New York Real Estate Now Affordable

The credit crunch and subprime meltdown creates affordable ownership opportunities for the middle class

Young professionals and blue class workers are fueling what's left of the real estate market in New York City (with the exception of Manhattan). Nationwide (including the boroughs) real estate prices have been declining for most of the year. This is primarily caused by delinquencies in mortgages made over the past 4 years to subprime and no income verification borrowers. Increased foreclosures combined with tightening mortgage underwriting standards have drastically increased the inventory of homes currently on the market.

In addition, this past mortgage meltdown has made securing a Jumbo mortgage much more difficult. A Jumbo mortgage is one that is larger than the conforming loan limit of $417,000. Since New York City real estate prices are in many cases higher than $417,000, sales have lagged due to buyers having difficulty qualifying for Jumbo mortgages. All of these factors have contributed to "the bubble finally bursting".

There has been however, one sweet spot in the New York City real estate market. Affordable living is making a comeback. Smart developers have stopped over building million dollar houses in middle class areas and instead begun developing affordable condo apartments throughout the boroughs. Studio to 3 bedroom apartments can now be bought from the high 100,000's to the mid 300,000's.