Manhattan, New York property is not a yield but rather an appreciation game. An investor buying New York property focuses on the long term appreciation potential. Demand for Manhattan property is global, coming from all over the world. Manhattan is a brand and the vacancy rate is less than 2 percent, relative to the US’s 10 percent average. Inflation would mean rents and property values will increase.

A yield strategy in the US would mean investing in a midsize of small city. For example, Syracuse, New York is a college town with a yield of 10 to 15 percent. From personal experience, the appreciation from a city like Manhattan New York far outweights the rental yield cashflow from a midsize of small city.

Commercial property yield in New York (Manhattan) is driven by price point. The lower price point properties, less than $20 million, generally have an asking price at a 5 percent yield.

The higher price point commercial properties, more than $30 million, would have a higher yield, perhaps 8 percent or more. Reason is that at a higher price point, there are fewer players which decreases demand. Also, buyers at the higher price point are often institutions that put a lot more pressure on sellers from a pricing perspective.

The value of commercial property is driven by yield. Similar to a stock’s PE ratio. The more the landlord can obtain in rent, the higher the value because a set multiple, in this case rental yield, would be applied.\

Wei Min is a real estate broker and investor focused on investment property. He is Founder of Castle Avenue Partners in Manhattan, New York. Previously, Wei Min was VP at Citigroup responsible for a $500 million portfolio. He received Citigroup’s prestigious Chairman’s Award, a recognition awarded to the top 2% of managers. He was also Director of Travel Insurance at American Express where he managed a $180 million portfolio.

Wei Min has traveled to many cities to view thousands of properties. He speaks English, Cantonese Chinese, Malaysian and Mandarin Chinese. He graduated with an MBA from the University of Illinois at Urbana-Champaign and a BBA from Marshall University.

Tags : New York Apartments, New York Homes, New York Property

Real estate in New York City is far different than in other areas. For example, if you wanted to live in the Upper West Side – in The Dakota perhaps – the three bedroom, two bath home where West Side Story was conceived is available now for just under $6 million. If that’s too rich for you, a one-bath studio apartment on West End can be yours for just $435,000. The operative word is “studio” where there is on separate bedroom. The almost half-million dollar purchase price does not cover the monthly maintenance fee of $964, which does include utilities.

A recent report by Prudential’s Douglas Elliman shows housing prices have doubled in the last ten years in Manhattan. For example, a decade ago the average price of a home was $710,000. The average price this year is almost $1.4 million. However, prices are coming down as indicated by the 12 percent DROP from the previous year.

With this kind of up and down activity on the home buying/selling front, the good news is there are real estate agents available and ready to help you find real estate to rent. This is a phenomenon that we’re starting to see across the nation, but it has been perfected by New York agents. Often renters will be required to pay a finder’s fee, but overall rents are dropping along with home prices.

The least expensive place to buy an apartment in New York, as reported by Habitat New York, is Uptown, Brooklyn or Queens. Here, studio apartments start at $1200 and three bedrooms start at $3,000. The most expensive are in the Upper East Side, Upper West Side, and Midtown apartments that start at $1,600 per month and go upwards of $12,000 per month.

If you’re ready to take a bite out of the big apple, be prepared to pay the apple’s weight in gold to buy or plan a good commute for the most affordable apartment rentals.

Tags : New York Business, New York Commercial, New York Real Estate