just don't care.

But sometimes, you hit the jackpot. Sometimes you get a surprise that brightens up your whole day. This apartment I was showing had a rental tenant that I made an effort to always avoid. That is until today.

Whenever I enter an occupied apartment at that time of the showing I follow a procedure in order to protect others and myself. One is that I make sure that the broker and buyer know someone is in there so they are not surprised and I make sure that they stand back a couple feet away when I announce myself. I don't know what is behind that door so if there is a big bad awaiting me I want to be able to make a quick getaway and the last thing I want to do is mow down a broker and their buyer. It also gives them a running start to get the hell out of the way. If the tenant is in a bad mood I want the broker and buyer to be out of earshot if the tenant has any choice words about the apartment and my profession.

My experience with tenants has been quite civil because they know the score and I have a talent for placating the worst in people. However there was one time I had to postpone an open house because a tenant claimed no one called them. So I always expect the worst.

When the tenant opened the door an exotic raven-haired goddess greeted me. I mean, she was gorgeous. All of a sudden all of my defenses melted away and my natural charm offense took over. I introduced myself, gave her my card and apologized for any inconvenience. Her sweetness was as abundant as her beauty as she allowed us in the apartment and assured me that it was no trouble at all.

After we viewed the apartment. I ran back to her and asked for her phone number. After all, I wanted to be able to call her in advance in case I had to show it again. Really. That's the truth. Of course I wasn't averse to this going beyond the broker/tenant relationship.

But the Goddess put that to rest when she said.

"Don't worry about it. WE'RE never here."

I hope she was referring to her roommate not her boyfriend.

If you want more details on the juicy apartment gossip at 740 Park, Michael sent me this link. The book will be out next month.

Top 25 rental friendly cities: We're number 89! Awesome!

I just got this press release from Jeremy over at ApartmentRatings which present the list of the 25 renter friendly markets in America. New York did break the top 25. Hell, New York didn't even make top 50. We are number 89. Awriggght! Next time we should shoot for 100. Houston is 39. That might go up considering the influx of evacuees. New Orleans is ranked 75 which is understandable.

Below is the link to the full study which also includes the methodology.
I think what I find intriguing is this aspect of the study.

The PMI Score is from PMI Group's Risk Index published 4/27/2005. This score rates the "likelihood of home price declines over the next two years" using PMI Group's proprietary model. Examining the best cities for renters in combination with the PMI risk index is helpful for prospective home buyers-- a renter in a favorable market with a high PMI risk index may wish to delay their purchase of a home to avoid buying at the peak of the market. It is also interesting to note that many of the worst markets for renters are rated as the most at-risk to decline. One possible conclusion is that in markets where renting is unfavorable, consumers respond by rapidly bidding up the price of houses, leading to bubble-like conditions that earn a high PMI risk index score. However, conclusions regarding the relationship between the renting market and home buying market should be rigorously tested due to strong correlation of various explanatory variables that affect both markets.

What do you think folks?

Nation’s Growing Mid-Sized Communities Among Most Renter-Friendly; Study Reveals Top 25 Cities

AUSTIN, Texas, Sept. 22 /PRNewswire/ -- It's the age-old dilemma for young families, those just starting out and even empty nesters: buy a home or rent? Thanks to declining interest rates and a hot housing market, even die-hard renters have been tempted to buy. But with mortgage interest rates rising, many would-be homebuyers sense that buying a home right now may not be their best decision. However, one question remains: where does renting make the most sense?

Results of a new study from indicate that people interested in renting will find some of the most renter-friendly communities in the nation's fastest growing and mid-sized cities, such as Corpus Christi, Grand Rapids, Raleigh, Portland (Oregon) and Salt Lake City. This is good news for anyone waiting for the housing market to cool off or looking to enjoy the benefits of an apartment lifestyle.

According to Jeremy Bencken, founder and president of, renting may be logical, particularly for people who do not plan to stay for a long time in a community or can't afford to buy in a highly-desirable neighborhood. Additionally, renting an apartment often fits busy lifestyles, as most communities cover all maintenance, and many offer amenities designed to make a renter's life less complicated. is an independent forum for renters to share the unvarnished truth about their apartments. More than eight million renters use the site, which has more than 280,000 unique reviews and covers about 50,000 properties across the United States. Using satisfaction information from thousands of renters, combined with information from the U.S. Census Bureau about apartment vacancy rates and affordability, the study analyzed and created a renter's livability and satisfaction index for 95 U.S. cities and ranked them against each other.

"These great communities offer an abundance of opportunities for families and individuals as well as high levels of satisfaction among apartment renters," said Bencken. "For many, having a home doesn't necessarily mean owning a house. It's great to know that there are extremely livable communities out there that are especially favorable for renters."

Not surprisingly, some larger cities such as New York, San Francisco and Boston -- areas often plagued by high rents and high occupancy -- ranked near the bottom of the list. Bencken said that one of the reasons that the large metros didn't fare as well as their mid-size counterparts is that these housing markets are often stable and tight, resulting in more competition among renters for prime properties. In mid-sized cities, where the supply of housing has grown faster than the population, landlords have to work overtime to attract and retain the best renters.

The list:

1 Raleigh, NC

2 Ann Arbor, MI

3 Fort Wayne, IN

4 Grand Rapids, MI

5 Kalamazoo, MI

6 Athens, GA

7 Lansing, MI

8 Sarasota, FL

9 Charleston, SC

10 Salt Lake City, UT

11 Killeen, TX

12 College Station, TX

13 Greensboro, NC

14 Indianapolis, IN

15 Corpus Christi, TX

16 Oklahoma City, OK

17 Omaha, NE

18 Kansas City, MO

19 Davis, CA

20 Knoxville, TN

21 Portland, OR

22 Atlanta, GA

23 Greenville, SC

24 Cleveland, OH

25 Chicago, IL

For the full list of 95 cities, scores and rankings by satisfaction, affordability and vacancy, see:

Responding to Readers' comments

It has been a bad week so far. I got screwed over at an open house, and then I had to get a full body cavity search from someone who wasn’t going to buy an apartment and then got in trouble for something that wasn’t even my fault. And this all happened in the span of one day. I just want to crawl into bed a with a pint of Ben and Jerry’s and watch back to back episodes of Desperate Housewives.

But I feel I need to address some comments that have made to my blog.

I can appreciate the honesty and anecdotal nature of this blog, especially given that the topic is Manhattan Real Estate. But don't the poor writing and (to a further extent) the generally flawed analysis bother anyone else?

I like this blog, but I feel that many of the conclusions made by the author are based on anecdotal evidence and half-baked logic. I would think that more commentors would be calling the author out on that, but most of the comments are of the "Yeah! Me too!" variety

I am going to make this very clear to you right now. AGAIN! I am not a guru, and I am not an expert. All I am doing is reporting what I see in the field and presenting my analysis of articles and issues that occur within the real estate industry. That is why I call myself a Grunt. Not Mr. Real estate expert know it all.

I am going introduce you to a new term. It is called due diligence which is defined as the process of investigation, performed by investors, into the details of a potential investment, such as an examination of operations and management and the verification of material facts. Bottom line, what it means is to give a through once over on an investment, which also applies in real estate. That means looking at the tile, checking if there are any problems with the property. In airplane jargon they call it a walk around which is to check a plane before flight. One should always look at every angle of an investment to see what other benefits and risks can be uncovered.

I feel the same way about blogs. I think that you should get as many perspectives as possible to get a better understanding of the real estate market. And I will be the first one to recommend other blogs that provide a variety of information about the market.

These include Curbed, Inman news, Realtygram blogger, Brokered and Loftninja. Frances has also got a whole platoon of real estate bloggers, which I highly recommend. Those of you who are buying and investing should also get into the field, go to open houses, talk to brokers, property agents, even doormen to get a better perspective.

Please do not mistake my honesty as a lack of self-confidence or weakness. I am very aware of who I am and I am damn proud of this blog.

Certain aspects of my entries are anecdotal but the ones that aren’t I make the effort to back up with other sources of information that I feel are quite legitimate. Yes. My writing needs work. Like Columbus, you are not the first one to discover that. Joyce has always pointed that out and has been helpful in giving me tips to be a better writer. Perhaps you should take your own advice

But don't the poor writing and (to a further extent) the generally flawed analysis bother anyone else?
That should be doesn’t not don’t. You boob.

Although I did not create this blog to get compliments I do not mind them at all. It is nice to know that I am appreciated since I am not compensated for my words.

I welcome all criticism as long as it is constructive. Anything that deals with personal taste e.g the way I write or the look of the blog itself is going to fall on deaf ears.

As for the flamers and haters, depending on how I feel that day I will either, ignore you, delete your comment or mash you into paste.

I fully reserve the right to cerebrally assassinate anyone who attacks me with malice in his or her heart. You want mercy? Show some first. Slice me with a word and I will hit you with a carload of venomous verbal rage. Make no mistake. I will not engage in flame wars. I will simply end them.

Now that I have concluded tonight’s Ultimate Fighting Championship event I would like to move on to other reader’s comments

I agree completely that it's hard to know where the market is right now. I think it's a little dramatic to be quoting Alien ("Game over, man") after two bad open houses. And what evidence do you have, Grunt, that the market will "implode?" At the very least, I think most people expect a correction because that's the cyclic nature of most markets. Keep in mind that in the long run, there's equilibrium. So to say "implode," I think, is a little extreme. And when you say that the aftermath will not be pretty, what exactly do you mean?

Dude. If you read my blog you would know that my analysis of this market is not simply based on two bad open houses but on my observation of the local and national market. I agree that the market is cyclical in nature but I believe that it will be a lot worse when everything bottoms out. Please just read my blog and go to the other sources of information that I have provided and you will understand where I am coming from when I say it will not be pretty.

You think I am a little dramatic? Once interest rates start to kick up and people realize the true cost of interest only mortgages, a little dramatic is going to be a walk in the park.

I think it's hard to know where the market is right now. Summer/Fall is usually a slow season. Then a pick up around the holidays with contracts and deals being finalized around the New Year. After New Year's Day is when we will know. That is when the market is usually the hottest. If the buyers aren't out in force by that time then next year will be a bust.

I think we might even know earlier watching the open houses and other real estate related activity. However I do agree New Year’s is an excellent benchmark to see where things are going.

I think that's because so many of us are fed up by this ridiculous market and are going to cheer on anyone (especially an insider) who suggests that there will be a return to sanity someday.

Well, thank you. Even though I am considered an insider there are times when I feel as clueless as the next person. I do believe life will get back to normal. It will take sometime, but it will happen.

The Property Grunt is much loved for his honesty and plain talk in what is a (justifiably, in many cases) despised profession. He received honorable mention in Curbed's "hottest real estate agents" competition, including this quote: "I don't know his real name, but I know that there is a contest for leadership of The Property Grunt Fan Club. He inspires motherly, sisterly, and other genuine affection from coast to coast."’

I see you have been reading my press. Thank you. I equally adore Frances and Janis. I was going take issue with the word despised. But sometimes I am surprised by the treachery that occurs in this business.

We 'closed' in June (Upper West Side of NYC) and even though we felt it might be the 'top,' we wanted and needed a we went ahead and bought. Timing may be everything... who really knows when the top or bottom arrives?What does burst/pop truly mean?A leveling of prices....longer time to sell........a decline of 10%...20% in selling price............more units on the market for longer periods of time?In any event, it will be good for everyone, in the long term, if prices level off........30% to 40% declines could hurt the economy big time.

All this has happened, to some significant extent, because of too low interest rates for too long and too much growth in the money supply for too long......too many people overlook the money supply growth, even Greenspan seems to ignore it.....but it creates easy money....too much money chasing too few properties.What will happen in places like California and Florida and Nevada? Same as NYC? What does your first hand experience tell you about price declines....step out on a limb!I enjoy your blog....keep it (well, in a perverse way nowadays) to read.

Congratulations on your new home. Perverse? I was shooting for twisted. But I will take what I can get. You are the asking the right questions regarding what is the top or bottom of the market. No I do not have the answers. Anyone out there willing to take a crack? All comers welcome.

I'm a little suspicious of the consistency of the reader comments that tend to jerk off the author of this blog.

Stop being so jealous. Create your own happy ending.

I don't know, maybe the comments are consistent because the readers LIKE the blog? Duh.

Yeah. Readers do like me so back off.

I find Craigslist next to useless because the listings are so disorganized and the content so poorly written. Make fun of Corcoran/Elliman all you like but if Craigslist FSBO could evolve into something like the content on Corcoran/Elliman, then the market will be truly transformed. At the very least, I need a street address, floorplan, good pictures, open house dates, how long the property has been on the market, co-op requirements, and perhaps a link to comps. And it would be great not to have duplicate listings. If Craigslist could do this and perhaps a comment section from people who've gone to see the open house ala Brownstoner, the brokers would be out of business tomorrow.

That is the dream for consumers and nightmare for brokers. However, there is a solution that can save the broker profession, which is simply to embrace this change. It will hurt at first but I guarantee if the effort is made to adapt to the new world, brokers will be rewarded. I plan on presenting another entry on this in the future.

All right. Back to the salt mines.

Tuesday, September 20, 2005

The uppercrust also gets burnt and a reader comment

While we are all out fighting tooth and nail trying to figure out if the bubble has popped it is nice to know that the rich and famous deal with the same problems. A recent entry of Curbed describes Michael Gross' upcoming book 740 Park about the insane happenings that occur in one of the richest co-ops in the city.

Mr. Gross sent me a link from the Rush Molloy about his upcoming book and I must say I am baffled how he was able to get this much access since co-op's are notoriously secretive. He informed that all is explained in the book. I am looking forward to reading it.

Below is a comment I received from Homer

1 - the bubble is not bursting
2 - gentrification is G-d's way of telling people being pushed out that Darwin was right
3 - Starbuck's is better than your favorite mom and pop store...any day of the week
4 - STFU

My response

1-The bubble is not bursting. It's imploding. The aftermath will not be pretty
2-Gentrification is G-d's way of telling people s**t happens.
3-Starbucks is overpriced and the reason why you think it is better is because there are no more Mom and Pop stores to compare to since Starbucks put them out of business. But it is a great stock nonetheless.
4-Better people than you have tried. And I am still here. Stick to what you are good at like updating your phone book collection and scanning all of your photos of Lucy Lawless lookalikes from the last Xenacon.

Monday, September 19, 2005

Same s**t, different day

The New York Times has published a fantastic article on how sellers are trying to circumvent real estate agents and avoid paying a commission. The Grunt has been following this trend for a while through Inman news and since I already wrote about it I am not going to bother rehashing it. The only thing I will reiterate is that this trend will become the norm in the island of Manhattan. It is just a matter of time.

I am just surprised that it took the NYT this long to write about it.
Below are the entries.

Perfect Storm

I stand corrected on somethings

Outsourcing rental brokers

Sunday, September 18, 2005

Status report from the open house front: BUYER BOHICA NO MORE?

Turnout at the Grunt’s open houses has been lower than turn out at a Pro FEMA rally in New Orleans. Ok. That was bad. But you get my drift.

While I have been waiting for the trickle of buyers I have been pondering the reasons for today’s atrocious results. One could argue that it was due to the traffic created by the Mexican Day parade but I have to disagree. As I have stated before in my previous experiences that I have seen people come through all types of weather and parades to come to open houses. Besides, everyone loves Mexicans. They make the best soap operas.

This is week two of the open house drought and in a previous entry I stated my concern and hoped that this was fluke but it doesn’t look like it. I have heard from one broker who was previewing the open houses in that area that turnout has been low. One of the few buyers who came by made the observation from looking at the major real estate brokerages that there has been more inventory and prices have not increased. This buyer was also just looking. BUYER BOHICA BE DAMNED!

Perhaps what I am experiencing is isolated and other open houses fared better than mine. I can’t go into details of the locations of the opens houses without compromising the sellers but the open houses were held on the east side below 50th street.

I would like to take this opportunity to get as much feedback about today’s open houses. Whether it was in my area or the Upper Westside. Whether you were holding them or you were attending them, any input would be helpful. Either put it in my comments box or send me an email.

Please, do not take this as an opportunity to play “My open house was better than everyone else’s and you all suck.” Or “Grunt, you are a big a**hole trying to scare people.” This isn’t pissing match. This isn’t me stirring s**t up. I am experiencing this first hand and all I am trying to do is help people get a better idea of what the hell is going on.

If this is an anomaly fine, I will be happy. But if this is the sign of the bubble bursting, if this is game over for the market I think everyone has a right to know.

Thursday, September 15, 2005

Bubble back on schedule.

Fed is going to raise rates again. Katrina be damned. It looks like the pop is back on schedule.

As expected, there were some dissenting comments regarding my last entry. But I am glad there is a dialogue going on. Below are some of the comments and my responses.

I went to open house upstate Sunday- HudsonValley - and was only one there. Maybe was too nice a day.
Perhaps will give a lowball offer-since I do like the place and they said owner was anxious to sell.

No offense. You went to an open house in Hudson Valley. I worked a series of open houses in Manhattan. A low turnout in Hudson Valley is a minor setback. In Manhattan it is an utter disaster. However Hudson Valley is actually a nice place live. I hope you get a good deal on the house.

I conducted 3 open houses this past weekend 1 on Saturday which i normally never do but did because of all the interest and 2 on Sunday. All had excellent turnout and enthusiastic interest. Of the 2 one has an excepted offer first showing. This is not to bragg but to inform. You are like chicken little and its getting pretty annoying. You need to refer back to your posting where you detail a course of action to a seller who queried you because she is not sure if she should switch agents and the reasons like, have you priced it right etc. Something tells me the reasons for your dead open house lie in your itemized response to her.

Chicken Little? Then I must be in good company. If you have read my previous entries you should be aware that my perspective on this market is supported by the highest authorities in economics, finance and real estate news including Robert Reich, Inman news, Curbed and the New York Times. By no means am I yelling fire in a crowded theatre. Instead I am recommending people to monitor their kool aid intake.

Something tells me that your annoyance stems from the fact that I am unwilling to march with the status quo of other brokers who keep pushing that it is still a great time to buy and chooses to present another side to this story. What I recommend you do is to figure out what your defect is and make an effort to work on it. Perhaps you should look at other sites about real estate besides mine. I recommend anything by Robert Kiyosaki because it will allow you to ignore what is happening in the real world therefore you won’t get annoyed as much.

I do congratulate you on your recent success. It is obviously due to your hard work not because you connned the owners in underpricing their homes in order to get a quick buck. As for taking my own advice regarding my open houses, you obviously know that although the real estate transaction follows a linear model it’s succesful execution is dependent on various factors that are outside the control of the broker. It doesn’t matter how much of my own advice I take, sometimes it just won’t make a difference. And if you disagree with me on that than I know you are not a broker.

As someone who put a property up for sale Saturday, I am (needless to say) extremely interested in what's going on with the market. My open house went okay, with around a dozen people and more than 10 queries/follow-ups, but based on the frenzied open houses I've been attending as a buyer I was disappointed not to have an offer by now.

To keep myself from freaking out, I've been reminding myself about when I bought a few years ago. I went to the first open house and liked it right away, but since I was buying in the post-9/11 lull I didn't feel in any hurry it would vanish. So I came back with family to check it out a couple times, bid below ask and ultimately bought $10-15K under ask in around 2-3 weeks.

All told, that doesn't seem like a lot of time to sell something worth several hundred thousand dollars! So is this "lull" really the crater we've seen predicted so often or is it just heading back to normal? Any insights from people who've been around the block for longer than the recent boom years would be very, very welcome.

You are going to be fine. If you are motivated to sell and you are doing everything in your power to do so, you will get an offer. Just keep a close eye on the comparables to see if they are in the same price bracket. Best of luck to you my friend.

Grunt, can you please offer some qualification to your observations? General location, size, sq. footage...*price*. Something to make it a a little less anecdotal.

You want qualifications? Go find a doctor. I’m a broker. My qualifications are the street. Seriously, the previous entry came from my own personal experiences doing open houses. I have been doing a series of them in the same locations for the last couple of months and there was always a high turnout until last Sunday. The change was so abrupt which made me quite concerned.

Let's be careful out there.

Wednesday, September 14, 2005

Status report from the open house front

Last Sunday’s open houses were abysmal. Barely anyone showed up. Those that did showed little to no interest in the apartments. And don't bother asking about offers.

The anxiety that has racked buyers and tightened their chests every time they look at the New York Times real estate section has now been replaced with a cold steely intensity of awareness that the market is slowly turning in their favor with more inventory being put on the market and rising interest rates.

One could argue the low turnout was due to the 9/11 memorial but I have seen people come out during blizzards and heat waves for open houses.

This seller's market has forced buyers to experience the phenomenon known as BOHICA. (Bend Over Here It Comes Again), which comes in the form of overpriced apartments and bidding wars. A year or two ago it was not uncommon for sellers to raise their prices during a bidding war to see whom would be the last buyer standing. And some buyers would accept the new price changes. If a seller were to do try that now, a buyer would respond by putting their foot up the seller's ass since buyers are more likely to avoid BOHICA.

I knew this day was going to come I just didn't know when. But my Sundays are going to suck further if this trend keeps up. So is this a sign of the implosion that everyone has been slamming their d**ks on the table about? I will let you know after next week.

Monday, September 12, 2005

Medical Hunt and a salute to Property Day

I think this was the funniest hunt ever by Joyce Cohen because there are certain points that resonate with my experiences in rentals

For Two Sisters, Real Jobs and a Real Apartment

The sisters wanted bedrooms of roughly equal size, and a kitchen with plenty of cabinet and counter space. They wanted to stay on the East Side, near their offices. Their price range was $2,300 to $2,600.

"I had no idea what kind of apartment you could get for the money," Dr. Chung said. So she was disturbed when brokers were dismissive. The first one "laughed at me and told me, 'You are going to have to move to the high 90's or 100's, or change your criteria.' I don't mind when someone tells me the facts, but I don't like it when they talk to me as if I am a total idiot in this condescending way. He never called me back."

Of course they didn’t call her back. First of all her expectations were unrealistic and although I do not justify the agents behavior I understand why they acted that way because not only what Dr. Chung was asking for was laughable, it would require an investment of time to educate her and chances are she might ditch them which did happen.

Dr. Chung's sister was growing frustrated. "I wanted to get the whole process over with and was willing to bite the bullet and just pay the price," Ms. Chung said. "Sun was the voice saying, 'No, there is stuff out there and we can find it.' "

Never say die. That is the attitude you need to have when you are looking for an apartment. She is going to be a great doctor.

"That price range is for shares who have to sacrifice a lot, and they weren't willing to do that," Mr. Hochlerin said. So he grilled them about what they did want: a real apartment in a real building, not a tenement. "I call them 'adult' apartments," Mr. Hochlerin said. "I said, 'I will show you exactly what you want to see, but it will cost you.' "

The more money you spend the better apartment you will get. That is the rule of the rental jungle. When you are looking for an apartment always expect to go a couple of hundred dollars over your budget.

He had a few near misses. He took Dr. Chung to one apartment on East 65th Street that rented for $2,700. It had been converted from a one-bedroom, making the living room small and dark.

Immediately afterward, Dr. Chung had an appointment with someone else. "I felt I was betraying Doug," she said. "I said: 'Doug, I have to tell you. I am going out with other real estate agents.' "

Yes. You did betray Doug. But he forgives you. There is a saying in the business that you never want to be the first broker and this is the reason why. At least she was honest. I have been in many situations where I find out my clients have been cheating on me when I have spoken to other agents in my office and finding we have been working with the same person.

It was a brilliant strategy on Doug’s part to let Dr. Chung go off on her own albeit risky because she might do a deal with another broker however she might become frustrated and go back to Doug which is what happened. However doctors are fantastic clients because they are flush with cash and are willing to pay a premium for an apartment. And landlords love doctors since they are never around because they are so busy which means usage of their property will be drastically reduced. Which is the reason why Doug overlooked her discretions. Besides she’s really cute.

The other guy met her a block away, and took her to the very same apartment. She was indignant. "He was trying to make me think it was in a high-rise on a nicer block," she said. "He was misleading me."

This is another reason why one should stick with one agent especially one who is part of a large franchise company because thy all have access to the same listings database. So it is counterproductive to use multiple agents unless a particular agent has insider knowledge that no one else has.

Another item on my s**t list on rentals was showing the same apartment they have seen with another agent. Whenever that happened it filled me with a sense of dread since I realized it was pretty much futile showing them anything else. And unless the client was willing to take drastic action e.g raise their budget or look at another area they were pretty much spinning your wheels.

I would also like to take this moment to salute a site has come to my attention called Propertyday. No. It has no association to the Property Grunt. Straight from Jolly old England this is a real estate news site that covers all four corners of the world and every aspect of the industry from commercial, residential and REITS. I highly recommend this site for those who are starving for real estate news from around the world.

Sunday, September 11, 2005


Today is September 11th. Let us remember the fallen.

Thursday, September 08, 2005


Pets are always a big issue in Manhattan since they are the difference of keeping someone sane or mentally disturbed. However we often take for granted how pets can cause possible problems in the real estate business.

NEVER, EVER, EVER BRING YOUR PETS WITH IF YOU ARE A BUYER! You are asking for trouble. At a recent open house a couple brought their lovable Jack Russell terrier and although they did not even ask permission to bring the dog I allowed them to enter the premises. I figured it would be no problem since the building allowed pets anyway. Really bad idea.

Upon seeing the dog, another buyer refused to enter the apartment because she had a fear of dogs and only entered when one of the owners held the dog tightly in her lap. This setoff a chain reaction of fears in my head ranging from what if the dog took a dump in the apartment or what if it bit a customer. I kept a close eye for any one legged Jack Russell calisthenics or squats but luckily they left without incident.

That open house brought back flashbacks with my past interactions involving pets and real estate. I had one owner who had an adorable golden retriever who was great company to me. I would wait for buyers by petting him as he nuzzled his head on my lap. When the buyers would arrive he obediently went to his corner and stayed until the showing had concluded. I miss him.

Cats although equally lovable are definitely higher maintenance, particularly with their personal business. A dog can be taken out but cats need a litter box and until the owner cleans that out it will stink up the apartment.

One owner had this cat that exhibited passive aggressive behavior since it would come up to me purring and rubbing its body against my leg. As soon as I would kneel down to pet it, it would use me as a scratching post.

Whenever buyers came by to see the apartment I was always on edge and would warn them about the Tasmanian Devil but they would ignore me and pet the cute little kitty. For some reason it never attacked the buyers. Maybe it just hated me.

It is always best for sellers to take the pets out and douse the apartment with Febreze whenever they have to show the apartment. You never know if you are dealing with a buyer with severe allergies.

Tuesday, September 06, 2005

Everybody relax. It is just that time of year

This was from Curbed.

Scary Real Estate Trends: Rental Bidding War
Tuesday, September 06, 2005, by Lockhart

While the immediate future of the residential sales market is murky, it's good times for owners looking to rent out a flat. Blogger Callalillie reports on a recent hunt for a new rental apartment in Park Slope:

We began the day visiting an open house in Park Slope-- a beautiful 2BR brownstone floor through, nicely renovated with a great kitchen. The price was right, but when we got there, we realized that swarms of people had visited and that there would most likely be a rent bidding war... End Result: Nothing is really available over this Labor Day stretch. Furthermore, since when do bidding wars happen with RENTALS?
Yikes. Hey Grunt, any intel on this phenomenon?

Below is my answer.

Tell everyone to chill out and cut down on smoking so many bowls. That is what is getting everyone paranoid. What Callalillie experiencing is perfectly normal for this time of year.

First of all this is one of the heights of the rental season due in part to students coming to the city and people coming back from vacation. So the demand is definitely there.

As we all know, beginning last year there was a chain reaction from the insane residential market. Because prices were so high alot of buyers decided to sit this one out until things cooled off. This was great news for rental brokers because the assumption was that these buyers would now become rental clients. There was one problem. Alot of buyers simply resigned their leases which resulted in a huge lack of rental inventory on the market which became evident when the spring arrived and ton of rental clients entered the market but it was slim pickings all around.

Landlords are definitely enjoying this bounty and have turned the tables on clients. This has forced clients to become more creative in their housing needs. Which means expanding their search to other boroughs.

Although I do not do business in Brooklyn I have frequented the area many a time and I have noticed a significant number of young people who live and enjoy themselves in the area. So I am not surprised that Callalillie is experiencing this type of commotion. Manhattan is just too damn expensive for the majority of us. Besides they have better pizza in Brooklyn that is definitely worth the 2 bucks.

Do rental bidding wars occur? Yes. If a landlord gets a group of very qualified clients then clients have to step up to the plate and offer more to the landlord. Some clients just offer a higher rent outright in order to secure the apartment.

Is this always the case? No. Sometimes the landlord will take the first qualified person they can find because they do not have the time or patience to go through all those applications.

I strongly advise Callalillie to keep looking because they might find that deal. Even though there is a ton of demand in Park Slope, a landlord will get a ton of applications that are chock full of bad credit reports or idiot clients who attempt to haggle over the rent despite not having a leg to stand on. If you have excellent credit, a secure job and do not play games with your landlord you should be fine.

You could also wait till the winter when the rental season usually ends and landlords are more generous with negotiating with the rent. It is up to you.


On a side note, good apartments always go fast. What is left over for the winter may not be as pleasing. You will always be facing risks wherever you go.

Monday, September 05, 2005

Holy Grail! More like Holy S**t! Part 3

Despite Alexandor Bandon's bollixing report on rental brokers she worked with a positive development has occurred regarding Tim Taylor, the truly nice guy or as I called him the truly desperate guy, who broke the Citi-habitats rule of providing addresses to Alexandar.

As I predicted Ms. Bandon's exposure of Mr. Taylor's transgressions displeased his masters which did not bode well for his career. Grunt heard on the wire that a crew of Citi-Habitats managers were on the verge of beating Tim senseless with phone books and working him over with rubber hoses before dumping him on the curb. That was until his office was bombarded with calls asking for Tim's services. It seems that Tim's positive disposition won him a large following of clients since the publication of the article.

Not wishing to kill the golden goose, his manager has spared his desk however I would not be surprised if they have penalized him by witholding a number of his deals.

Tim, if you are reading this my best advice for you is to take advantage of this stay of execution. Use your fiteen minutes of fame to knock out as many deals as possible. Hopefully you have broken your six. Ditch the craigslist and go straight for the New York Times ads and advertise the best rental properties you can find in your area. Use this as a springboard to go into sales if you haven't already. You have been given a second chance so run with it.

The Grunt stands by what he has written in Holy Grail! More like Holy S**t! and Holy Grail! More like Holy S**t! Part 2. I do empathize with clients who experience difficulties when finding an apartment but to simply blame the broker for this situation is to simplify a situation that is so much more complicated.

Friday, September 02, 2005

Real Estate Blog Squad Press Release

For Immediate Release


PROPERTYGRUNT has participated successfully in the launch of THE REAL ESTATE BLOG SQUAD, joining 40 bloggers and journalists in a national forum for discussion about real estate. The group's initial focus is to aid in relief efforts connected with the current Gulf Coast tragedy. Next month, THE REAL ESTATE BLOG SQUAD will cover the National Assn. of REALTORS® annual convention and exposition in San Francisco. The blog is located on the web at this link.

THE REAL ESTATE BLOG SQUAD (A Human Experiment) is featured in national press reports. Blog Squad members have appeared recently in BusinessWeek Online, Investors' Business Daily, MSNBC/Newsweek Online, Time Magazine Online, CNN, Inman News, and The Los Angeles Times.

"THE REAL ESTATE BLOG SQUAD is off to a great start," says the Grunt, "It is a noncommercial venture, an exercise in citizen journalism, and if offers us an opportunity to make a difference in real estate on a national level and right here in New York."

"THE REAL ESTATE BLOG SQUAD is not about making a buck; it's about making a difference,"