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THE MICHAEL GRAVES TEAM AT COMPASS |
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From the Desk of Justin Rubinstein |
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Rising Mortgage Rates Don't Have To Be a Downer |
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We’ve had it so good for so long. Mortgage rates have remained at historic lows for over 5 years, hovering around 3%. But when Jerome Powell of the Federal Reserve announces prime interest hikes any day now, buyers and sellers can expect an increase in mortgage rates of half a basis point all the way to one point. That’s not such a big deal when you consider the average 30-year mortgage rate at the start of 2006 was 6.41%. But…even a small fraction of a point can put a crimp on your buying power. Let’s do the math From a home buyer's perspective, as mortgage rates increase, affordability decreases. Consider a home listing for $2.5 million. At current mortgage rates of roughly 3.5%, a 30-year fixed mortgage would require monthly payments of $8,981. However, if rates go up just a half point to 4%, that monthly payment becomes $9,548. This decreases your purchasing power by $150,000. Your dream home is out there, but you’ll have to look harder to stay within your new budget parameters. Many of the sellers that I represent are eager to close deals before the inevitable rate increases kick in. Why hold out for six months or longer waiting for the “perfect” moment, when there’s accelerating buying activity right now? Sellers are feeling confident as they sense a rebounding real estate market. I’m happy to report, sales at nearly all price points soared in the fourth quarter of 2021. Let’s talk about smart options There are several ways to maximize your buying budget. For openers, focus on buildings with lower common charges - the monthly “nut” that pays for necessities like staff, insurance, amenity areas and a building’s reserve fund. Common charges can fluctuate widely, and this is where the due diligence of your real estate agent can make all the difference. Do you value a building with a pool, game-room and full-size basketball court? A building with fewer amenities can look even better when you factor in its lower common charges.
Here’s a safety-net worth checking out: consider a long-term rate lock. This rate protection option keeps your interest rate from rising between the time you apply for a mortgage and the time you close on your loan. Most rate locks cover a period of 15 to 60 days, but can extend up to 180 days. Longer-term protection can be a savvy move when you’re shopping for a new-build apartment, where construction delays can push back your closing by several months. Let’s look forward to the year ahead We’ve seen a lot of life uncertainties over the past few months – but we continue to marvel at the inspiring perseverance of our great city and its determined residents. People move to New York and stay in New York because there’s no place like it. A small uptick in mortgage rates…we’ll all get through it! So here’s to a year of health, happiness and beautiful homes.
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My Newest Listings |
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New Development of the Month |
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Two Fifty Six North Ninth |
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From A Perfect Storm To Hitting Its Stride: What 2022’s Buyers Can Expect In New York City’s Real Estate Market |
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This past year was remarkable for its deal volume, but below the surface, several trends emerged which may be instructional heading into the new year. |
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Focus on Design |
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Park Avenue’s iconic Lever House tower is being redeveloped under the architectural guidance of Skidmore, Owings & Merrill (SOM), the building’s original architects... |
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My Recently Closed Deals |
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115 East 9th Street, Unit 14D East Village Co-op Status - Closed Upper East Side Co-op Status - Contract Signed 23 East 22nd Street, Unit 21 Flatiron Condo Status - Closed 221 West 77th Street, Unit 15 Upper West Side Condo Status - Closed 78 South 3rd Street, Unit 1 Williamsburg Duplex Status - Closed 151 West 21st, Unit 9E Chelsea 2-Bed Condo Status - Contract Signed |
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Fourth Quarter and December 2021 Market Reports |
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Justin Rubinstein is a 15-year veteran of the New York City real estate marketplace, who quickly gained attention from industry veterans and clients alike as a motivated and knowledgeable professional whose focus is on providing the best customer service possible while negotiating for and protecting his clients with dogged tenacity. This tenacity and hard work ethic has proven fruitful as he has successfully negotiated over $600M in real estate transactions to date. As a member of the record-breaking Michael Graves Team, Justin has enjoyed representing buyers and sellers of trophy properties such as the Time Warner Center, landmarked West Village townhouses, and new development penthouses. In each instance, his clients come away from the experience with a strong appreciation for his dedication and expertise... read more |
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