Dutch Realtor? comments on the crazy NYC Real Estate market

Translated from QUOTE 15:35 15-02-2015

Hugo van Dijk (49) is a Dutch Realtor? in Manhattan; the most extreme Real Estate market in the world. “2015 could be a record-year.” We asked him questions about Tax Evasion, the differences between Condo’s and Co-op’s, the Record Sale in the City and Madonna’s Co-op Board’s rejection.

The record sum of $100MM was paid recently for an Apartment in Manhattan. New Yorkers are mad because the new Russian Owner received a huge break on his Real Estate Taxes (https://www.nytimes.com/2015/02/02/nyregion/in-program-to-spur-affordable-housing-100-million-penthouse-gets-95-tax-cut.html?partner=socialflow&smid=tw-nytimes&_r=2)

“The 421-A Tax Abatement Program has been in effect since 1971, originally designed to stimulate New Construction that includes “affordable housing”. It is still being used for that purpose, to stimulate New Construction, but nowadays however, the affordable housing part is being left out and it results in such crazy Tax advantages for which it was not intended. Besides, the price of $100MM paid was insane enough. The criticism by the NY Times articles (https://www.nytimes.com/2015/02/08/nyregion/stream-of-foreign-wealth-flows-to-time-warner-condos.html?ref=realestate) on the LLC-Corporate construction (https://www.dos.ny.gov/corps/llccorp.html) is really unfounded, because it allows Real Estate property owners protection of their personal assets and is available to anyone, not only the wealthy. Yes, you can compare the current situation with that of the tax-deductibility of mortgage interest in the Netherlands; it benefits the rich more than the less fortunate. There is a plan on the table to levy a new tax on Foreign Real Estate Owners that do not live in New York full-time, which makes some sense. On the other hand, everyone purchasing Real Estate over $1MM has to pay “Mansion Tax” to the City of New York. That’s $10,000 or more for each transaction.”

Will the market collapse with this new “Foreigner’s Tax”?

“Not likely. Manhattan is such a unique market. Property values were barely affected during the crisis, while Queens, Long Island and Brooklyn saw its share of Foreclosures. I think the City and the State realize the climate has to continue to be investor-friendly. The notion of freebies is ridiculous. Every Condo-owner pays their share in taxes. Co-ops even require a flip-tax be paid by the Seller of an Apartment. The Co-op is another Corporate Construction that owns a building and owners of apartments are really shareholders of the Corporation with the Right to reside in the apartment. You can compare the Co-op Board with the Dutch Home Owners Association. The Flip-Tax is a percentage of the profit of an Apartment Sale paid to the Co-op. It will be used to strengthen the reserve-fund and pays for Capital Improvements to the Building. The story of the rejection of Madonna by such a Co-op Board is well-known in NYC Real Estate.” (https://www.nytimes.com/1985/07/19/nyregion/san-remo-co-op-board-rejects-madonna-s-bid.html)

How is your Business doing these days?

“2015 promises to be a record-year (https://therealdeal.com/blog/2015/02/16/26-contracts-for-4m-or-more-signed-in-first-week-of-february/). In 2008 the Real Estate market collapsed, but demand is on the rise. More Buyers and less inventory makes this a Seller’s Market. Buyers with cash are winning the race and apartments are selling for asking price or higher. It is important to cultivate your Network. Top Realtors such as Fredrik Eklund, Ryan Serhant and Luis D. Ortiz, know from the TV-show Million Dollar Listing New York, have connections with wealthy clients. In New York we have more than 20,000 Realtors. Getting your License is not the toughest part.”

Almost as easy as becoming a NYC Cab driver…

“Easier. As a cabby you need to know your way around New York City. Ha! When you provide good service to your customers, you can certainly set yourself apart from the rest. My best deal thus far was a $3,725,000 Sale where I represented the Buyer. I will top that this year for sure.”

Do you live Large yourself?

“I live in a modest rental apartment in Howard Beach, Queens, close to JFK. Originally trained as a Physical Therapist, I have been a Realtor? since 2007. With the Real Estate market in an upswing, I expect good earnings this year.”

More about Hugo van Dijk, Realtor?: https://kwnyc.com/Hugo-Vandijk

Original Article on QuoteNet.nl: https://www.quotenet.nl/Nieuws/Nederlandse-makelaar-ziet-vastgoedgekte-in-New-York-146437