Jack Jaffa & Associates Reviews 2010’s Impact on NYC Landlords

Brooklyn, NY (PRWEB) December 29, 2010

Amid concerns of the sagging economy, most property owners are still not sure what to make of the 2010 anemic gains in New York City’s housing sector. In retrospect, it is highly unlikely that the year will be remembered as a period of epic expansion since the industry still continues to struggle with achieving any meaningful growth and significant momentum. If this past year’s headlines offer any indication, the onset of a political maelstrom, fears of a potential double dip in the economy, problems in raising capital, implementation of additional administrative and legislative burdens – all of these circumstances only serve to remind property owners of the existence of limited advantages and colossal disadvantages to holding on to their real estate assets. So, what can the year be remembered for? This month’s issue of The Jack Jaffa Report highlights some of the year’s more significant developments effecting NYC property owners.

FORECLOSURE FRAUD – Throughout the nation, a record inventory of unsold homes still hangs over the housing market. The stockpile is continuously being compounded by homes going into foreclosure. In actuality, the number of foreclosure cases has gone down in recent months. However, economists are not attributing this decline to improved economic conditions, but rather to an evolving fraud crisis, which is currently impairing the entire lending industry in the U.S. It seems like the law finally caught up with the foreclosure mills, which forced so many Americans to lose their homes. As some of the biggest lenders and mortgage services have conceded, they’ve mistakenly filed for foreclosure based on fraudulent documents. In some firms, employees routinely robo-signed thousands of legal documents and affidavits submitted in foreclosure proceedings without personal knowledge of the underlying facts or verification of loan file information, and without even reading the documents they signed. As a result of such widespread illegal practices, 23 states including New York have placed various forms of moratoriums on foreclosure proceedings. The industry hasn’t reached a consensus on how to proceed. In the meantime, title insurance companies are taking more time to examine documents to pick up any errors in order to ensure proper chain of title for their clients. This situation is currently responsible for massive legal challenges, which may result in a prolonged housing depression.

BEDBUGS, AGAIN? – By now, residents are probably tired of hearing about them, and although past issues of The Jack Jaffa Report covered their invasion on numerous occasions, it seems like New Yorkers haven’t heard the last about these creepy crawlers just yet. Landlords already know that bedbugs have a way of showing up anywhere, anytime and without any notice, which makes eradicating these pests an immensely arduous task. Just in case their elimination didn’t seem challenging enough, in response to these bugs’ unrelenting reproduction throughout the city, the Department of Sanitation decided to come out with new guidelines for getting rid of apartment furnishings – especially mattresses. As of December 3, 2010 any mattresses left on the curbside for disposal need to be wrapped in plastic. Failure to comply with this rule can set a landlord back $100. Although the rule is already in effect, it will not be fully enforced until January 3, 2011.

POLITICAL REORGANIZATION – While riding waves of voter frustration over the economy, the resulting outcomes of the November elections helped the Republican Party sail into a majority position in the Senate. But it wasn’t long after the election that the “lame duck” Congress had to be summoned back to Washington for key votes on legislation extending the Bush-era tax cuts. Feeling the urgency of the matter, the White House rushed to craft a tax deal with the Republicans, which would extend the tax reductions for all income levels. The negotiated compromise ended up receiving tremendous criticism from members of both parties. Many rank-and-file politicians voiced deep opposition over the extension on the grounds that it disproportionately benefited the well-to-do Americans, while others argued that the tax cuts did not go far enough. As the proposed legislation made its way through the Senate, its members proved more resolute in passing the deal. The House of Representatives struggled to reach passage due to a persistent protest from lawmakers incensed over the deal’s continued benefits for the nation’s wealthiest earners. As it turns out, weeks of acrimony over the measures and convoluted debates over the plan’s extension produced hesitant but much needed bipartisan collaboration. The new legislation is expected to broaden through 2012 all of the tax cuts on income, capital gains and dividends that were enacted in 2001 and 2003 and which were set to expire at the end of the month. In addition, the bill is slated to expand unemployment insurance benefits through 2011, cut payroll taxes by 2% during 2011 and let businesses write off 100% of capital investments between September 9, 2010 and December 31, 2011. It will be interesting to see to what extent the cooperation between the parties will carry on into the next year. Could the bipartisan collaboration be considered a blueprint for compromise in a new era of divided government? In any case, it should be noted that the spirited debates over the Bush-tax cuts will be revisited again in 2012 as the extension will only last for two years.

TECHNOLOGY TO THE RESCUE – It wasn’t so long ago that personal computers and laptops revolutionized the way real estate business was conducted. These days, the limelight has been stolen by smart phones and mobile devices such as Netbooks and iPads. Thus, for example, some Co-op and Condo Boards are embracing iPads for their convenience of providing communication services and for supplying Board members with necessary reports and presentations. Given the time and costs expended in order to conduct their all too important meetings, many Boards find that such devices cut down the limited resources and time wastefully spent in preparing for them. The customary lengthy reports presented at Board meetings are now being replaced with touch-of-a-button accessible documents available on colorful screens. Furthermore, innovative technical services such as Skype and Facetime often eliminate the frequency and necessity to have Board meetings in the first place.

Apps for these mobile devices also continue to be all the rage as new ground-breaking applications are constantly created to reduce hassles previously incurred for complicated business and management operations. One of the most practical apps introduced this year was Square technology, which was designed to bring credit card accepting capabilities to the masses. This app quickly became a useful tool for property owners with tenants behind on rent payments since this technology enabled landlords willing to make impromptu visits to their site with the ability to collect payments on the spot, even if tenants could not pay with checks or cash.

2010 also saw a dramatic increase in the popularity of property management software. Facing looming debt, the City clamped down on property penalties, enforcing stricter compliance and accelerating the time owners have to deal with violations. This has caused many landlords to adopt an automated system to correct, eliminate and minimize their violations. Popular systems, such as Jack Jaffa’s Alert Service Plus, allow building owners and property managers to receive alerts and track violations, as well as opt electronically to have professionals take care of the infractions for them.

EYES ON 2011 - If anything, the developments of 2010 have only taught New Yorkers to continue to adapt as the City changes and as the world at large changes as well. Looking back on the year, despite the evolving challenges, we cannot lose sight of what makes New York City the most remarkable place on earth. Jack Jaffa & Associates continue to believe that these are indeed times of endless opportunity for people willing to endure all of its ups and downs. It is our sincere hope that as this year draws to a close, the New Year will bring only happiness, prosperity and optimism to the City we all love so much.

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