News: Brokerage

Housing has costs, and those costs rise - by Aaron Weber

Aaron Weber

Over the last 8 years, taxes increased 61% for a 10 unit building (with 3 rent regulated units) in the Chelsea neighborhood of Manhattan that is managed by Weber Realty.

Payroll expenses have jumped for supers and administrators as minimum wage in NYC increased 88% from $8.00/hr in 2014 to $15.00/hr in 2020. Maintenance and repairs also rose higher as exterminators, plumbers and electricians charge more for labor.

For the same 10 unit Chelsea building, insurance premiums increased an average of 8.12% per year over the last 3 years. Higher premiums are due to rising building costs, supply chain disruptions, and greater losses from floods, hurricanes and wildfires in recent years. Property insurance is also 15% more expensive for landlords than a standard homeowner policy because insurers are taking on additional risk due to the presence of renters.

Heating oil prices jumped 77% in just 2 months for a 40 unit residential building in Morningside Heights. According to Weber Realty Management “It cost $6,034.00 to fill up their oil tank on 1/10/2022. Two months later, on 3/11/2022 it cost $10,653.86 to fill up the same tank (which needs to be refilled every 2-3 weeks).”

In addition, between 2020-2021, cleaning expenses rose 40% due to COVID concerns. The stay at home mandate also drove up water usage by 10% during the same time period. Also in the summer of 2021, many pre-war buildings suffered damage from Hurricane Ida that required thousands of dollars in repairs.

Aaron Weber is owner/property manager with Weber Realty Management, New York, N.Y.

READ ON THE GO
DIGITAL EDITIONS
Subscribe
Columns and Thought Leadership
A fresh start - by Shallini Mehra and Amit Doshi

A fresh start - by Shallini Mehra and Amit Doshi

For the past several years, the New York City multifamily housing market has been defined by disruption. The combined impact of the HSTPA rent laws and a sharply higher interest rate environment has fundamentally reduced
The anticipated effect of Basel III and ISO 20022 implementation on commercial real estate - by Michael Zysman

The anticipated effect of Basel III and ISO 20022 implementation on commercial real estate - by Michael Zysman

July 1, 2025 is the deadline for US banks to begin to adopt Basel III banking standards and July 14, 2025 is the deadline for U.S. banks to adopt ISO 20022 messaging standards. Both will have a significant effect on the banking and commercial real estate (CRE) finance sectors.
Tri-state capital  migrates nationally amid  regulation pressure - by Reese Weaver

Tri-state capital migrates nationally amid regulation pressure - by Reese Weaver

New York tri-state multifamily investors are increasingly reallocating capital to less-regulated markets across the U.S. as rent control and legislative risk erode returns at home. With over 60% of New York City’s rental housing stock classified as rent-stabilized, the traditional value-add model — buying under-performing buildings,

The death of the generic offering memorandum: What buyers expect in 2025 - by Kimberly Zar Bloorian

The death of the generic offering memorandum: What buyers expect in 2025 - by Kimberly Zar Bloorian

There was a time when an offering memorandum (OM) was pretty bare bones, some photos, a few bullet points on income, and a rent roll thrown in at the back. That used to get the job done. Not anymore. In 2025, buyers are sharper, faster, and more selective. They’re looking